Chief Marketing Officers (CMOs) and Chief Information Officers (CIOs) are on different planets. They have different agendas and they speak different languages. There’s lack of coordination, working at cross-purposes, and full-scale political warfare. For businesses that fix this problem now, there’s immense and growing potential. For businesses slow to fix it, there’s stagnation and decline. You’ve seen it yourself and it’s a much discussed feature from CIO Magazine (10/4/2010, “CMOs and CIOs: Can this Relationship Be Saved?”). Everyone knows about it, but what’s to be done?
The marketing-IT relationship is broken in a deep way. The organizations and their leaders lack trust and norms for cooperation. A fundamental shift, which bridges the two planets and provides new momentum, is required. The shift depends upon a bridge to overcome the barriers of entrenched agendas and different languages. The shift also depends on new momentum based on shared success. When woven together, the bridge and new momentum reinforce each other. The result is unification of existing skills and knowledge, leveraged to realize strategic business potential.
Infusing the fundamental shift from an external source is expedient. The CMO and CIO want to make the shift on their own, but they are mired in past behaviors and politics. Attempts to pull out of the downward spiral by internal mediation, visioning, or edict will be too slow or completely ineffective. In comparison with the historical animosities between marketing and IT, the external source presents an opportunity for success. Neither CMO nor CIO can continue the failures of the past, and allying with an external source presents them with an alternative they could not achieve on their own.
In a difficult marriage, the husband and wife seek the assistance of a counselor to change chemistry. The marketing and IT functions must align through a fundamental shift, but like the husband and wife, the CMO and CIO can’t do it on their own. Without an infusion from an external source, they’ll continue the dire status quo. The benefits of aligned marketing and IT are too great to pass up. The CMO and CIO may not be able to agree on much, but one thing they should agree on is to get an external infusion that bridges their different planets and provides new momentum.
Saturday, October 16, 2010
Sunday, July 25, 2010
New Drivers Revive Old Ideas in New Ways
Veterans in information technology have a sense of déjà vu relating to virtualization and cloud computing. Yes, they are new, but they are also reminiscent of old. IBM VM (Virtual Machine), a forerunner to today’s virtualization, was introduced in 1972. RSTS (Resource Sharing / Time Sharing) is a precursor to cloud computing that was introduced in 1970 by Digital Equipment Corporation.
In those earlier days, managing relatively scarce and expensive computing resources was the challenge. Sharing the cost of the computing resources made computing affordable. As a result of Moore’s law and huge advances in data networks, the cost of computing and information resources is no longer an issue. Information processing is available in the post-industrial world to [almost] anyone [almost] anywhere.
The old ideas may have come back, but they are coming back for a different reason. The driver today is keeping up with change. For competitive, risk, legal, and compliance reasons, companies need to stay up-to-date with technology. Even companies with great wealth find the endless process of keeping up with technology change to be a distraction. The pace of change in underlying technology has increased to the point where it consumes too much attention that could be focused on the core business.
Businesses are not worried that sharing virtualized infrastructure in the cloud will provide an advantage to their competitors. They are worried about being slower than their competitors to get on a cloud bandwagon that provides an advantage. The shared commitment to a cloud environment will keep a company more up-to-date, without distracting from the core business, at a cost no more than it would have cost to do it themselves.
Whether SaaS, utility computing, web services in the cloud, platform as a service, or some other formulation, there are increasing opportunities to contract-out the job of keeping up with technology. Whether HP, IBM, Google, Amazon, or a wide range of providers focused on specific applications there are providers ready to contract for that service. With the pace of change speeding up and increasing opportunities to contract-out the risky business of keeping up, those old ideas delivered in new ways are going to be around for a lot longer.
(I mention RSTS and VM in the post above because of my first-hand exposure to them. I used RSTS in 1978 at school, working on Digital Equipment Corporation PDP-11/34. I first encountered IBM’s VM in 1984 while working on Nixdorf computer’s 8890, an IBM 370-4300 plug compatible.)
In those earlier days, managing relatively scarce and expensive computing resources was the challenge. Sharing the cost of the computing resources made computing affordable. As a result of Moore’s law and huge advances in data networks, the cost of computing and information resources is no longer an issue. Information processing is available in the post-industrial world to [almost] anyone [almost] anywhere.
The old ideas may have come back, but they are coming back for a different reason. The driver today is keeping up with change. For competitive, risk, legal, and compliance reasons, companies need to stay up-to-date with technology. Even companies with great wealth find the endless process of keeping up with technology change to be a distraction. The pace of change in underlying technology has increased to the point where it consumes too much attention that could be focused on the core business.
Businesses are not worried that sharing virtualized infrastructure in the cloud will provide an advantage to their competitors. They are worried about being slower than their competitors to get on a cloud bandwagon that provides an advantage. The shared commitment to a cloud environment will keep a company more up-to-date, without distracting from the core business, at a cost no more than it would have cost to do it themselves.
