IBM is working with the leading RFID standards body to develop a technology that combines product movement data from radio-frequency identification readers with enterprise application information.
EPC IS, under development by IBM and EPCglobal Inc.—the industry group governing the RFID standards and policies, in Lawrenceville, N.J.—establishes a format for how trading partners gather and exchange inventory information.
The hope is that EPC IS will give suppliers a reason to participate in RFID implementations beyond merely compliance with retailer mandates.
"The reason for our focus is that EPC [Electronic Product Code] information has maximum value when it is shared," said Chris Clauss, worldwide auto-ID leader at IBM, in Armonk, N.Y.
"What were trying to do is create a database that contains the life history of a product ... all that history of events from the time [a product] is manufactured and sold could be stored."
As part of the EPC IS plan, companies would develop internal repositories to house product data information. Those companies would then be able to share that information with partners and suppliers through the EPCglobal Network.
To make that happen, however, the information would first need to be cleansed and synchronized, industry analysts say.
The EPC IS effort becomes relevant to manufacturers struggling to meet Wal-Mart Stores Inc. and other retailers RFID deadlines because it would enable product information sharing along the supply chain. Clauss said he believes the real value of RFID is information sharing. "What we want to do is create the reason for the tag," he said.
The news could be welcome in an otherwise grim outlook for manufacturers. A recent report by ARC Advisory Group Inc. showed that 95 percent of manufacturers surveyed see no return on investment on their RFID implementations for the next two years, at least.
In conducting the Emerging Practices study, Steve Banker, service director for supply chain management at ARC, talked to 24 companies, all under the gun to comply with an RFID mandate and actively investing in EPC RFID.
"I just feel sorry for these poor suppliers," said Banker, in Dedham, Mass. "In my mind, the biggest issue is just the cost of this. Its $1 million to $1.5 million to prepare the infrastructure and half a million to prepare the tags."