The RFID Benchmark Report
Finding the Technology’s Tipping Point




             December 2005




            — Sponsore...
The RFID Benchmark Report




                  About the Publication Partners




RFID Update is the RFID industry daily....
The RFID Benchmark Report




                                          Executive Summary



        T       hough still i...
The RFID Benchmark Report



Technology, however, isn’t the only issue blocking wider adoption of RFID. Particularly
for t...
The RFID Benchmark Report



             •   Link RFID with other strategic IT initiatives
                 While establi...
The RFID Benchmark Report




                              Table of Contents

Executive Summary ............................
The RFID Benchmark Report




                                           Table of Contents

                Appendix A: Re...
The RFID Benchmark Report




                                             Figures

Figure 1: RFID Investment Plans for Ne...
The RFID Benchmark Report




                                              Chapter One:
                                 ...
The RFID Benchmark Report



        Figure 2: Top Obstacles to RFID Adoption

                              Poor tag read...
The RFID Benchmark Report



Don’t Paint All RFID Projects with the Brush of EPC
Companies are implementing RFID projects ...
The RFID Benchmark Report




                                             Chapter Two:
                                  ...
The RFID Benchmark Report



that the anticipated benefits of planned technology investments can be benchmarked
against cu...
The RFID Benchmark Report



        Tipping Point Requires More Than a Compelling Value Proposition
        While market ...
The RFID Benchmark Report




                                               Chapter Three:
                              ...
The RFID Benchmark Report



        Table 3: RFID Technology Investments in Next 12 to 24 Months
                RFID Tec...
The RFID Benchmark Report



Figure 4: Market Makers’ Current and Future External Spending

                       50%
   ...
The RFID Benchmark Report



        deployment decisions their customers are making (Figure 5). Infrastructure vendors in...
The RFID Benchmark Report



Table 4: PACE (Pressures, Actions, Capabilities, Enablers)

Prioritized            Prioritize...
The RFID Benchmark Report



        Compliance Isn’t the Only Driver of RFID Adoption
        Almost 42% of survey respon...
The RFID Benchmark Report




                                     Chapter Four:
                               Recommenda...
The RFID Benchmark Report



        Market Laggard Next Steps
             1. Reevaluate your position on RFID
          ...
The RFID Benchmark Report




                            Featured Sponsors




Omnitrol Networks is delivering the indust...
The RFID Benchmark Report




        Unisys is a worldwide information technology services and solutions company. Our
   ...
The RFID Benchmark Report




                           Sponsor Directory

Omnitrol Networks, Inc.                     Pr...
The RFID Benchmark Report




                                           Author Profile

        John Fontanella,
        ...
The RFID Benchmark Report




                             Appendix A:
                        Research Methodology



B  ...
The RFID Benchmark Report



             •   Company size: About 26% of respondents were from large enterprises (annual
 ...
The RFID Benchmark Report




                        Appendix B:
             Related Aberdeen Research & Tools

Related ...
The RFID Benchmark Report




                                                  About
                                    ...
The RFID Benchmark Report




AberdeenGroup, Inc.                              Founded in 1988, AberdeenGroup is the techn...
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The RFID Benchmark Report: Finding the Technologys Tipping Point

