Successful RFID Implementation
The good news is that Radio Frequency Identification (RFID) will be one of the best things to happen to the supply chain. The bad news is that the road to implementation is sure to be bumpy. Jon Chorley, senior director, Oracle Inventory and Warehouse Management, offers 10 tips for successful RFID implementation.
1. Get educated. Know what RFID is and what it is not. Leverage industry publications and analyst firms to gain a comprehensive view of RFID and its business implications. Additionally, a number of valuable industry conferences provide the chance to hear firsthand how companies are implementing RFID, as well as the challenges and results they are experiencing.
2. Put together an RFID task force. Companies need to create specialized RFID task forces responsible for planning, designing, implementing, and refining RFID strategies. Although RFID implementation can range in scope and size, the new technology and business processes associated with it can impact all operations. A specialized task force can help ensure an RFID strategy fully meets a company's goals, while minimizing implementation and operational risks.
3. Don't oversell immediate benefits. RFID technology is still evolving. There are likely to be unanticipated costs as technical and process issues are resolved. This will impact any projected ROI. Committing to immediate and significant savings using RFID could prove to be a career-limiting move.
4. Think long term. Many companies are striving to comply with RFID mandates from the Department of Defense, Wal-Mart, and other retailers. These companies need to look beyond what is being asked and plan for the future. RFID can have very positive effects on business—resulting in reduced labor costs, increased supply chain visibility, and improved customer satisfaction rates. Companies need to implement a robust RFID platform that can evolve with their business strategies, and seamlessly work with other areas, such as ERP systems.
5. Talk to software companies. Can your ERP system provider help you implement RFID and tie it into your existing business systems? You want a tie-in, not a quick fix. If the ERP provider can't accommodate you, search for other software companies by researching industry reports and leveraging industry analyst groups.
6. Talk to your trading partners. Companies need to collaborate with their supply chain partners to ensure that extended RFID strategies, encompassing all aspects of the supply chain—planning, manufacturing, inventory management, order fulfillment, and logistics—will support their RFID strategy.
7. Talk to vendors. RFID is a marathon, not a sprint. Companies need to ensure their vendors have strong visions for RFID. Are they being mandated by other suppliers? Do they have RFID initiatives? Find out where they are with RFID and how they can accommodate your needs.
8. Know what you want to tag. Once you have adopted an RFID strategy, think about what level to tag. Do you want to tag at the item level or the pallet level? Consider tag price and volume. These decisions will greatly influence the amount of new data flowing through systems that need to be managed.
9. Run a pilot program. Companies should first run a small internal RFID pilot program to better understand the business process and how technology will impact daily operations. Once you have accomplished this stage, implement a broader external pilot program—working closely with long-time business partners—to see how RFID impacts trading relationships and the entire supply chain. Pilot programs are a great method for testing strategies and understanding change before extending RFID to customers.
10. Measure your results. Set goals and expectations and track the details of what works and what does not. This will be key in determining how to translate the experience you gained from your pilot RFID program into production success.