Radio Frequency IDentification (RFID) is an automatic identification method, relying on storing and remotely retrieving data using devices called RFID tags or transponders. An RFID tag is a small object that can be attached to or incorporated into a product, animal, or person. RFID tags contain antennas to enable them to receive and respond to radio-frequency queries from an RFID transceiver. Passive tags require no internal power source, whereas active tags require a power source.

This document attempts to explain RFID, which is one of a basket of AutoID technologies,in a business perspective and explores answers to the following questions:

• where can these technologies be used and
• why should industry use them ?

1.0  Quick Introduction to AutoID & RFID:

The term “AutoID”, (short for “Automatic Identification”), is a method to :

• automatically identify/sense a product, person, animal, document, parcel or any object relevant in business / industry and

• get data about that object into a computer system, ideally at the point where a transaction occurs.

Examples are barcodes on groceries, magnetic strips on credit cards, employee access cards, handheld computers used in field services & communicating with enterprise computers, RFID tags on pallets, machinery, cars & other movable assets.

RFID (Radio Frequency Identification), which is one of the above, offers a quantum leap in capabilities, usage possibilities and benefits, hitherto not possible thru other AutoID options.

2.0  How is RFID Fundamentally Different ?

• Traditional barcodes were “read only” wherein the product code is used as a key to a database that resides on a computer, from where rest of the information is retrieved.

RFID can be “read-write” which means that the database information can be stored on the product, if required, enabling data to travel with the product, with the possibility of it being read and updated along the way (a portable dynamic database !)

• Other technologies are essentially “close contact and line of sight” (using lasers or swipes) wherein they need to be first human “reachable” and readable, before being read automatically.

RFID does not have that limitation allowing us to automate the reading of data from distances and without human intervention.

• Barcodes or magnetic strips are essentially used for identifying “one product at a time”.

RFID being largely automated, offers the possibility of identifying multiple products at the same time and give us the ability to uniquely identify each unit, if required.

• At the moment, deployment of RFID is more feasible at pallet, carton or container level, because of the relatively higher entry costs per tag/transponder and also because traditional applications were designed for handling one transaction at a time. These equations are changing fast and RFID adoption is expected to boom in the months and years to come.

3.0 Components:

A typical RFID scenario consists of:

• Tags or transponders, on a product, animal, pallet, carton, car etc.
• Readers or Interrogators, on a dock doorway, shelf, carried by operator, forklift-mounted etc.
• Antennas, mounted on tags & readers for efficient communication between the two.
• Middleware (to allow these to talk to enterprise applications & exchange data)
• Enterprise application software functionality

4.0 Current State of RFID Adoption in Industry:

• There is an understanding and appreciation of the potential of RFID amongst the CEO/CIO/CFO community.
• Price points (per tag) are relatively high inhibiting their ubiquitous use at item-level, as yet.
• Standards are under formation with EPCGlobal taking the lead.
• Inter-operability (between US & Europe, for example) still to be resolved due to differences in allowable radio frequency bandwidth.
• Leaders in every industry vertical are engaged in pilot projects and proof-of-concepts across the world.
• Commercial adoption is expected to boom 2006 onwards in several industry verticals.

5.0 Applications & related benefits across industry verticals:

5.1 Retail and the Supply Chain:

• Major challenge is to “have the right goods available at the right places in the right quantities”.

• Incorporating RFID into the supply chain can reduce the amount of labor required to monitor goods movement & inventory flow, because RFID enables “volume reading” as opposed to “one by one”. You can get dramatically higher supply chain visibility because RFID-enabling allows you to update the information that moves along with individual products.

• Where barcode-based systems already exist, RFID can be introduced to complement them, while gathering additional information thru the supply chain. Enable RFID for pallets, totes & containers and build a record of their contents by scanning barcodes on individual products, retailers can have full visibility into inventory levels & locations. Becomes easier to fill orders and fulfill rush orders, without incurring undue managerial or labor time.

• As goods move from dock to truck to stores, RFID-enabled processes can act like a “security guard”, conducting automatic inventories and comparing goods with manifests.

• Cross-docking can be expedited by instantly reading all the cases & cartons included within a specific pallet, enabling needed items to be identified, located & pulled for a waiting shipment. Incoming shipments could be automatically queried for specific containers and if present, they could be located and separated.

• Networks of RFID readers can be setup across retail storage locations and warehouses to automatically locate pallets, without using manual labor.

• RFID tags can be interfaced with sensors & linked to processes, to reduce shrinkage and spoilage. Pallet tags can be programmed to accept readings from temperature sensors and transmit an alert if storage temperatures are touching limits.

• Fresh produce is packed into Recyclable Plastic Containers (RPCs) for travel thru distribution to the store’s produce department and are directly lifted onto the shelf for instant display and when empty, are sent for cleaning & re-use. RFID-enabling RPCs and building the process functionality within the ERP can give visibility about its location in a store, cleaning history, temperature of washing, chemicals used etc. At the growers, by adding RFID readers, you can track produce to a specific retailer or the retailer can ensure that the first produce is the first to go to shelves.

• Using RFID-enabled processes to automatically capture lot & batch numbers, especially in food products, provides high traceability, which could be useful in a Recall situation.

• Pallets or cases with RFID tags could be read as they are assembled into a complete customer order or shipment & this data passed along to processes within an ERP. Individual readings could also be used to trigger a shipping manifest, which could be printed or could also be encoded into another RFID tag. Shipping label information could also be encoded into RFID tag to facilitate automated handling.

• Manifest information encoded in an RFID tag could be read by the receiving organization to simplify the receiving process, for e.g. advance shipping notices (ASN). Physical inventories will be done in a fraction of the time, and can be more frequent.

• Automated checkout can become viable too, as prices of RFID labels continue to drop.

• “Which customer got which bottle of which drug on which date” is a classical requirement and RFID can help in answering this question.

• The Drug industry has started to use RFID in its fight against thieves and counterfeiters, by embedding RFID tags in bottles of theft-prone drugs, during the manufacturing process.

• At the moment, wholesalers can buy drugs that have been smuggled into the country and send them on to pharmacies . With RFID tags embedded, pharmacists will be able to tell if indeed the drug came from the manufacturer. Law enforcement can also check if the bottles recovered have been previously reported stolen.

6.0  Concerns:

• Environmental, emission, health & safety concerns (more research & data is awaited before an adverse conclusion can be made !)
• Privacy and “big brother is watching” issues (should RFID tags be disabled after purchase to ensure privacy and what is the potential loss of benefits ??)
• Relatively high costs of tags/transponders (prices will continue to fall as volume adoption grows !)

7.0  Conclusion:

By its very nature, RFID offers “unmanned” & automated operations at great speeds. `offer consulting companies huge opportunities in business process re-engineering, new ERP functionality development & deployment and application integration & collaboration at multiple levels.

Tags & readers are just devices which are a means to an end and there will always be new developments & improvements in hardware.

Also, there will always be software/hardware tools available in the market for making these RFID hardware devices communicate with application software and need not be a high-concern area. The software industry is adopting open environments and therefore, connectivity, communication, co-existence, inter-operability can be taken for granted, as we move forward in planning for AutoID-enabled applications.

Most crucial areas to focus on are :

• business processes that are candidates for improvement,
• how and why RFID can address them and
• the required ERP functionality to handle the sheer volumes of data, the level of detail that is now possible and the speed at which data is likely to be captured into the ERP.

9.0 Sources & Resources:

Intermec Technologies

Symbol Technologies

RFID Journal

www.usingrfid.com

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