  1. 1. The RFID Benchmark Report Finding the Technology’s Tipping Point December 2005 — Sponsored by —
  2. 2. The RFID Benchmark Report About the Publication Partners RFID Update is the RFID industry daily. Trusted since 1946, Modern Materials Han- Launched in early 2004 to provide timely dling reaches professionals who recommend, analysis of RFID industry news, RFID select, or buy materials handling solutions Update publishes editorial briefings every weekday for the growing ranks of for large manufacturing, warehousing, and top level executives involved in the de- distribution facilities. Modern covers the ployment of RFID. Each issue delivers movement, storage, control, and protection the breaking news and analysis most per- of products throughout the supply chain. tinent to successful RFID implementa- Modern and MMH.com, provides the most tions, allowing readers to understand comprehensive coverage of the materials global RFID developments as they hap- handling field. pen. The circulation of more than 10,000 readers has grown rapidly as a result of insightful editorial and in close partner- ship with the leading RFID discussion forum, RFID Talk (www.rfidtalk.com). The executives that subscribe to RFID Update are highly involved in the publi- cation and eager to learn more about key industry players, new products and ser- vices, and upcoming conferences and events. The active readership yields con- sistently strong clickthrough and open rates, and the organic word-of-mouth enthusiasm ensures RFID Update's con- tinued role as the industry's leading email publication. All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • i
  3. 3. The RFID Benchmark Report Executive Summary T hough still in its relative infancy, Radio Frequency Identification (RFID) has be- come a controversial topic among the media, technology, and business communi- ties. Evangelists trumpet its capabilities and potential, while detractors attack it as being invasive and unable to deliver on its promised benefits. To find the right perspec- tive with which to view it, AberdeenGroup, in conjunction with publication partners RFID Update and Modern Materials Handling, surveyed 250 industry executives and managers on how their companies view RFID as an enabling technology, both in its abil- ity to deliver value today and in the future. The responses we received tell us much about the strengths and weaknesses of the RFID market, and what combination of events and technical advances would create a much broader adoption of the technology in the future. Key Business Value Findings Survey participants made one thing very clear: RFID is here to stay (Figure 1). The sur- vey results also tell us much of what it will take to motivate broad adoption across enter- prises, moving passive adopters to active proponents. Characterizing RFID as merely a data collection technology is a gross understatement of its abilities, especially if we use the term “data collection” in the conventional sense of meaning identification only. RFID gives us a multi-dimensional view of status, location, condition, and state of people, process, and product. Until this can be fully exploited through the use of technology-based applications, analytical tools, and hardened enter- prise-scale technical infrastructure (all only starting to be developed now), adoption rates won’t meet the expectations most market watchers set. Figure 1: RFID Investment Plans for Next Three Years Will put pilots into Will not invest in My company sees production in the RFID definite next 12 1% advantages and months will increase 23% investment in RFID 29% Will do whatever Minimal investment is necessary to until technology comply with matures customer and 23% government mandates 24% Source: AberdeenGroup, December 2005 All print and electronic rights are the property of AberdeenGroup © 2005. ii • AberdeenGroup
  4. 4. The RFID Benchmark Report Technology, however, isn’t the only issue blocking wider adoption of RFID. Particularly for those companies involved in industry-wide solution deployments, new business mod- els and processes are being developed in parallel with the technology supporting them. This is a high-risk, high-reward endeavor that relatively few companies are eager or ca- pable of leading. This is not to say that every RFID implementation carries extremely high risk. We found many companies that had implemented the technology to enhance a current, well- structured process, and they were very satisfied with the results they realized. Asset man- agement was, by far, the leading application of the technology in these cases, followed by production, transportation and security. Implications & Analysis Regardless of whether adoption is being driven by mandate or companies seeking to raise internal performance levels, the survey reports a growing number of enterprises ready to launch new RFID pilots in the next 12 months. Results show that many companies expect to spend, on average, more than twice what they are now spending on external services and technologies. This is a key indicator of market growth, one we expect to see increase as technologies and processes mature. Network management, storage, EAI, and even ERP vendors have been slow to support RFID initiatives. No more than 15% of companies participating in the survey felt tech- nology firms in these categories were very helpful in their RFID deployments. It is unlikely this condition will continue. Major technology companies have announced broad-ranging initiatives to build the ecosystem necessary to mainstream the technology. And start-ups continue to receive venture funding to fill the voids left by larger compa- nies. The market recognizes that the challenges and opportunities go well beyond just overcoming the limitations presented by the laws of physics at a loading dock or produc- tion line. A whole second wave of process and technical development is under way, one that is necessary for the growth of RFID. Recommendations for Action RFID has made significant strides in the past three years. We are still in the early stages of extracting its maximum benefits. The following are recommendations for building a go-forward strategy on RFID adoption: • Reevaluate your position on RFID adoption When a technology reaches its tipping point, moving from unique to ubiquitous, its adoption grows at a very rapid pace. RFID is not for every company, but in industries that will reach the tipping point first, a late start could mean competi- tive disadvantage. • Identify who the real stakeholders are in RFID pilots In the Wal-Mart RFID pilot, most of the predicted near-term value will accrue to sales and marketing within a supplier, yet it is regarded as largely an internal op- erations initiative. Several leading companies have given oversight responsibili- ties to their sales and marketing organizations, so that not only cost but benefit will be recognized, giving the company a balanced view of progress. All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • iii
  5. 5. The RFID Benchmark Report • Link RFID with other strategic IT initiatives While establishing viable value propositions for RFID is a difficult task, don’t miss the fact that the technology is part of a much larger wave of change affect- ing all enterprise technology with the adoption of service oriented architecture (SOA). All print and electronic rights are the property of AberdeenGroup © 2005. iv • AberdeenGroup