Whether SaaS, utility computing, web services in the cloud, platform as a service, or some other formulation, there are increasing opportunities to contract-out the job of keeping up with technology. Whether HP, IBM, Google, Amazon, or a wide range of providers focused on specific applications there are providers ready to contract for that service. With the pace of change speeding up and increasing opportunities to contract-out the risky business of keeping up, those old ideas delivered in new ways are going to be around for a lot longer.
(I mention RSTS and VM in the post above because of my first-hand exposure to them. I used RSTS in 1978 at school, working on Digital Equipment Corporation PDP-11/34. I first encountered IBM’s VM in 1984 while working on Nixdorf computer’s 8890, an IBM 370-4300 plug compatible.)
Sunday, July 18, 2010
Case Management, Low on Hype, May Deliver the Promises of Its Ancestors
Provide workers the information they need to get their jobs done. It’s a great idea. Like most things, it’s been done before.
Provide workers the information they need to get their jobs done. That’s my one-line explanation for the knowledge-enabled processes of the 1990s.
What’s different now?
Software and solutions have been sold under the banners of knowledge management, content management, collaboration, workflow, business process management, and business process automation. All of those ancestors of case management have played their role, and in some cases, not lived up to the hype. Now the hype has been replaced by experience and the technologies have matured. The experience and maturity are being blended together into case management.
Unlike its ancestors, case management is low on hype. Unlike its ancestors, case management is not a stretch on the features of deployed solutions. The key benefit of case management is not new, unheard-of functionality. The key benefit of case management is to deliver easily-conceived functionality in a more productive user experience, with parameter-driven deployment, and with modest integration effort. Case management promises to remove technology barriers between content, data, process, and collaboration, to deliver the information the business wants, economically.
At first, EMC seems an unlikely candidate to deliver on this vision for case management. On further thought, case management may be the ultimate synergy of EMC’s eRoom, Documentum, Captiva, and Pro-activity heritage. eRoom achieved incredible heights of user appeal and deployability. Documentum has always been exceptionally integratable. Captiva brings world class ability to transform information on paper to electronic information, so that workers can get their jobs done. Proactivity offers the highest level of business process science. In its xCP product, EMC is showing strategic commitment to exactly this combination in the case management space. With this combination and commitment, xCP may be the product that exceeds industry hype.
Provide workers the information they need to get their jobs done. That’s my one-line explanation for the knowledge-enabled processes of the 1990s.
What’s different now?
Software and solutions have been sold under the banners of knowledge management, content management, collaboration, workflow, business process management, and business process automation. All of those ancestors of case management have played their role, and in some cases, not lived up to the hype. Now the hype has been replaced by experience and the technologies have matured. The experience and maturity are being blended together into case management.
Unlike its ancestors, case management is low on hype. Unlike its ancestors, case management is not a stretch on the features of deployed solutions. The key benefit of case management is not new, unheard-of functionality. The key benefit of case management is to deliver easily-conceived functionality in a more productive user experience, with parameter-driven deployment, and with modest integration effort. Case management promises to remove technology barriers between content, data, process, and collaboration, to deliver the information the business wants, economically.
At first, EMC seems an unlikely candidate to deliver on this vision for case management. On further thought, case management may be the ultimate synergy of EMC’s eRoom, Documentum, Captiva, and Pro-activity heritage. eRoom achieved incredible heights of user appeal and deployability. Documentum has always been exceptionally integratable. Captiva brings world class ability to transform information on paper to electronic information, so that workers can get their jobs done. Proactivity offers the highest level of business process science. In its xCP product, EMC is showing strategic commitment to exactly this combination in the case management space. With this combination and commitment, xCP may be the product that exceeds industry hype.
Sunday, July 11, 2010
Get Ready for More Information about Product Origin
Point of origin is important for consumers, manufacturers, retailers, and governments. Technology and infrastructure are evolving to increase access to accurate point of origin information.
Consumers care where a product was made. Consumers of a given country are often more likely to buy a product that was made in their own country. For some products, consumers associate special value to specific countries and country of origin is becoming an important brand. For example, Columbia invests in consumer awareness of it coffee, Switzerland invests in consumer awareness of a range of products such as watches, and Volkswagen promotes German origin as a desirable attribute for cars. In some cases, not only country but region is an important distinction for consumers; some consumers want smoked salmon not from Canada, but from Nova Scotia or sparkling wine not from France, but from Champagne.
Because consumers care where a product was made, it’s important for manufacturers and retailers to communicate point of origin or point of manufacture to consumers. Manufacturers and retailers know consumers will favor goods from their home country and in some cases pay a premium for goods from a particular country or region. They spend money to promote the value of goods from a particular region, and those who can give consumers confidence in point of origin will be able to obtain a superior return.
