The ongoing development of Radio Frequency Identification (RFID) opens up new possibilities to parallelize information and material flows. Manufacturing processes can be provided with real time information and new lifecycle services (e.g. definition of optimal cutting parameters, life cycle data, etc.) can be realized. In this paper the advantages of RFID on metal cutting tools are discussed. RFID on tools can support an efficient tool management and help to automate manual activities within the manufacturing process.