  6. 6. The RFID Benchmark Report Table of Contents Executive Summary .............................................................................................. i Key Business Value Findings..........................................................................ii Implications & Analysis ..................................................................................iii Recommendations for Action.........................................................................iii Chapter One: Issue at Hand.................................................................................1 Companies Believe in the RFID Vision, but Lack a Compelling Reason to Get There .................................................................. 1 Customer Mandates Provide Urgency for RFID Adoption, but Won’t Sustain it ....................................................... 2 Don’t Paint All RFID Projects with the Brush of EPC ..................................... 3 Finding RFID’s Tipping Point ......................................................................... 3 Chapter Two: Key Business Value Findings .........................................................4 Enterprise Investment Strategies Dictate RFID Adoption Approach .............. 4 Tipping Point Requires More Than a Compelling Value Proposition ....... 6 Chapter Three: Implications & Analysis...............................................................7 RFID Infrastructure Investments on the Rise................................................. 7 Spending on External Resources and Technology is Growing ................ 8 As RFID Evolves, So Must Related Technologies................................... 9 Pressures, Actions, Capabilities, Enablers (PACE)...................................... 10 Options to Minimize Cost When Complying with RFID Mandates............................................................ 11 Compliance Isn’t the Only Driver of RFID Adoption............................... 12 How Close is RFID’s Tipping Point? ............................................................ 12 Chapter Four: Recommendations for Action ...................................................... 13 Market Laggard Next Steps ......................................................................... 14 Market Opportunist Next Steps.................................................................... 14 Market Maker Next Steps ............................................................................ 14 Featured Sponsors............................................................................................. 15 Sponsor Directory .............................................................................................. 17 Author Profile ..................................................................................................... 18 All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup
  7. 7. The RFID Benchmark Report Table of Contents Appendix A: Research Methodology .................................................................. 19 Appendix B: Related Aberdeen Research & Tools ............................................. 21 About AberdeenGroup ...................................................................................... 22 All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup
  8. 8. The RFID Benchmark Report Figures Figure 1: RFID Investment Plans for Next Three Years........................................ ii Figure 2: Top Obstacles to RFID Adoption ...........................................................2 Figure 3. Managing RFID Innovation....................................................................6 Figure 4: Market Makers’ Current and Future External Spending ........................9 Figure 5: Level of Technology Vendors’ Assistance in RFID Implementation ......................................................................................... 10 Tables Table 1: Comparing Market Makers and Market Opportunists Approach to RFID ................................................................................................5 Table 2: RFID Implementation Challenges and Responses .................................7 Table 3: RFID Technology Investments in Next 12 to 24 Months .........................8 Table 4: PACE (Pressures, Actions, Capabilities, Enablers)............................... 11 Table 5: Different Approaches to RFID Adoption ................................................ 13 All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup
  9. 9. The RFID Benchmark Report Chapter One: Issue at Hand Key Takeaways • Most companies buy into the RFID vision. • The legacy of forced adoption still follows RFID. • Don’t paint all RFID projects with the same brush. • Mandates provide urgency, but more is needed to create the tipping point. F or the first time ever, a new technology offers companies the opportunity to moni- tor and manage the location, state, status, and condition of products, assets, and even people, bringing process automation to a level unthinkable just a few years ago. It’s tough to argue against having these capabilities, but most companies are stymied on how to successfully integrate RFID into their current business processes. Companies Believe in the RFID Vision, but Lack a Compelling Reason to Get There PACE Key — For more detailed descrip- For better or worse, the Wal-Mart mandate tion see Appendix A made the world stand up and take notice of Aberdeen applies a methodology to benchmark RFID. Suppliers of the retail giant were re- research that evaluates the business pressures, quired to implement an immature technology actions, capabilities, and enablers (PACE) that with little understanding of how it would indicate corporate behavior in specific business benefit themselves or their customer. This processes. These terms are defined as follows: legacy of forced adoption still exists, with Pressures — external forces that impact an more than 50% of respondents saying that the organization’s market position, competitiveness, inability to create an internal value proposi- or business operations tion for RFID is the single most difficult ob- stacle in creating greater support internally Actions — the strategic approaches an organi- zation takes in response to industry pressures for further adoption of the technology (Figure 2). Despite the presence of this formidable Capabilities — the business process competen- obstacle in the short term, the survey also cies required to execute corporate strategy points out that there is still an undercurrent of Enablers — the key functionality of technology optimism about RFID. Almost 60% of senior solutions required to support the organization’s management surveyed says it holds great po- enabling business practices tential value for their companies, and two- thirds also feel RFID would help them create significant differentiation in their business processes. Disillusionment in the present and yielding to optimism for the future are difficult positions to reconcile, leaving open the question of how companies will make the leap. This is the source of the confusion that plagues RFID today. All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 1
  10. 10. The RFID Benchmark Report Figure 2: Top Obstacles to RFID Adoption Poor tag read rates No compelling 22% value proposition Cost of RFID 52% tags 34% Cost of RFID Lack of global infrastructure standards 36% 34% Source: AberdeenGroup, December 2005 Customer Mandates Provide Urgency for RFID Adoption, but Won’t Sustain it The power of customer mandates is the momentum builder in the RFID market today. Nearly a quarter of all respondents say they will do whatever their customers request of them, regardless of what internal benefits they receive. However, the majority of respon- dents aren’t as passive in their views about RFID adoption. Forty-four percent believe RFID will make their companies more attractive to do business with, and another 25% indicate RFID will be a requirement of doing business in the next two years. Only a small minority of companies feel supplier and customer relationships would not be impacted by not implementing RFID. Complying with customer requirements provides the impetus for RFID implementation in the short term, but companies want to capture more value from it than just improving customer relationships. Over half of our respondents are not satisfied with simply imple- menting “slap and ship” programs to satisfy customer mandates, but are actively looking for other ways to create value with RFID. Two-thirds of companies with revenues of more than $1 billion, for example, say they want to use RFID to improve visibility into the status of direct material and services over multiple facilities as well as meet customer requirements. All parties receiving mutual benefit from deploying RFID is a key compo- nent in having the technology realize faster adoption rates than its use being driven by mandate alone. Survey respondents also told us cost and ease of implementation and use are critical fac- tors in adoption. Two-thirds of all respondents said price was the leading criteria for se- lection of what hardware, software, or services they would use within their initiatives. Experience counts too: More than half of our survey respondents rank implementation track records as being the second most important element in making vendor-selection decisions of vendors. Finally, 45% said a vendor’s ability to offer bundled services in- cluding software, tags, readers, and implementation services is a very important part of the selection criteria. All print and electronic rights are the property of AberdeenGroup © 2005. 2 • AberdeenGroup
