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RFID benefits hard to spot
Only one in three companies knows why they'd implement it...

By Steve Ranger

Published: Thursday 30 June 2005

UK companies are still struggling to see the benefits of RFID technologies.

Only one in three (29 per cent) UK respondents to a BEA Systems-sponsored survey said they could clearly see the benefits of RFID. Thirty-six per cent felt the technology has no benefits, 24 per cent were not quite sure of the benefits and 10 per cent had no idea.

Seven out of 10 respondents said they would need "a lot more information" before they made a decision about implementing it.

The report said: "Benefits of RFID are not well understood... Respondents also say RFID seems promising but they don't know where to start."

Asset tracking, stock control and order status tracking were the areas where RFID could create the biggest benefit.

Six out of 10 said integration and data management would be the biggest issue for RFID implementations. Only five UK companies interviewed said they were using RFID now.

Cranfield School of Management research fellow Dr Andrew White said RFID is beginning to have an impact on a wide variety of business processes.

He said: "This survey reveals that organisations are looking to move beyond the hype cycle but does underline the challenges that remain."

The number one obstacle to implementing RFID is cost - cited by one-third of UK respondents - and being able to demonstrate ROI.

White said the emphasis should be on long-term development of the technology, and in the short term focus on application areas that can deliver return on investment and competitive advantage.

Data integration and management have also been thorny issues to deal with when implementing the technology. Because data needs to be shared across lines of business and between organisations to enable collaborative business processes, the speed with which integration can be delivered will be a critical, the research said.

Heljä Salomaa, business unit manager at the Finnish Post, which is working on an RFID pilot project, said: "To realise the full benefits of RFID companies need to ensure that their business infrastructure can scale to handle the data volumes the technology will generate."

BEA surveyed 150 IT and logistics executives in the UK and Finland.