RFID: Beware the business pitfalls

Companies are rushing to get to grips with the possibilities presented by RFID technology, without stopping to consider the pitfalls and the limitations.

According to Meta Group, organisations are looking to jump on the RFID bandwagon without understanding the full capabilities of the technology.

RFID tags, which can be read and monitored to increase distribution line efficiency, track goods or even people or livestock, are fast becoming one of the most talked-about technologies of 2004 - but that doesn't make them must-have, at least not at the expense of overall business efficiency.

Gene Alvarez, vice president with Meta Group's Technology Research Services advised companies considering what RFID could do for their business to start small.

"Starting with small projects will assist enterprises in climbing the 'RFID learning curve' and establishing standards that support efficient future product movement," he said in a statement.

Large organisations such as Wal-Mart, Gillette and Marks & Spencer have all flirted with RFID to date and many more companies appear to have adopted a watching brief as they gauge the extent of public opposition to the monitoring tags amid privacy concerns.

Businesses must also consider internal issues - such as the effect of RFID on their IT infrastructure, according to Alvarez.

"Many IT organisations do not immediately realise that even smaller RFID projects can significantly affect an entire IT infrastructure and application portfolio, so a readiness assessment must be performed early on," he said.