Governments invest in their national brands, and maintaining integrity in point of origin information is important for protecting the brand. Governments want to enforce trade restrictions (e.g., United States does not allow the import of highly desirable cigars from Cuba) and keep accurate statistics on imports and exports (e.g., United States Department of Commerce restrictions). Governments want to collect import and value added taxes fairly and efficiently. Finally, governments want to control and track movement of some valuable commodities, such as antiquities and nuclear material.
The infrastructure and technology to confirm point of origin is developing to the stage where businesses and governments can begin to incorporate into their plans an increasing awareness and ability to track point of origin. Goods are increasingly identified with RFID tags and pass through intelligent portals when entering a leaving a country, warehouse, truck, or ship. Additionally, in-store hand held RFID readers are also being deployed. The Electronic Product Code transmitted by RFID tags can be used to confirm the origin of the product.
With point of origin information becoming increasingly available, branding and consumer awareness of micro-geographies will increase. For example, Consumers will always be pleased to know that their coffee comes from Columbia, but will be fascinated to know the specific grower who produced the coffee, and the growing techniques used by that grower. As the technology and infrastructure continues to develop, a whole new world of origin awareness is on its way.
Consumers care where a product was made. Consumers of a given country are often more likely to buy a product that was made in their own country. For some products, consumers associate special value to specific countries and country of origin is becoming an important brand. For example, Columbia invests in consumer awareness of it coffee, Switzerland invests in consumer awareness of a range of products such as watches, and Volkswagen promotes German origin as a desirable attribute for cars. In some cases, not only country but region is an important distinction for consumers; some consumers want smoked salmon not from Canada, but from Nova Scotia or sparkling wine not from France, but from Champagne.
Because consumers care where a product was made, it’s important for manufacturers and retailers to communicate point of origin or point of manufacture to consumers. Manufacturers and retailers know consumers will favor goods from their home country and in some cases pay a premium for goods from a particular country or region. They spend money to promote the value of goods from a particular region, and those who can give consumers confidence in point of origin will be able to obtain a superior return.
Governments invest in their national brands, and maintaining integrity in point of origin information is important for protecting the brand. Governments want to enforce trade restrictions (e.g., United States does not allow the import of highly desirable cigars from Cuba) and keep accurate statistics on imports and exports (e.g., United States Department of Commerce restrictions). Governments want to collect import and value added taxes fairly and efficiently. Finally, governments want to control and track movement of some valuable commodities, such as antiquities and nuclear material.
The infrastructure and technology to confirm point of origin is developing to the stage where businesses and governments can begin to incorporate into their plans an increasing awareness and ability to track point of origin. Goods are increasingly identified with RFID tags and pass through intelligent portals when entering a leaving a country, warehouse, truck, or ship. Additionally, in-store hand held RFID readers are also being deployed. The Electronic Product Code transmitted by RFID tags can be used to confirm the origin of the product.
With point of origin information becoming increasingly available, branding and consumer awareness of micro-geographies will increase. For example, Consumers will always be pleased to know that their coffee comes from Columbia, but will be fascinated to know the specific grower who produced the coffee, and the growing techniques used by that grower. As the technology and infrastructure continues to develop, a whole new world of origin awareness is on its way.
Monday, July 5, 2010
Evolving from Closed Loop to Open Loop RFID Applications
The capabilities of RFID and EPC are difficult to weave into routine thoughts and plans. They are such a departure from today’s technology, that even after many exposures to RFID and EPC, the influence of years of prior experience without them still injects a bias in planning the future. This bias is an adoption challenge that is holding back big returns for organizations and economies of all sizes.
One step to cope with the adoption challenge is to work on a small scale. Alan Sherman of OATSystems recently gave me an example of a small-scale success that is bringing RFID into every day life. An ambulance company previously spent hours with a manual checklist making sure the right equipment was in place to confirm the ambulance was ready for medical emergencies. With an RFID solution, this ambulance company now knows instantly whether essential equipment is in the ambulance, and they are incorporating RFID into ideas for the future of their mechanical maintenance.
Beyond the challenge of implementing closed-loop applications, the more difficult challenge of open loop applications awaits. The ambulance success and most accumulated RFID success stories are closed loop applications. In these applications, tagging and reading are performed on items while they are within the control of a single company. In open loop applications, tags and readers across multiple organizations work together, so that readers from a company can recognize tags and retrieve information about tagged items whether that company placed the tag on the item or not.
Envisioning open loop applications is more difficult than envisioning closed loop applications because it includes coordinated effort among many players about the fundamentals of reading tags, capturing related transactions (Application Level Events), and back-end systems. ATA-2000 and Produce Traceability Initiative (PRI) are examples of ongoing implementations that incorporate open loop thinking. ATA-2000, supported by the aviation industry via the Air Transport Association, defines cradle to grave tracing of aircraft parts, to support quality and efficiency in maintenance and regulatory compliance. PTI, supported by Canadian Produce Marketing Association, Produce Marketing Association, and United Fresh Produce Association, defines tracing or produce from growers, to packers, to retail locations.
