Is Wal-Mart Canadas New RFID Strategy a Hint of a Gentler Wal-Mart CIO?

Opinion: Wal-Mart Canada's new RFID program will be entirely voluntary, which is the latest tealeaf suggesting that the chain's new CIO is adopting a gentler tone.

When Wal-Mart corporate wants to change a policy or procedure, its fond of trying it in a small way in an out-of-the-way place to see if it works.

After all, even a small pilot for the $312 billion retail empire can be fairly massive by mere mortal standards.

So it was with interest that I was watching this week Wal-Mart Canadas new RFID program, which they are billing as entirely optional and—this is telling—without an announced firm deadline.

First, lets set aside the philosophical question of just how voluntary any program can be when it comes from the worlds largest retailer to its list of highly replaceable suppliers. This one does indeed seem to be different.

To woo suppliers to participate, Mississauga, Ontario-based Wal-Mart Canada has invited 16 companies to attend the Retail Council of Canadas annual STORE Conference in Toronto this week, according to a report July 11 in IT World Canada.

The pilot is expected to start this fall in southern Ontario and run into 2007 as a small controlled experiment with a two-man RFID team overseeing it, the story said.

Tagging will be at the case and pallet levels, using EPC (Electronic Product Code) standard Gen 2 tags—the technology Wal-Mart is standardizing on. Currently, there are no readers in place in Canada to read data from the RFID chips.

Many of the suppliers involved in the Canadian program and already participating in the U.S. program, which may alleviate the need for additional muscular mandates.

But John Fontanella, an RFID analyst with the Aberdeen Group, sees it as the latest in a series of Bentonville hints that new CIO Rollin Ford is taking a slightly more laid-back approach to RFID than did his predecessor, Linda Dillman.

Dillman is perhaps the U.S. executive most identified with pushing RFID, and theres no question that her efforts—along with those from the U.S. Department of Defense, consumer goods leaders Phillip Morris and Procter & Gamble, as well as European retailers Tesco and the Metro Group—are a huge reason RFID is as well-established as it is today. Tesco is having its own problems with RFID.

Next Page: A double-edged sword.