  11. 11. The RFID Benchmark Report Don’t Paint All RFID Projects with the Brush of EPC Companies are implementing RFID projects today and receiving benefits. Cross-industry initiatives are ambitious programs, ones whose success is predicated on accepting indus- try-wide standards and collaborative working relationships between supplier and retailer. The AberdeenGroup survey finds, though, that companies implementing RFID outside the orbit of Wal-Mart pilots face a less complex task. Almost a third of discrete manufac- turing companies responding to the survey use some variant of RFID technology to man- age company assets, and, in the process, claim improved internal operations performance. A quarter of respondents say RFID has allowed them to improve security and integrity of products and process, and nearly the same number say it has helped them improve man- agement of the flow of goods outside the enterprise. Rather than shirk from investment in RFID, these companies are active and voluntary users of the technology. Finding RFID’s Tipping Point In the process of writing this report, interviews were conducted with industry, govern- ment, and technology leaders to find what they thought would be the combination of events that would lead to the tipping point of RFID, in which the technology moves from being unique to ubiquitous. Some said the tipping point has already been reached with the announcement of the Wal-Mart mandate or the ratification of the Gen 2 and ALE standards in 2005. Others believe increased adoption of RFID by retailers will accelerate growth. All are critical factors in the evolution of RFID, but tipping points are rarely rec- ognized until long after the events they trigger transpire. From survey responses, it is clear that no one event will trigger its tipping point. Rather, it will be the result of a com- bination of factors, many of which we are only starting to think about today. Survey participants see a growing role for RFID in the future, with the implication that a tipping point will be reached when the use of the technology will become a very real op- tion to increase top- and bottom-line growth. These predictions, though, ring hollow, if compelling value propositions, along with supporting technologies, aren’t introduced to accelerate RFID’s adoption rate. All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 3
  12. 12. The RFID Benchmark Report Chapter Two: Key Business Value Findings Key Takeaways • Market makers focus on future value of investment. • Market opportunists want return on investment from RFID now. • Market laggards are indifferent to RFID advances. C ompanies are taking different approaches to meeting the challenge of creating compelling value propositions for RFID adoption. In some cases, this challenge rests solely in the hands of an individual enterprise. In others, such as EPC, an entire industry must work in tandem to realize the benefits envisioned for the future. Un- derstanding what motivates individual companies to adopt new technologies is the first step in charting the growth path for RFID. Enterprise Investment Strategies Dictate RFID Adoption Approach The AberdeenGroup RFID benchmark survey found that there are three distinct ap- proaches companies are taking to justify their investment in and deployment of RFID. Most respondents say they will meet the requirements dictated by customer or regulatory mandates, but must be able to build a convincing case for return on investment before RFID initiatives are expanded. Others say they refuse to initiate RFID projects until the technology matures. A smaller, but significant minority of respondents, though, continue to invest in RFID despite the Competitive Framework fact that expected benefits aren’t easily quantified. The three Key different approaches can be characterized as follows: The Aberdeen Competitive Market Makers – Companies willing to invest in new proc- Framework defines enter- esses and technologies without an immediate promise of prises as falling into one of ROI. Companies in this category are similar to venture capi- the three following levels of talists in how they approach and manage technology invest- practices and performance: ments, funding projects whose future rates of return are Market Laggards (30%) — predicated on what could happen versus, with a high amount practices that are signifi- of certainty, what will happen. Companies in this category cantly behind the average are confident in their abilities to develop innovative proc- of the industry esses and technologies that create market differentiation. Market Makers are critical to the development of initiatives Market Opportunists (50%) such as EPC, in which both process and technology have to —practices that represent be created in parallel. the average or norm Market Opportunists – These companies require a clear Market Makers (20%) — understanding of investment return and risks associated with Practices that lead the in- any technology investment. By definition, their investment dustry strategy dictates that processes must already be in place so All print and electronic rights are the property of AberdeenGroup © 2005. 4 • AberdeenGroup
  13. 13. The RFID Benchmark Report that the anticipated benefits of planned technology investments can be benchmarked against current state process performance. It’s no surprise that this group leads in imple- menting RFID for uses such as production or asset management, using it to automate processes already well established. For the same reason, this group is most vocal about lack of ROI in RFID, and the one most directly affected by the success or failure of Mar- ket Maker initiatives. Market Laggards – Companies in this class are indifferent to RFID advances in the near term, and can only be looked on as a viable market when the risk, cost, and return of RFID implementations is already well established by market makers and opportunists. As can be seen in Table 1, there is a definite difference in the way companies defined by their survey responses as Market Makers approach RFID implementation. Market Mak- ers have more experience with RFID, are less likely to require ROI analysis to get in- volved, and are the most aggressive in building a strong core of internal expertise in RFID. Perhaps the most telling indicator of when companies are ready to put RFID plans into action is the amount of budget earmarked to be spent outside the enterprise. Market Makers hold a significant lead in both current and future external spending. Finally, and not surprisingly, Market Makers are much more optimistic on the effect the results of RFID will have on top-line revenue growth. Table 1: Comparing Market Makers and Market Opportunists Approach to RFID Market Market Makers Opportunists RFID pilots in place over 12 months 53% 31% Justified RFID investment with ROI calculation 58% 73% Build internal RFID expertise 78% 60% No plans to increase scope of RFID rollout 8% 23% Price most important selection criteria when buying technology and services 55% 69% Percent of companies currently spending more than10% on external services and technology 49% 34% Percent of companies planning to spend more than10% on external services and technology in next 12 months 82% 69% Percent of companies that believe RFID will make them more attrac- tive to do business with 55% 31% Source: AberdeenGroup, December 2005 All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 5
  14. 14. The RFID Benchmark Report Tipping Point Requires More Than a Compelling Value Proposition While market makers work on developing the value propositions that make RFID adop- tion attractive, their participation also encourages investing in technologies necessary to make additional growth possible. Figure 3 addresses how the three classes of companies manage innovation and what the catalysts are doing to bring RFID to its tipping point. Figure 3. Managing RFID Innovation High ati y ov log on Inn chno Market Te Perceived Makers Value of Innovation Market Opportunists ss ce on ro vati P o n In Market Laggards Low Willingness to Innovate High Source: AberdeenGroup, December 2005 The establishment of new business models and technical advances that will cause market opportunists to adopt RFID much faster represents the true tipping point. To achieve this goal, and establish RFID as the game-changing technology its supporters view it as, will take not only market makers driving process innovation but also subsidizing the techno- logical ecosystem that makes its cost and risk to implement much lower. Much has been done on the process innovation side. As we saw, companies implementing closed-loop RFID processes are already finding value. The early experiences of market-making re- tailers and suppliers improving store fill rate and promotional compliance by using RFID tells us that the compelling value proposition is not out of reach. Now, it’s time to focus on building the applications, analytical tools, and technical infrastructure that will allow companies to scale up implementations and receive the maximum benefit from RFID technology. All print and electronic rights are the property of AberdeenGroup © 2005. 6 • AberdeenGroup
