The proliferation of RFID readers and tags has only just begun, but some analysts are already predicting that when fully operational, RFID will generate upwards of 5TB of data at a company's warehouse and distribution center on a daily basis.
There is no doubt that a great deal of that RFID data will be useful for tracking products, in time and space, at the local warehouse or distribution center. Simply tracking the number of times a pallet is moved and routed around a warehouse can help improve internal processes.
But on the back end, after shielding enterprise applications from most of that low level data, the long-term goal will be to turn the more critical RFID data into business logic that enterprise systems can use for executive decision-making.
For the most part, filtering, translating and finally integrating the right RFID into the enterprise applications is handled by middleware.
Forward-thinking hardware manufacturers such as Intermec Technologies, for example, are putting software intelligence into their tags and readers, according to Mike Fisher, RFID business development manager at Intermec.
"You have a group-select feature in these intelligent readers. With a read-write RFID tag, you can designate that only certain tags on pallets or on cases be read as it comes through the dock door," Fisher says.
Upstream, a supply-chain management system might leverage the programmable capabilities of the intelligent readers to monitor deliveries and send an alert to a supply-chain management portal if a designated supplier is not living up to schedules.
Steve Banker, service director of supply-chain management at ARC Advisory Group, says the real issue is integrating data from a variety of sources in order to lean out processes.
"By integrating data across the supply chain, you can get a much clearer picture of what your lead times are and variability around lead times," Banker says.
More traditional supply-chain middleware vendors like i2 Technologies Inc. are also tackling the problem of RFID data integration.
"The problem is there is no standard representation of what the data model should be," says Pallab Chatterjee, president of solutions operations at i2.
i2 is using the concept of master data management, a file where the different formats and protocols from all the leading suppliers and manufacturers for naming and categorizing the very same products are stored and synchronized with one another.
"It is like a thesaurus," Chatterjee says.
IBM, SAP, Oracle, and ObjectStore are also planning to support RFID systems. Companies will need to think about the new kinds of business processes the addition of RFID data creates.
From real-time alerts when perishable goods arrive at the dock door to a system that can convert a purchase order into an alert that tells the fork lift operator to move a just-delivered pallet to the shipping dock rather than the stock room, RFID will eliminate tasks, save time, and add new dimensions of value to a company that uses the data strategically rather than tactically.