ATA-2000 and PTI are exciting programs that are fundamentally changing the way business is done in aviation and in food supply. These types of open loop applications reflect a big way of thinking that produces big returns. They present an example that others can use to identify and envision additional open loop applications to unlock more of the big returns.
One step to cope with the adoption challenge is to work on a small scale. Alan Sherman of OATSystems recently gave me an example of a small-scale success that is bringing RFID into every day life. An ambulance company previously spent hours with a manual checklist making sure the right equipment was in place to confirm the ambulance was ready for medical emergencies. With an RFID solution, this ambulance company now knows instantly whether essential equipment is in the ambulance, and they are incorporating RFID into ideas for the future of their mechanical maintenance.
Beyond the challenge of implementing closed-loop applications, the more difficult challenge of open loop applications awaits. The ambulance success and most accumulated RFID success stories are closed loop applications. In these applications, tagging and reading are performed on items while they are within the control of a single company. In open loop applications, tags and readers across multiple organizations work together, so that readers from a company can recognize tags and retrieve information about tagged items whether that company placed the tag on the item or not.
Envisioning open loop applications is more difficult than envisioning closed loop applications because it includes coordinated effort among many players about the fundamentals of reading tags, capturing related transactions (Application Level Events), and back-end systems. ATA-2000 and Produce Traceability Initiative (PRI) are examples of ongoing implementations that incorporate open loop thinking. ATA-2000, supported by the aviation industry via the Air Transport Association, defines cradle to grave tracing of aircraft parts, to support quality and efficiency in maintenance and regulatory compliance. PTI, supported by Canadian Produce Marketing Association, Produce Marketing Association, and United Fresh Produce Association, defines tracing or produce from growers, to packers, to retail locations.
ATA-2000 and PTI are exciting programs that are fundamentally changing the way business is done in aviation and in food supply. These types of open loop applications reflect a big way of thinking that produces big returns. They present an example that others can use to identify and envision additional open loop applications to unlock more of the big returns.
Sunday, June 27, 2010
Case Management -- What’s in a Name?
For people in the fields of law enforcement, legal or social work, the word “case” is in common use, and it’s natural to speak of managing a case. Even for people outside of those fields, there is a good understanding of what is meant by “Case Management”. Now the term Case Management is being used in a stretch role as a label for an information technology offering.
In its new mission, Case Management refers to a next stage in the evolution of offerings known previously by workflow, business process management(BPM), and business process automation(BPA). Case Management offerings integrate the workflow-BPM-BPA heritage with an agnostic presentation of structured and unstructured information. Elements from offerings known as Business Intelligence and Enterprise Performance Management are sometimes included in Case Management.
History has no shortage of information technology labels that produced more confusion than communication. As old as it is, and in spite of significant resources having been expended, the term Knowledge Management can still ignite pointless debates about its meaning. Although there’s much less at stake, I have even recently continued to see twitter dialog questioning the significance of the term Business Process Automation versus Business Process Management. (In my mind, no significance worth discussing.)
I spoke with Tom Davenport about Case Management, and we agreed that there is a problem reconciling the common usage of Case Management in law enforcement, legal, and social work with the new use to refer to an information technology offering. We concluded that although it’s not perfect, Case Management is better than other available terms to represent the new field of information technology.
Case Management has something going for it. With early returns in, people who need or want do make the cognitive leap from the common usage to the information technology meaning of Case Management. They can make the leap in a matter of minutes without a lot of hand holding or debate. That’s powerful. In terms of communication, that’s what will make Case Management a communication success.
In its new mission, Case Management refers to a next stage in the evolution of offerings known previously by workflow, business process management(BPM), and business process automation(BPA). Case Management offerings integrate the workflow-BPM-BPA heritage with an agnostic presentation of structured and unstructured information. Elements from offerings known as Business Intelligence and Enterprise Performance Management are sometimes included in Case Management.
History has no shortage of information technology labels that produced more confusion than communication. As old as it is, and in spite of significant resources having been expended, the term Knowledge Management can still ignite pointless debates about its meaning. Although there’s much less at stake, I have even recently continued to see twitter dialog questioning the significance of the term Business Process Automation versus Business Process Management. (In my mind, no significance worth discussing.)
I spoke with Tom Davenport about Case Management, and we agreed that there is a problem reconciling the common usage of Case Management in law enforcement, legal, and social work with the new use to refer to an information technology offering. We concluded that although it’s not perfect, Case Management is better than other available terms to represent the new field of information technology.
Case Management has something going for it. With early returns in, people who need or want do make the cognitive leap from the common usage to the information technology meaning of Case Management. They can make the leap in a matter of minutes without a lot of hand holding or debate. That’s powerful. In terms of communication, that’s what will make Case Management a communication success.
Sunday, June 20, 2010
We Were Born Knowing How to Manage Inventory, but Can We Remember Now?