  15. 15. The RFID Benchmark Report Chapter Three: Implications & Analysis Key Takeaways • Investments in technology infrastructure are on the rise. • Spending on external RFID services and technologies will rise 30% in the next 12 months. • New options to simplify RFID implementation are coming on the market. A ccording to the results of our survey, many companies are only now starting to think about the technical infrastructure that serves as the underpinning of a large- scale RFID deployment. To date, most of the attention has been spent on solving the issues that the limitations of the physics of RFID present (Table 2). Table 2: RFID Implementation Challenges and Responses Challenges % Selected Responses to Challenges % Selected 1. Poor performance of RFID hard- 41% 1. Delay investment in and piloting of 28% ware and tags RFID 2. Technical immaturity of RFID mid- 39% 2. Keep RFID projects in pilot stage 48% dleware 3. Lack of RFID turnkey solution 37% 3. Build up internal RFID expertise 73% 4. Unrealistic expectations set by tech- 28% 4. Verify vendor claims with other 25% nology vendors customers or third-party sources 5. Finding information to build a road- 25% 4. Join professional or industry or- 21% map for RFID implementation ganization dedicated to RFID 6. Inexperienced consult- 20% 6. Change consultants/integrators 4% ants/integrators Source: AberdeenGroup, December 2005 While the RFID community at large will continue to develop better methods and tech- nologies to improve performance and accuracy at the tag and reader level, companies are preparing for the next challenge they will face, creating the technical infrastructure re- quired to manage RFID deployments on a wide scale. RFID Infrastructure Investments on the Rise It’s clear from the results of our survey that respondents will be investing more in the infrastructure and tools required to manage a large network of RFID readers and its asso- ciated data (Table 3). Topping the list of investment items are network tools to manage routing of information, and quite possibly the deployment and ongoing maintenance of All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 7
  16. 16. The RFID Benchmark Report Table 3: RFID Technology Investments in Next 12 to 24 Months RFID Technology Solution Area % Selected RFID-specific network management tools 53% RFID portal technology 46% Upgraded network management tools 44% Third-party RFID middleware 42% Middleware pre-integrated by application vendor 39% Consultant and integrator services 30% Object Naming Service 28% On Demand `slap and ship’ services 26% Source: AberdeenGroup, December 2005 hundreds, if not thousands, of readers. To date, this area has received very little attention for implementers, with only 15% saying they are making RFID-specific investments, most of that to support RFID asset management programs. There also is a significant up- tick in the purchase of RFID portals, from 26% today to 46% in the next two years. This reflects additional pilot projects coming online, broadening the scope of current imple- mentations, and a migration away from simple “slap and ship” processes as companies begin to optimize internal processes around RFID. Users are still unsure of the state of RFID middleware in the future. Roughly 40% are betting that their enterprise applications will come RFID-ready. This is particularly true for the smallest enterprise users surveyed, 70% of whom expect RFID initiatives to be supported by their ERP vendors in the future. Mid-size enterprises ─ by a small percent- age ─ opt for independent RFID middleware companies. This will likely be a moot point in two years as these technology vendors will either be absorbed by enterprise application companies or sell their products through their distribution channels. The use of RFID consultants and integrators will decrease from nearly 50% today to 30% over the next two years. This is hardly surprising given the amount of attention compa- nies are paying to developing internal expertise with the technology. The role of the con- sultant and integrator is changing, going from one of technician to a more strategic re- source to help chart the roadmap for companies to begin adopting the new business mod- els that will inevitably be introduced. The last two investment areas, the Object Name Service (ONS) and On Demand RFID services, are still in their relative infancy. ONS is still ahead of its time. As a simple approach to meet RFID compliance requirements, On Demand RFID services should see market growth over the next two years. Spending on External Resources and Technology is Growing One of the best indicators to gauge the growth of RFID is to measure current and planned spending for the procurement of services and technology outside the enterprise. Not sur- prisingly, market makers are most aggressive in this area (Figure 4), but our survey also reflects an increase in external spending by market opportunists and even laggards. All print and electronic rights are the property of AberdeenGroup © 2005. 8 • AberdeenGroup
  17. 17. The RFID Benchmark Report Figure 4: Market Makers’ Current and Future External Spending 50% More than 40% of 42% 42% companies will be Percent of Companies 40% spending up to 30% of their RFID budget 30% 26% on external services 24% in 2006 20% 17% 18% 12% 8% 10% 4% 2% 0% < 10% 10% to 31% to 51% to 70% to 30% 50% 70% 100% Current External Spending External Spending for next 12 months Source: AberdeenGroup, December 2005 Forty-two percent of market makers reported spending less than 10% of their RFID budget on external services and technologies this year. They tell us, though, that over the next 12 months, external spending will increase, with more than 40% of companies say- ing they will spend between 10% and 30% of their RFID budgets on external services and technology. Three-quarters of all companies responding to the survey who reported current external spending of less than 10% of their RFID budgets say they will increase outside expendi- tures 30% in the coming year. Almost half of the companies reporting no external spend- ing this year plan to spend at least 10% of their budgets on technology and services over the next 12 months. As for laggards, customer mandates are forcing them to move beyond evaluation and be- gin implementation. The number of companies reporting no planned external spending over the next year dropped more than a third, and 25% of laggard companies plan on spending between 11% and 20% on outside services and technologies in the next 12 months. As RFID Evolves, So Must Related Technologies Most established enterprise technology vendors have been slow to develop products and services that can maximize the value of RFID’s unique capabilities. Content to treat RFID as a variation of bar code technology, a lack of standards and the absence of a value proposition that would drive wide adoption discouraged further investment. This lack of commitment to RFID is reflected in the survey responses we received. Tech- nology companies have a lot of ground to make up if they want to influence the RFID All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 9
  18. 18. The RFID Benchmark Report deployment decisions their customers are making (Figure 5). Infrastructure vendors in network management and storage received low marks in providing meaningful help for RFID deployments. EAI vendors did not fare much better, and surprisingly, only 15% of respondents felt their ERP vendors were very helpful guiding RFID implementations. Figure 5: Level of Technology Vendors’ Assistance in RFID Implementation 12% Storage Vendors 22% 66% 9% EAI Vendors 36% 55% 13% Network Mangement Vendors 27% 61% 15% ERP Vendors 46% 38% Very helpful 34% Warehouse Management System Vendors 38% Somewhat helpful 28% Not helpful at all 30% Systems Integrators 54% 16% 39% RFID Reader Vendors 53% 8% 36% RFID Tag Vendors 51% 13% 32% RFID Middleware Vendors 53% 15% 0% 10% 20% 30% 40% 50% 60% 70% Source: AberdeenGroup, December 2005 This is about to change. The ratification of the Gen 2 standard, which allows RFID read- ers to read any RFID tag, regardless of manufacturer, resulted in the market entry of lar- ger companies and a new wave of startups, focused not only on solving the immediate issues confronting RFID pilots, but also building the technology necessary to scale im- plementations out to the enterprise level and beyond. The ability to scale, and at the same time leverage the technology investments companies have already made, is critical to enable broader and more aggressive adoption of RFID. Pressures, Actions, Capabilities, Enablers (PACE) While customer mandates often force the first deployment of RFID, knowledge acquired during initial implementations helps create a greater understanding of the best uses of the technology and the opportunities it opens. The AberdeenGroup survey finds that many companies have passed the threshold of grudgingly meeting a customer’s service re- quirement and are actively looking for other areas to create value using RFID. The sur- vey also tells us that the decision-making process to decide whether to initiate or expand RFID deployments is unique to each company (Table 4). All print and electronic rights are the property of AberdeenGroup © 2005. 10 • AberdeenGroup
