RFID's Acceptance By Large Medical, Retail Enterprises Opens Door For Adoption By Smaller Businesses

Small to medium-sized businesses (SMBs) are rapidly exploring ways to adopt Radio Frequency Identification (RFID) for customer applications, especially as the new technology gains acceptance nationally at the medical enterprise and chain-store retail level, according to the Information Technology Solution Providers Alliance (ITSPA). ITSPA is a national, non-profit alliance that helps SMBs understand how technology and local technology providers can help them succeed.

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"SMBs in a variety of industries ranging from retail and manufacturing to defense consulting and logistics are becoming increasingly aware of RFID's acceptance and success at the medical and retail enterprise level," said ITSPA President Russell Morgan. "This trend is encouraging SMBs to turn their focus to RFID technology and how it can potentially reduce and even eliminate inefficiencies in the supply chain that cost millions of dollars each year."

RFID deployments have become a top priority in many major hospitals and among retail stores both nationally and worldwide, ITSPA claims. RFID solutions, implemented quickly and easily using a healthcare institution's or retail chain's local-area-network (LAN) infrastructure, provide fast and effective deployment and servicing of critical assets such as equipment and key personnel.

"RFID solutions adopted by medical and retail enterprises integrate seamlessly with workflow and business process automation software," Morgan said. "This capability provides real-time location information and asset tracking to optimize equipment investments and improve operating efficiency.

"The bottom line is that if major medical and retail enterprises can use RFID to improve response times and improve customer services, so can SMBs that are focused on improving workflow, reducing time-consuming processes and reigning in costs."

Defining RFID

ITSPA's members--IT solution providers across the nation who help SMBs discover and apply technology to meet business challenges--define RFID as a technology for tracking anything from people to supplies to work orders. In basic terms, RFID consists of tiny silicon-chip tags attached to a radio antenna. The tags are attached to whatever needs to be tracked. Hand-held devices called "readers" communicate with the tags and send data to a computer.

"IT solution providers are really the key to helping SMBs integrate and apply RFID," Morgan said. "Many solution providers understand the new RFID technology and have connected RFID capabilities to their customers' LAN infrastructure. In so doing, they are helping SMBs achieve seamless integration with workflow and asset maintenance systems, enabling more efficient and less time-consuming processes."

RFID Growing Fast Among SMBs

According to a Gartner Dataquest study last year, 40 percent of "inventory-intensive" SMBs in the U.S. will have a wireless tracking solution such as RFID by the end of 2005. The study also revealed that RFID can reduce SMB location errors by 90 percent, increase productivity by 12-15 percent and decrease inventory-counting time by 40 percent.

"These facts point out that now is the time for SMBs to consider RFID applications, and we recommend they begin by contacting a local IT solution provider for advice and help," Morgan said. "The timing is perfect for many SMBs to adopt RFID technology because their customers, ranging from Wal-Mart to the U.S. Department of Defense, are already successfully using RFID," Morgan added.

Before SMBs consider RFID technology, however, Morgan suggested that they review the following tips provided by ITSPA's members:

-- Information is Key: Because RFID is still an emerging technology there are still many unknowns. Learning about the technology from early adopters, trade associations and manufacturers are ways that an SMB can learn more about RFID.

-- Investigate ROI: Because RFID can be expensive, it's important to understand how much implementation will cost and what the benefits will be. Even as the cost of RFID technology continues to come down, this will still be an issue for SMBs, particularly in healthcare.

-- Partner With RFID Solution Providers: A critical factor for SMBs in considering any technology is hiring the proper consultant or solution provider. Even in the early stages of RFID consideration, SMBs should work with solution providers who have already handled RFID implementations and know the pitfalls.

-- Patience: Continue to monitor RFID implementations in large healthcare settings, but be patient and watch as the standards continue to evolve.

About ITSPA:

ITSPA, the Information Technology Solution Providers Alliance, is a non-profit (501.c.6) organization dedicated to helping small and medium companies adopt technology and grow by using local solution providers to solve business problems. SMB customers, solution providers, along with manufacturers, publishers and networking companies who use the solution provider channel, are expected to benefit from the demand for technology generated from its programs. ITSPA began operations with a funding grant from HP. Additional sponsors can be found at our Web site. ITSPA's national headquarters are located at 2633 McKinney Avenue, Suite 130-320, Dallas, Texas 75204. The general business phone number is 214-542-6594. Visit ITSPA Web site at www.itspa.net