I can barely remember the first time I heard of an inventory clearance sales event and learned about the idea of “taking inventory”. Like most children who have learned the concept of subtraction, I was surprised. I wondered why a record of inventory on hand wasn’t maintained continuously, with a subtraction being made each time a product was sold. Later I understood that doing a subtraction operation for each item sold would be more costly and cumbersome, even for small businesses, than doing the periodic inventory. No business owner wants to keep a customer waiting so that a record of inventory can be updated.
It was a marvel and I told my children to observe carefully when several years ago on a vacation to remote parts of Maine we visited a grocery store with a cashier inspecting each item for a price tag and entering the price for the item into the cash register. Our check-out in that store would have been much more time consuming and costly if that cashier had to make some separate note or update inventory for each price she entered into the cash register. I hadn’t seen a check-out like that for years and I assume I will never see one again.
Accounting practices, information systems, company policies, tax laws, and habit have grown up around periodic inventory. Today, in-store check-out is all barcode scanning and increasingly self-service barcode scanning. An electronic transaction is captured without manual effort. On-line “check-out” is also free of the constraints that gave rise to periodic inventories. Updating inventory for each item sold need not take any manual effort or deprive the customer of any attention.
Periodic inventory was the best economic alternative at the time it was developed, because updating inventory as a part of each sales transaction was too costly. Today, it is the periodic inventory that is costly and inefficient relative to the potential for using point of sale data to update perpetually. Although it is hard to imagine life without periodic inventory, we need to try, because the original reasons for periodic inventory no longer exist.
It was a marvel and I told my children to observe carefully when several years ago on a vacation to remote parts of Maine we visited a grocery store with a cashier inspecting each item for a price tag and entering the price for the item into the cash register. Our check-out in that store would have been much more time consuming and costly if that cashier had to make some separate note or update inventory for each price she entered into the cash register. I hadn’t seen a check-out like that for years and I assume I will never see one again.
Accounting practices, information systems, company policies, tax laws, and habit have grown up around periodic inventory. Today, in-store check-out is all barcode scanning and increasingly self-service barcode scanning. An electronic transaction is captured without manual effort. On-line “check-out” is also free of the constraints that gave rise to periodic inventories. Updating inventory for each item sold need not take any manual effort or deprive the customer of any attention.
Periodic inventory was the best economic alternative at the time it was developed, because updating inventory as a part of each sales transaction was too costly. Today, it is the periodic inventory that is costly and inefficient relative to the potential for using point of sale data to update perpetually. Although it is hard to imagine life without periodic inventory, we need to try, because the original reasons for periodic inventory no longer exist.
Sunday, June 13, 2010
I Want More from EPC Search
If RFID does only one thing, it must detect the Electronic Product Codes (EPCs) associated with items. The ability to detect EPCs enables the creation of a time and place log which delivers benefits related to logistics, inventory management, quality, and authentication. These benefits are immense and are reliably delivered by currently available products, but I want more.
The EPC should unlock more than just an item’s logistical history. If I know the EPC of a garment that I own, I want to know care instructions and where I can buy another garment like it. If I am considering the purchase of a consumer electronic, I want easy access to detailed specifications and instructions. If my neighbor has purchased a handbag second hand, she wants to know whether it’s genuine Gucci. If I see a poster for a movie, I want to read the tag on the poster and view the trailer on my mobile device.
Here are some more general statements of the information I want relative to an EPC. I want to...
- search for information about EPCs as easily as I search the web for key words
- get a result set of rich information about any type of item
- access information about a specific item
- avoid the labor and mistakes of typing in a long number
- be able to perform my search from my mobile device or any computer
International Standard Book Numbers (ISBNs) that are used to identify books provide an example of what can be achieved. Using just an ISBN number as a Google search term on my computer or mobile device returns purchase opportunities, summaries, author information, and more. ISBN searching has reached an admirable state of maturity. One drawback is that because most people including myself don’t have a barcode reader, typing the ISBN number is manually intensive and error-prone. A second drawback is that there is no item-specific identification, so I can’t determine whether a specific book is a copy my brother loaned me or a copy I bought myself.
The ISBN standard was published by International Organization for Standardization (ISO) in 1970. Since UPCs first went into production use only 4 years later in 1974, it’s surprising that searching for information about UPCs is considerably less mature. Searching for information about a UPC using Google is fruitless. Instead, various specialized and competing search facilities (e.g., http://www.singleupc.com/, http://www.upcdatabase.com/, http://upcdata.info/) provide diverging results. Even using the specialized UPC search facilities, results are limited, consisting of a small number of highly structured fields such as description, size/weight, issuing country, and last modified date.
The EPC 96-bit format achieved a level of stability in June 2008 when "EPCglobal Tag Data Standards Version 1.4" was ratified by GS1. Predictably, freely available search facilities for EPC lag those for ISBN and UPC, but standards efforts related to Object Naming Service, EPC Information Services, and EPC Discovery Services provide a foundation for emergence of EPC search that can fulfill the wants above. With these standards efforts and the experience of ISBN and UPC, the best of searching for things lies ahead.