  19. 19. The RFID Benchmark Report Table 4: PACE (Pressures, Actions, Capabilities, Enablers) Prioritized Prioritized Prioritized Prioritized Pressures Actions Capabilities Enablers Meet RFID usage Implement RFID Consultants, ven- Bundled RFID technology to mandates pilot to satisfy cus- dors with prior launch a pilot. Also consider tomer mandates and hands-on experi- On Demand pilot services and gain experience ence implementing technology, and logistics RFID service providers Identify RFID value Search for existing In-house RFID ex- RFID technology purpose built propositions that business processes pertise, application, for particular tasks (e.g. asset could offer short- that would benefit and technology management, inventory visibil- term return on in- from RFID readiness ity, event monitoring, vestment to technology production) maximize ROI Preparing company Build business case Ability to transform Ongoing government and in- for its own RFID based on competi- business processes dustry mandates, test case tipping point tive impact of lead- and use technology results, technology enhance- ing or following as a competitive ment, falling price points, inter- RFID initiatives advantage nal expertise, technology stan- dards Create competitive Use acquired RFID Calculate value Global or de-facto standards, advantage to posi- knowledge and ex- based on future collaborative relationships with tively affect price, perience to establish stream of returns. industry peers, customers, revenue, security, new processes and Develop process suppliers and service provid- service capabilities and technology in ers, third-party service provid- parallel ers offering RFID-based ser- vices Source: AberdeenGroup, December 2005 Options to Minimize Cost When Complying with RFID Mandates To jump start RFID initiatives, consultants or integrators with previous RFID implemen- tation experience are frequently used. In fact, 65% of survey respondents say they re- tained outside assistance to plan and implement an RFID pilot. Companies also found RFID middleware, tag and reader vendors, as well as warehouse management vendors, either very or somewhat helpful in implementation. Since most pilots are focused around solving the issues arising from the constraints of the physics of RFID, it makes sense that these vendors are the first line of support in getting pilots up and operational. The mar- ketplace is further ahead in providing packaged solutions that include tags, readers, and the software necessary to collect product data. On Demand RFID services are also avail- able that allow for minimum initial outlay of capital . Finally, many companies are turn- ing to logistics service providers to apply tags to cases and pallets. This is particularly true of inbound shipments of goods sourced offshore. All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 11
  20. 20. The RFID Benchmark Report Compliance Isn’t the Only Driver of RFID Adoption Almost 42% of survey respondents say they are either in the process of implementing or investigating the use of RFID in applications that go beyond meeting the minimum re- quirements of compliance mandates. We found that this is a frequent outcome after a company gets exposure to and gains confidence in the technology. Finding existing proc- esses whose performance can be enhanced by RFID is generally the next step to take in RFID adoption. Our survey respondents cite use of RFID in asset management, manage- ment of inbound transportation, warehouse management and within the production cycle. We also found that size is not a factor in finding value with RFID. One small distributor we interviewed implemented RFID to eliminate $200,000 worth of inventory discrepan- cies and shrinkage of construction materials, whose physical properties such as weight and texture were nearly impossible to discern with the human eye. This example not only tells us that RFID delivers value in a controlled environment, but that cost of the technol- ogy is reaching a level where it’s not a barrier to an acceptable return on investment in even modest initiatives. How Close is RFID’s Tipping Point? The tipping point is not a question of if, but when. The easy answer to this is when the risk and expense of RFID adoption is exceeded by the benefit realized from it. The fol- lowing are a list of events that companies interviewed for this report say are important signals toward RFID reaching its tipping point: • Adoption by the International Organization for Standardization (ISO) of the EPC global Gen 2 protocol; • Compelling evidence that pilots being held now with major retailers in North America and Europe reach expectations set for them, are scalable, and can be replicated by other companies using available technologies; • Other broad initiatives, by the U.S. Department of Defense, third-party logistics companies, and cross industries, are successful in reaching their goals and value can be translated to a larger audience; • To leverage already installed technology, suppliers of enterprise technology offer products and services directly related to supporting RFID initiatives; • Analytics and software application vendors build product offerings that can take advantage of the full range of RFID capabilities; and • An increase in the number of retailers announcing RFID initiatives. All print and electronic rights are the property of AberdeenGroup © 2005. 12 • AberdeenGroup
  21. 21. The RFID Benchmark Report Chapter Four: Recommendations for Action Key Takeaways • Companies regard internal RFID expertise as a competitive advantage. • Market makers are using consultants to build strategic roadmaps. • A late start with RFID could put a company at a competitive disadvantage. A s we have seen, respondents to our survey take very different approaches to RFID adoption (Table 5). Market laggards would like to ignore the entire RFID phenomenon. Market opportunists are much more likely to adopt it, but require solid evidence that it will recognize ROI rapidly. Market makers have their eyes set on transforming today’s business processes in the hopes they can wring competitive advan- tage from it. Whether laggard, opportunist, or market maker, there are lessons to learn from the experiences of respondents to the Aberdeen survey. Table 5: Different Approaches to RFID Adoption Market Laggard Market Opportunist Market Maker RFID initiative focused on RFID initiative focused on RFID initiatives focused mandate meeting mandates and on meeting mandates, compliance improving internal opera- improving internal and Process tions external operations Either IT or business High reliance on outside Business and IT share likely to have sole re- consultants for RFID RFID implementation sponsibility for RFID implementation responsibilities; use Organization implementation consultants and integra- tors to develop strategic direction Least likely to build inter- Actively builds internal Regards internal RFID nal expertise in RFID; RFID expertise; prefer- expertise as competitive most likely to blame ven- ence for predefined im- advantage; actively mar- Knowledge dors for project plementation roadmaps kets RFID initiatives to shortcomings and turnkey solutions the company at large and external entities RFID data not used inter- RFID data integrated to Integrates with external nal to the company by internal systems systems to capture and any process or system distribute data collected Technology with RFID Source: AberdeenGroup, December 2005 All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 13
