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Retailers not prepared for RFID processes

Half of retailers that roll out supply chain radio frequency identification tags will not achieve the full benefits because of an...

Half of retailers that roll out supply chain radio frequency identification tags will not achieve the full benefits because of an inability to change business processes, GartnerG2 has warned.

The analyst firm said business process changes typically make up between 20% and 50% of the systems integration costs of RFID - far higher than estimates made by most retailers so far.

Hung LeHong, a retail analyst at GartnerG2, said, "Large technology initiatives require significant process changes and we predict that RFID is no different.

"Most business cases underestimate or ignore process changes. We recommend retailers conduct a pilot."

Process change will typically involve redesigning inventory flow, the physical layout of warehouses and stores, business logic, roles and responsibilities of IT staff and the use of data.

Retail IT departments should assign dedicated process and change management resources to the RFID team and be prepared to shift people around as the project progresses, according to LeHong.

"In the assessment, design and pilot phases, retailers will need half of their team to be made up of process redesign resources," LeHong said. "During the build phase, this percentage will drop as systems integration and application build resources increase."

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