Another area where manufacturers are eager to leverage EPC data is promotional effectiveness—meaning, in Texas Instruments’ case, Did the special back-to-school displays of its calculators go out onto the shopping floor when they were supposed to? Was the display well-stocked during the back-to-school promotion or did stock run out? Did the display stay on the floor for as long as TI wanted (and paid for) it to?

Right now, the company pays people to go into stores and answer these questions. But that’s costly. "We’re hoping RFID will give us insights into all that," says TI’s RFID Program Manager Tom Shields.

A typical manufacturer will spend 12 percent to 15 percent of the company’s annual sales revenue on promotions, and the industry average for effectiveness of a promotion is 56 percent—a coin toss, says Greg Aimi, director of supply chain research with AMR Research. "Right now, a lot of [promotion planning] is guesswork," Aimi says. "There’s a high degree of latency and delay."

During one of its RFID pilots, Gillette used RFID-retrieved EPC data to discover that 33 percent of stores it supplied failed to move its Venus razor displays from the back room to the floors when the company’s Venus promotion started. Stores that got the displays onto the floors on time sold 19 percent more razors than stores that didn’t. According to Gillette’s analysis, a 19 percent sales increase in one-third of the retailer’s stores would represent an overall sales improvement of 6.3 percent for any given promotion. And that’s a lot of razors.

Process Changes and IT Strategies

Perhaps the most challenging part of getting an ROI from RFID for manufacturers will be integrating the new EPC data flows with their company’s legacy and proprietary systems—such as supply chain and logistics applications and ERP packages—and retooling warehouse and shipping processes to be more in line with RFID’s real-time demands.

The danger for manufacturers with their slap-and-ship deployments—which usually have no clear integration plans or actionable data analysis, and drag on warehouse efficiencies because slap and ship takes extra work—is that RFID implementations will become "islands of technology and information," as Aberdeen Group’s Fontanella poetically suggests. In that scenario, RFID becomes yet another addition to the unintegrated tangle of systems inside many of today’s enterprises.

For RFID data to join the mainland, companies are going to have to include RFID in their future enterprise architecture plans and answer these questions: Will our integration strategy employ middleware packages or service-oriented architecture? What other systems, such as business analytics applications and data warehouses, will the RFID data flow into? How will the company retrieve, store and cleanse the data? And how will the manufacturer’s systems exchange data with its suppliers’ systems? Via spreadsheets, EDI, XML or the Web?