  22. 22. The RFID Benchmark Report Market Laggard Next Steps 1. Reevaluate your position on RFID RFID is not going away. By most accounts, when the technology does reach its tipping point, its use and adoption will grow at a very rapid pace. RFID is not for every company, but for industries that will reach the tipping point first, a late start could mean competitive disadvantage. 2. Experiment; it entails very little risk The RFID technology choices companies have today are much greater and much less costly than when the first wave of adopters began their pilots. Prices on readers and tags are dropping, and integrators are offering bundled services and technology at price points in the low five-figure range. On-Demand RFID is an- other option, with at least one vendor asking for no initial investment and pricing services and hardware on the rate of throughput. 3. Involve both business and IT in the pilot process RFID pilots are an investment in the future. Understanding the capabilities of RFID beyond identification is the value returned. Business operations and IT must participate in a coordinated fashion to translate capability into action and understand the steps required to maximize the benefit of data collected. Market Opportunist Next Steps 1. Identify who the real stakeholders are in RFID pilots In the Wal-Mart pilot, most of the predicted near-term value will accrue to sales and marketing within a supplier, yet it’s regarded as largely an internal opera- tions initiative. Several market makers have given oversight responsibilities to their sales and marketing organizations, so that not only cost but benefit will be recognized, giving the company a balanced view of progress. 2. Stay abreast of market developments The RFID market is moving quickly on all fronts. New and enhanced technolo- gies from enterprise application, analytics, infrastructure, and hardware vendors are aiming to change the cost/benefit and scalability equations of RFID. Market Maker Next Steps 1. Link RFID with other strategic IT initiatives While the task of establishing viable value propositions for RFID is daunting, don’t forget that the technology is part of a much larger wave of change affecting all enterprise technology. The adoption of service-oriented architecture (SOA) will change how applications and infrastructure are designed, deployed, and used. With it, the enterprise will have much greater flexibility in how it builds its processes, and gain the flexibility it will need to differentiate itself in the market- place. All print and electronic rights are the property of AberdeenGroup © 2005. 14 • AberdeenGroup
  23. 23. The RFID Benchmark Report Featured Sponsors Omnitrol Networks is delivering the industries first fully integrated RFID Network Ap- pliance, the RX1000™ that distributes business process logic over a powerful peer-to- peer networked federated data architecture. The RX1000™ seamlessly integrates RFID, Barcode, PLC’s and Sensor technologies with an open workflow service creation envi- ronment delivering real-time service execution intelligence at the edge. Omnitrol’s RX1000™ network solution delivers the first scalable and robust RFID Services Net- work that substantially simplifies deployment, reduces server load and expensive custom integration, radically reduces the capital and support costs and provides customers with an easily established return on their investments. The RX1000™ is a highly versatile middleware replacement solution that reduces the complexity and interoperability be- tween the legacy world of barcodes while incrementally evolving to the emerging world of EPC, RFID tags and technologies. Printronix Inc. is the world’s best-selling line matrix manufacturer and has earned an out- standing reputation for its high-performance thermal bar code and fanfold laser printers. In addition, Printronix adapts new technologies to create innovative solutions, including the new RFID SmartLine family of RFID Printers, Printer Applicators, and Smart Labels, and wireless mobile printers. Printronix’s integrated network solutions, such as Online Data Validation (ODV™) and PrintNet® Enterprise, improve the printing of bar codes, labels and forms while verifying accuracy and offering flawless diagnostic technology. Based in Irvine, Calif., Printronix has operations worldwide. For more information: www.printronix.com. All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 15
  24. 24. The RFID Benchmark Report Unisys is a worldwide information technology services and solutions company. Our people combine expertise in consulting, systems integration, outsourcing, infrastructure and server technology with precision thinking and relentless execution to help clients, in more than 100 countries, quickly and efficiently achieve competitive advantage. With Unisys Global Visible Commerce (GVC) solutions, organizations can drive greater performance through enhanced visibility and security. GVC solutions are designed to maintain visibility at every step along the value chain, from foreign points of origin to domestic store shelves. A combination of RFID tags and readers provide real-time location and condition data as raw materials, finished goods and people move on land, at sea or in the air, as well as at border crossings, manufacturing plants and distribution centers. No matter where your organization is on the adoption cycle – from risk assessment to pilot design to full implementation – Unisys visibility experts can help you realize full value from your investments in RFID and track-and-trace initiatives. Xterprise is a leading RFID Solution Provider and is currently providing a variety of mis- sion critical services to many of the Wal-Mart, Albertsons, Target and Best Buy suppliers striving toward retailer compliance. Our suite of supply chain solutions leverages RFID technology to serve a set of identified needs for the following markets: retail, supply chain visibility (logistics), food and pharmaceutical cold chain (temperature tracking) and a wide range of asset management solutions. Our engagements begin with consulting and run through implementation, systems integration followed by service and support. All print and electronic rights are the property of AberdeenGroup © 2005. 16 • AberdeenGroup
  25. 25. The RFID Benchmark Report Sponsor Directory Omnitrol Networks, Inc. Printronix Omnitrol Networks, Inc. Printronix 520 El Camino Real, 9th Floor 14600 Myford Road San Mateo, CA 94402 Irvine CA 92606 Tel: (510) 744-0450 714-368-2559 info@omnitrol.com despinosa@printronix.com www.omnitrol.com www.printronix.com Unisys Xterprise Unisys Xterprise Township Line & Union Meeting Rds-A 2304 Tarpley Unisys Way Suite 114 Blue Bell Pennsylvania 19424 Carrollton, TX 75006 United States 972.690.9460 x 300 1.800.874.8647 X747 GVCommerce@unisys.com info@xterprise.com www.unisys.com www.xterprise.com All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 17
  26. 26. The RFID Benchmark Report Author Profile John Fontanella, Senior Vice President & Research Director, Supply Chain Services AberdeenGroup, Inc. John Fontanella oversees research programs, products, and services, as well as client de- velopment related to Planning and Advanced Analytics, Global Manufacturing, Global Trade and Logistics, and Retail. Prior to joining Aberdeen, Fontanella was vice president of supply chain services at AMR Research and the Yankee Group. He has also led worldwide logistics for Microsoft Corp., and held a variety of operations and marketing positions at Digital Equipment Corp. All print and electronic rights are the property of AberdeenGroup © 2005. 18 • AberdeenGroup
  27. 27. The RFID Benchmark Report Appendix A: Research Methodology B etween October and November 2005, AberdeenGroup, RFID Update, and Mod- ern Materials Handling magazine examined the perceptions, experiences and intentions surrounding RFID at 246 enterprises in the retail, consumer goods, aerospace and defense, pharmaceutical, discrete and process manufacturing, and high tech industries. Responding supply chain, logistics, information technology, and operations executives completed an online survey that included questions designed to determine the following: • The degree to which RFID impacts corporate strategies, operations, financial re- sults, and company brand; • The effectiveness of existing RFID implementations; • Current and planned use of RFID; • The benefits, if any, that have been derived from RFID; • Major obstacles to implementing RFID; and • Planned RFID investment. Aberdeen supplemented this online survey effort with telephone interviews with select survey respondents, gathering additional information on RFID strategies, experiences, and results. The study aimed to identify what series of events and technology advances would cause RFID to gain momentum in its adoption and provide a framework by which readers could assess their own RFID programs. Responding enterprises included the following: • Job title/function: The research sample included respondents with the following job titles: procurement, supply chain, logistics executive or manager (24%); manufacturing/operations executive or manager (22%); IT manager (26%); CFO or other C-level officer (17%), marketing manager (8%) and finance/accounting manager (3%). • Industry: The research sample included respondents predominantly from manu- facturing industries. Consumer products represented 31% of the sample, fol- lowed closely by high-tech manufacturers (23%). Retailers and apparel manufac- tures totaled 17% of respondents. Pharmaceutical and healthcare totaled 11%. Other sectors responding included third-party logistics providers, telecommuni- cations, paper and lumber, and consumer durables. • Geography: Almost 60% of the respondents were from North America. Re- maining respondents were from Europe (19%), the Asia-Pacific region (15%) and Africa, the Middle East and Latin America (8%). All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 19