Monday, May 31, 2010
Revolutionary Applications when Mobile Broadband meets RFID
In June 2009, Ericsson’s VP of Systems Architecture, Håkan Djuphammar, proclaimed that all new mobile phones will be equipped with RFID by summer 2010. As of today, NCFWorld reports active RFID tag pilots at municipalities in France, Telefonica, Garanti Bank in Turkey, and others. My bet is that Håkan will not achieve his timeline, but that ultimately his vision for widespread use of phones for authentication, access, and payment will be realized.
Even if it is a delay relative to Håkan’s ambitions, RFID read and transmit will become a common feature of phones at about the same time 4G broadband capabilities become frequent part of phone-network packages. In technical terms, this will allow streaming of rich content in response to EPC Application Level Events (ALEs). Here are some future real life examples:
A lot of moving parts need to come together to make these solutions and other solutions real. In addition to availability of devices from the likes of Sony Ericsson, point of sale/service experiences need to be designed and deployed, networks need to be constructed, and back-end systems need to be developed. That’s a lot of coordinated investment but Sony Ericsson and the 4G network providers are leading the charge with big investments. Now businesses can make their application investments and know they are not alone. The time is right for businesses to make this three-way partnership. These applications are too exciting and valuable to pass up.
Even if it is a delay relative to Håkan’s ambitions, RFID read and transmit will become a common feature of phones at about the same time 4G broadband capabilities become frequent part of phone-network packages. In technical terms, this will allow streaming of rich content in response to EPC Application Level Events (ALEs). Here are some future real life examples:
- An in-store shopper touches her phone to a garment and receives video of celebrities modeling similar fashions, with accessories
- A coffee drinker pays for a cup of coffee made with beans from his favorite region of Columbia and receives an infomercial on neighboring coffee producing regions.
- A patient uses a phone to make a co-payment for medical services and can immediately use the phone to view explanation of benefits from the payer
A lot of moving parts need to come together to make these solutions and other solutions real. In addition to availability of devices from the likes of Sony Ericsson, point of sale/service experiences need to be designed and deployed, networks need to be constructed, and back-end systems need to be developed. That’s a lot of coordinated investment but Sony Ericsson and the 4G network providers are leading the charge with big investments. Now businesses can make their application investments and know they are not alone. The time is right for businesses to make this three-way partnership. These applications are too exciting and valuable to pass up.
Sunday, May 23, 2010
Yes, GDSN is in Rapid Growth Phase, but Does the World Need More Registered Data Pools?
As of today, GS1 indicates there are 28 registered GDSN data pools (http://www.gs1.org/docs/gdsn/gdsn_certified_data_pools.pdf). That’s a 35+% annual growth rate since 2006 when there were 8 registered GDSN pools. In that same period, individual pools have also grown dramatically, and there are now millions of Global Trade Identification Numbers (GTINs) registered.
GDSN has hit the rapid growth phase of adoption. GDSN is proven and the benefits are clear. For suppliers and retailers of any type and of any significant size, the question is not whether to use GDSN, but when. Adoption has obtained a critical mass that now attracts more adopters. Anticipate millions of additional GTINs being registered.
Being in the rapid growth phase doesn’t mean that more registered data pools are warranted. In the near term, GDSN growth will be served more by expansion of existing registered data pools and less by creation of new pools. While some additional registered data pools will be added, most needs will be addressed by the expansion of existing registered data pools to serve additional regional and national markets and specialized industry needs.
In the very long term, it may turn out that there are too many registered data pools, which will trigger consolidation. At that point in time, the large and lean along with some niche specialists will survive in this operationally-intensive business. Then, the number of registered data pools will not grow but shrink.
For the 28 registered data pools in operation today, it’s time to acquire customers. The moves and successes today will determine who will survive as large and lean in the future, who will survive as niche specialist, and who will not survive.
GDSN has hit the rapid growth phase of adoption. GDSN is proven and the benefits are clear. For suppliers and retailers of any type and of any significant size, the question is not whether to use GDSN, but when. Adoption has obtained a critical mass that now attracts more adopters. Anticipate millions of additional GTINs being registered.
Being in the rapid growth phase doesn’t mean that more registered data pools are warranted. In the near term, GDSN growth will be served more by expansion of existing registered data pools and less by creation of new pools. While some additional registered data pools will be added, most needs will be addressed by the expansion of existing registered data pools to serve additional regional and national markets and specialized industry needs.
In the very long term, it may turn out that there are too many registered data pools, which will trigger consolidation. At that point in time, the large and lean along with some niche specialists will survive in this operationally-intensive business. Then, the number of registered data pools will not grow but shrink.
For the 28 registered data pools in operation today, it’s time to acquire customers. The moves and successes today will determine who will survive as large and lean in the future, who will survive as niche specialist, and who will not survive.
