Beware RFID vendor hype: Manugistics

When it comes to the amount of publicity RFID is attracting these days, Manugistics Australia's managing director Tim Moylan makes no bones about being just a little sceptical.

With a client list that stretches from the makers of Corn Flakes to major airlines, the local MD of arguably the world's most entrenched supply chain vendor says that, for all the RFID hype, major enterprises are still adopting a wait-and-see approach - especially when it comes to supply chain and business process optimisation projects.

"I'm not sure why the media think RFID is so sexy. The [return on investment] is not there yet, people are still coming to grips with what it all means [to their enterprise]," Moylan says, noting that most deployments to date are still a far cry from wholesale uptake.

While RFID and solutions have been around in various guises for a number of years, Moylan said most companies are acutely aware that it is only part of a solution wringing productivity from their core business process infrastructure.

Rather, it is the infrastructure itself, Moylan says, that is gradually being upgraded.

"Unless you have a solution that can do something with the information [that RFID generates] it's useless," he said.

For retailers like Coles Myer, collaborating and integrating means teaming up with consumer packaged goods suppliers like Proctor & Gamble and Unilever to execute less sexy but proven improvements. These include significant new initiatives such as Collaborative Planning, Forecasting and Replenishment (CPFR), and extracting real-time sales and performance data.

"While RFID can, and probably will, come to play a part in these systems, it's getting the systems into place first that matters most," Moylan said.

"Companies are starting to get their act together in terms of getting demand signals. This is being driven by [the likes of] Coles Myer and Woolies; they are [effectively] forcing their suppliers to get into supply chain management," Moylan said noting that the big supermarkets are treading carefully so as not to alienate their suppliers.

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