  28. 28. The RFID Benchmark Report • Company size: About 26% of respondents were from large enterprises (annual revenues above $1 billion); 47% were from mid-size enterprises (annual reve- nues between $50 million and $1 billion); and 27% were from small businesses ($50 million or less). Solution providers recognized as sponsors of this report were solicited after the fact and had no substantive influence on the direction of The RFID Benchmark Report. Their sponsorship has made it possible for AberdeenGroup, RFID Update and Modern Materi- als Handling to make these findings available to readers at no charge. All print and electronic rights are the property of AberdeenGroup © 2005. 20 • AberdeenGroup
  29. 29. The RFID Benchmark Report Appendix B: Related Aberdeen Research & Tools Related Aberdeen research that forms a companion or reference to this report include: • RFID-Enabled Logistics Asset Management: Improving Capital Utilization, In- creasing Availability, and Lowering Total Operational (June 2004) • RFID’s Biggest Non-Issue Now Resolved; Consortium Launched (September 2005) • Consumer Products Manufacturers Employ SOA to Differentiate Service Deliv- ery (November, 2005) Information on these and any other Aberdeen publications can be found at www.Aberdeen.com. All print and electronic rights are the property of AberdeenGroup © 2005. AberdeenGroup • 21
  30. 30. The RFID Benchmark Report About AberdeenGroup Our Mission To be the trusted advisor and business value research destination of choice for the Global Business Executive. Our Approach Aberdeen delivers unbiased, primary research that helps enterprises derive tangible busi- ness value from technology-enabled solutions. Through continuous benchmarking and analysis of value chain practices, Aberdeen offers a unique mix of research, tools, and services to help Global Business Executives accomplish the following: • IMPROVE the financial and competitive position of their business now • PRIORITIZE operational improvement areas to drive immediate, tangible value to their business • LEVERAGE information technology for tangible business value. Aberdeen also offers selected solution providers fact-based tools and services to em- power and equip them to accomplish the following: • CREATE DEMAND, by reaching the right level of executives in companies where their solutions can deliver differentiated results • ACCELERATE SALES, by accessing executive decision-makers who need a so- lution and arming the sales team with fact-based differentiation around business impact • EXPAND CUSTOMERS, by fortifying their value proposition with independent fact-based research and demonstrating installed base proof points Our History of Integrity Aberdeen was founded in 1988 to conduct fact-based, unbiased research that delivers tangible value to executives trying to advance their businesses with technology-enabled solutions. Aberdeen's integrity has always been and always will be beyond reproach. We provide independent research and analysis of the dynamics underlying specific technology- enabled business strategies, market trends, and technology solutions. While some reports or portions of reports may be underwritten by corporate sponsors, they do not influence Aberdeen's research findings. All print and electronic rights are the property of AberdeenGroup © 2005. 22 • AberdeenGroup
  31. 31. The RFID Benchmark Report AberdeenGroup, Inc. Founded in 1988, AberdeenGroup is the technology- 260 Franklin Street driven research destination of choice for the global Boston, Massachusetts business executive. AberdeenGroup has over 100,000 02110-3112 research members in over 36 countries around the world USA that both participate in and direct the most comprehen- sive technology-driven value chain research in the Telephone: 617 723 7890 market. Through its continued fact-based research, Fax: 617 723 7897 benchmarking, and actionable analysis, AberdeenGroup www.aberdeen.com offers global business and technology executives a unique mix of actionable research, KPIs, tools, © 2005 AberdeenGroup, Inc. and services. All rights reserved December 2005 The information contained in this publication has been obtained from sources Aberdeen believes to be reliable, but is not guaranteed by Aberdeen. Aberdeen publications reflect the analyst’s judgment at the time and are subject to change without notice. The trademarks and registered trademarks of the corporations mentioned in this publication are the property of their respective holders.
  32. 32. THIS DOCUMENT IS FOR ELECTRONIC DELIVERY ONLY The following acts are strictly prohibited: • Reproduction for Sale • Posting on a Web Site • Transmittal via the Internet Copyright © 2005 Aberdeen Group, Inc. Boston, Massachusetts Terms and Conditions Upon receipt of this electronic report, it is understood that the user will and must fully comply with the terms of purchase as stipulated in the Purchase Agreement signed by the user or by an authorized representative of the user’s organization. This publication is protected by United States copyright laws and international treaties. Unless otherwise noted in the Purchase Agreement, the entire contents of this publication are copyrighted by Aberdeen Group, Inc., and may not be reproduced, stored in another retrieval system, posted on a Web site, or transmitted in any form or by any means without prior written consent of the publisher. Unauthorized reproduction or distribution of this publication, or any portion of it, may result in severe civil and criminal penalties, and will be prosecuted to the maximum extent necessary to protect the rights of the publisher. The trademarks and registered trademarks of the corporations mentioned in this publication are the property of their respective holders. All information contained in this report is current as of publication date. Information contained in this publication has been obtained from sources Aberdeen believes to be reliable, but is not warranted by the publisher. Opinions reflect judgment at the time of publication and are subject to change without notice. Usage Tips Report viewing in this PDF format offers several benefits: • Table of Contents: A dynamic Table of Contents (TOC) helps you navigate through the report. Simply select "Show Bookmarks" from the "Windows" menu, or click on the bookmark icon (fourth icon from the left on the standard toolbar) to access this feature. The TOC is both expandable and collapsible; simply click on the plus sign to the left of the chapter titles listed in the TOC. This feature enables you to change your view of the TOC, depending on whether you would rather see an overview of the report or focus on any given chapter in greater depth. • Scroll Bar: Another online navigation feature can be accessed from the scroll bar to the right of your document window. By dragging the scroll bar, you can easily navigate through the entire document page by page. If you continue to press the mouse button while dragging the scroll bar, Acrobat Reader will list each page number as you scroll. This feature is helpful if you are searching for a specific page reference. • Text-Based Searching: The PDF format also offers online text-based searching capabilities. This can be a great asset if you are searching for references to a specific type of technology or any other elements within the report. • Reader Guide: To further explore the benefits of the PDF file format, please consult the Reader Guide available from the Help menu.

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