Sunday, May 16, 2010
Heed the Business Case
“We are working with EPC, but less with RFID, due to cost per unit”, is what a friend replied when I asked about his RFID program. The decision was made with more than a million dollars invested to explore RFID for the purpose of item-level track and trace, and especially for purpose of preventing counterfeit product from entering the distribution chain. Based on careful analysis, even with a paramount need to prevent counterfeiting, his plan is “EPC yes, RFID no”. They will use EPC for unique item-level identification, but for the foreseeable future, the EPCs won’t be affixed to products via an RFID tag.
After much anticipation about employing the perfect marriage of EPC and RFID, the conclusion to forego RFID is on one hand, a disappointment. Even my friend’s company, with significant resources to plan and execute for large-scale and long-term, couldn’t make the business case work for item-level tagging. It’s disappointing at first, but on the other hand, deferring to business case over emotional attachment to technology deserves much respect.
When the business case doesn’t make sense, it’s best to call off the deployment early and avoid the more painful reality of bad economics later in the deployment. Moving ahead when the business case doesn’t make sense only results in high-visibility, costly failures. Failure to heed a bad business case will trigger a “gun shy” attitude and undermine support for future RFID deployments, even when they do make business sense. Failure to heed a bad business case will also present an unwarranted warning to others that will bias their intuition against RFID projects.
Asset tracking with RFID can pay highly-respectable returns. Pallet tagging, case tagging, and a wide range of other RFID applications can pay highly-respectable returns. In spite of my friend’s company deciding against it, item level tagging can, whether today or in the future, also pay respectable returns. Over time, as the technology continues to mature, as the advantages of scale economics increase, as infrastructure and knowledge develop, more applications will pay more handsome returns. The key to achieving those returns is understanding when and where to invest.
It’s true that one-size-fits-all does not apply to RFID and EPC solutions. Each type of need should be addressed individually. It’s also true that one-size-fits-all does not apply to RFID and EPC business cases. The business case for each situation needs to be considered individually. There’s no valor in forging ahead with a deployment that doesn’t make business sense, and then later encountering the harsh reality of economics. It’s better to do careful business analysis and invest accordingly. It’s better to get a solid business case, one way or the other, and heed the business case decide.
After much anticipation about employing the perfect marriage of EPC and RFID, the conclusion to forego RFID is on one hand, a disappointment. Even my friend’s company, with significant resources to plan and execute for large-scale and long-term, couldn’t make the business case work for item-level tagging. It’s disappointing at first, but on the other hand, deferring to business case over emotional attachment to technology deserves much respect.
When the business case doesn’t make sense, it’s best to call off the deployment early and avoid the more painful reality of bad economics later in the deployment. Moving ahead when the business case doesn’t make sense only results in high-visibility, costly failures. Failure to heed a bad business case will trigger a “gun shy” attitude and undermine support for future RFID deployments, even when they do make business sense. Failure to heed a bad business case will also present an unwarranted warning to others that will bias their intuition against RFID projects.
Asset tracking with RFID can pay highly-respectable returns. Pallet tagging, case tagging, and a wide range of other RFID applications can pay highly-respectable returns. In spite of my friend’s company deciding against it, item level tagging can, whether today or in the future, also pay respectable returns. Over time, as the technology continues to mature, as the advantages of scale economics increase, as infrastructure and knowledge develop, more applications will pay more handsome returns. The key to achieving those returns is understanding when and where to invest.
It’s true that one-size-fits-all does not apply to RFID and EPC solutions. Each type of need should be addressed individually. It’s also true that one-size-fits-all does not apply to RFID and EPC business cases. The business case for each situation needs to be considered individually. There’s no valor in forging ahead with a deployment that doesn’t make business sense, and then later encountering the harsh reality of economics. It’s better to do careful business analysis and invest accordingly. It’s better to get a solid business case, one way or the other, and heed the business case decide.
Sunday, May 9, 2010
EPC Changing the World in Three Arenas
Yes, [RFID and] EPC technologies will fundamentally change the world. Only time will reveal the specifics, but success in three EPC investment arenas will influence the future. In one arena, investments are made with the interest of individual enterprises as a primary consideration. In a second arena, investments are made to serve an industry by using a shared infrastructure. In a third arena, investments are made to provide uniform services to the global public.
There will be many payoffs, and some losses, in each of the three EPC investment arenas. The payoffs will accelerate to the extent investments in the three arenas are coordinated. Ken Traub is shaping and galvanizing standards (e.g., EPCIS) that will facilitate that coordination. Nobody has a crystal ball, but Ken has his finger on the pulse of EPC adoption. Ken and I spoke recently about the state of world-wide EPC adoption and this blog post is partly a reflection on my conversation with Ken.
Although complex by any measure, the first arena of enterprise-focused activity is an easier problem to define. Customer-premises-based or private-cloud solutions are a natural response to these enterprise-focused problems. IBM, SAP, and Axway, among others, are leveraging strategic competencies and making investments with emphasis in this first arena.
