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|
|
Pulled
by the desire to reduce costs and increase information in the supply
chain and pushed by mandates from the likes of Wal-Mart and the
US army, radio-frequency identification tag usage looks set to
explode in the coming months. Unfortunately, there's a shortage
in some corners of critical thinking about what RFID is good for
and not so good for.
|
|
|
Among
the good ideas are the obvious supply-chain improvements that come
from being able to better track goods every time they pass a reader-enabled
checkpoint. Other uses outside the supply chain include tracing
objects through their life cycle. One application is baggage handling:
Airports and airlines are interested in using RFID tags to more
efficiently and accurately handle passengers' luggage.
|
|
|
However
the technology could be vulnerable to a number of scams that could
lead to considerable losses for retailers. One possible scam might
involve a consumer using a PDA (personal digital assistant) with
an RFID reader to scan a product's tag and then replace the item's
information with that of a less-expensive product. RFID could also
be used in such a way that violates consumers' privacy. RFID tags
could be affixed to products without customers' knowledge and that
the technology might be able to read the tags of other objects in
shopping bags, thus eradicating purchasing anonymity. Data protection
is going to be a huge issue as RFID becomes more commonplace.
|
|
| Is
RFID suited for my Company |
|
Rfid must be applied in a balanced way that takes into consideration a
company's strategic objectives, without being carried away by the
hype of RFID. Here are three key considerations that will determine
success. |
|
|
Consider
your key business indicators: Look at the overall business, the industry at large, existing technology
options and futures. In this case, enlisting outside expertise can
quickly assess where and how RFID can be a strategic enabler. RFID
offers significant potential benefits, but you must consider the
entire picture of your organization in order to see the greatest
benefit.
|
|
|
Consider
as-is and to-be business processes: RFID is not an IT issue. It is a company-wide opportunity. Business
processes will and should shift. Automation will and should occur.
People's responsibilities and knowledge must change. New methods
of analysis will be employed. New data may even shift the way that
companies measure success. Capitalizing on an RFID investment requires
championing a new vision, enabling a shift in thinking, and providing
simple changes to the way things are done today.
|
|
Ask,
What if?: What do you want
RFID to do for you? This question does two critical things. First,
it takes your company's mindset outside of the box. It creates a positive
and proactive mindset that allows your company to reap seriously big
benefits from technology. Second,
it generates demand to the manufacturers of RFID hardware and software
to make custom tags for your company. For example manufacturers
are now creating RFID tags with built-in time and temperature tracking
for food and medical applications. |
|
| RFID
Implementation |
|
|
Challenges
in RFID implementation include, costs, standardization, privacy,
performance, reliability and a need for greater collaboration. Systems
integration will be expensive too in most current systems.
|
|
|
Key implementation issues |
|
|
Cost
of Tags: The cost of tags has to be reduced to 5 cents
before RFID usage will become widespread. That is especially true
when it comes to low-priced consumer goods. The importance of tag
costs largely depends on the value of the item being tracked.
|
|
|
Tag Standards:
Currently there are several different standards for RFID
tags. Some suppliers are using "Class 0" tags, others
are using "Class 1" tags, and still others are holding
out for "Class 2" tags that are being standardized currently
by EPCGlobal. Standards are improving and changing so fast that
some of the today's implementations will have to be completely changed
in a year's time.
|
|
Tag
Placement: Suppliers are still working through the
challenges of figuring where on items (or cases or pallets) to place
tags. There are physical challenges (tag signals have trouble penetrating
liquid and metal). There is also tension between retailer mandates
which simply require case and/or pallet level tagging, and the supplier
benefits, which may be much greater through item level tagging. |
|
| Conclusion |
|
Optimally
implementing RFID is challenging and requires both creative vision
and careful execution. But nothing worthwhile is not challenging,
in life and in business. And, when properly approached, that small
little RFID tag on your can of tuna just might be a catalyst that
takes your company into a state of shareholder bliss. |
|
Next Issue:Supply Chain Risk Management
Previous Issue:Reducing
Chaos In Supply Chain |
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