Relatively-speaking, it’s easier to define and respond to enterprise-oriented problems, but industry orientation provides the opportunity for additional benefits. Hosted and software-as-a-service solutions provide advantages for industry oriented solutions via neutral-party-information-sharing, shared cost of capital, and easier-to-manage risk profiles. TraceTracker’s GTNet and FSE’s GDSN pool provide examples of investment in this second arena in concert with the food and beverage community.
The third arena, uniform services for the public, envisions a day when the need to exchange information about RFID tags and EPCs is common and routine. In anticipation of this common need, an open-loop, general-purpose, publicly-accessible service is appropriate. VeriSign shares this vision and is committed to providing Object Naming Service (ONS) to connect interested parties with information about individual EPCs.
The players mentioned as examples above and many others are managing investments and dependencies in the three arenas. To enable and re-enforce their efforts, standards for EPCIS, EPC Discovery, GDSN, and ONS hold the promise for additional returns via increased interoperability among investments. Those leading the charge in the three arenas and those dedicated to standards are setting the stage that will change global productivity and fundamentally change the world.
There will be many payoffs, and some losses, in each of the three EPC investment arenas. The payoffs will accelerate to the extent investments in the three arenas are coordinated. Ken Traub is shaping and galvanizing standards (e.g., EPCIS) that will facilitate that coordination. Nobody has a crystal ball, but Ken has his finger on the pulse of EPC adoption. Ken and I spoke recently about the state of world-wide EPC adoption and this blog post is partly a reflection on my conversation with Ken.
Although complex by any measure, the first arena of enterprise-focused activity is an easier problem to define. Customer-premises-based or private-cloud solutions are a natural response to these enterprise-focused problems. IBM, SAP, and Axway, among others, are leveraging strategic competencies and making investments with emphasis in this first arena.
Relatively-speaking, it’s easier to define and respond to enterprise-oriented problems, but industry orientation provides the opportunity for additional benefits. Hosted and software-as-a-service solutions provide advantages for industry oriented solutions via neutral-party-information-sharing, shared cost of capital, and easier-to-manage risk profiles. TraceTracker’s GTNet and FSE’s GDSN pool provide examples of investment in this second arena in concert with the food and beverage community.
The third arena, uniform services for the public, envisions a day when the need to exchange information about RFID tags and EPCs is common and routine. In anticipation of this common need, an open-loop, general-purpose, publicly-accessible service is appropriate. VeriSign shares this vision and is committed to providing Object Naming Service (ONS) to connect interested parties with information about individual EPCs.
The players mentioned as examples above and many others are managing investments and dependencies in the three arenas. To enable and re-enforce their efforts, standards for EPCIS, EPC Discovery, GDSN, and ONS hold the promise for additional returns via increased interoperability among investments. Those leading the charge in the three arenas and those dedicated to standards are setting the stage that will change global productivity and fundamentally change the world.
Sunday, May 2, 2010
How are the RFID and EPC Adoption Models Different than Adoption Models for Other Products?
This week, RFID Journal will host a webinar featuring Geoffrey Moore. I was first introduced to Geoffrey by Jeff Miller at Documentum. Geoffrey has written landmark books on how new technologies are adopted, including Crossing the Chasm and Inside the Tornado. I look forward to catching up with Geoffrey's latest ideas applied to RFID on the webinar.
In anticipation of the webinar, I formed up some questions that I hope Geoffrey will speak to. Technology adoption models presented in "Crossing the Chasm" and "Inside the Tornado" are mainstream ideas for tangible products, software, and services. Some products provide most or all of their value through "network effects". Network effects occur when the return to an individual or single organization is dependent on the adoption decisions of others. My questions center around the notion that different adoption models apply when network effects contribute a large share of a technology's value:
- How do you see network effects impacting RFID adoption?
- To what extent is adoption of EPCIS, ONS, GDSN, and EPC Discovery governed by network effects?
- How is the adoption model for network-effect technologies different, and how should those differences be managed in the case of RIFD, EPC, and related technologies?
I’ll report back in this space with more related to the webinar with Geoffrey and on the questions above.
In anticipation of the webinar, I formed up some questions that I hope Geoffrey will speak to. Technology adoption models presented in "Crossing the Chasm" and "Inside the Tornado" are mainstream ideas for tangible products, software, and services. Some products provide most or all of their value through "network effects". Network effects occur when the return to an individual or single organization is dependent on the adoption decisions of others. My questions center around the notion that different adoption models apply when network effects contribute a large share of a technology's value:
- How do you see network effects impacting RFID adoption?
- To what extent is adoption of EPCIS, ONS, GDSN, and EPC Discovery governed by network effects?
- How is the adoption model for network-effect technologies different, and how should those differences be managed in the case of RIFD, EPC, and related technologies?
I’ll report back in this space with more related to the webinar with Geoffrey and on the questions above.
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