Pros and Cons of Rfid Technology
I. Rfid Advantages
Pros and Cons of Rfid Technology
Radio Frequency Identification provides a significant assistance that is capable of revolutionizing the way clubs track products. There are many benefactors of this technology: the military, retailers, suppliers, consulting firms, producers of the technology, and consumers. Rfid provides clubs with a good alternative to bar-coding because no line-of-sight is needed to read a pallet, a carton, or a product with a Rfid tag. Rfid tags also comprise information on the product that is as a matter of fact readable and accessible for the reader. Rfid will also begin to automate company's furnish chain, reducing labor costs, human error and time spent checking in products.
In 2005, manufacturers and suppliers requesting new bids from the soldiery must be Rfid compliant on four distinct levels: packaged operational rations, clothing, tools, and weapon ideas repair parts and components. The soldiery requires that all cartons and pallets are shipped with a soldiery Shipping Label which displays shipping data. The group of Defense has created the Rfid soldiery yielding clarification as a way to help suppliers and manufacturers meet the military's new standards for Rfid. The program is run by Avery Dennison sell information Services, and they were commissioned by the Rfid soldiery yielding Solution. Avery Dennison sell information Services sells the Rfid tags to clubs which must be affixed close to the soldiery Shipping Labels to comply with group of Defense regulations.
The U.S. soldiery is salvage an big whole of money by using active and passive Rfid systems. By using Rfid for communication and communication systems in Iraq and Afghanistan, the soldiery is able to diagnose and fix problems much faster than before. The implementation of Rfid in just this area will save the soldiery close to half a million dollars this year. The U.S. Government has contracted Ibm to do study on the current Rfid being used currently in the soldiery and the potential hereafter applications for Rfid in the military. The soldiery has been victorious in creating good visibility throughout their furnish chain increasing their productivity and stability.
Retailers and other clubs that have a demanding furnish chain can gain an benefit on the field by using Rfid in the furnish chain. By demanding that all levels of their furnish chain be Rfid capable is a big investment. The productivity increase that follows the first speculation and implementation for clubs will pay for their investment. Wal-Mart was the first retailer to use Rfid in their distribution centers and warehouses, prompting many clubs to follow in their footsteps once Wal-Mart's success was realized.
Rfid is very victorious with sell clubs because it improves productivity, saves on human labor costs, and gives clubs real-time visibility with all their products. Rfid tags use an Electronic product Code (Epc) which is an upgrade and a exchange for the Universal product Code (Upc) system. "Epc has a 96-bit code that has digits to recognize the manufacturer, product category and the personel item. Manufacturers gather registration numbers & assign them to products. Each whole is unique to a given item."
The cost of a tag is everywhere in the middle of twenty-five to fifty cents. In the next five to ten years it could be reduced to five cents per tag. At some point in the near hereafter tags could fall to one cent tempting clubs to use Rfid tags on every product in a store. Wal-Mart says that since their shop now have Rfid, it makes it easier to keep store shelves stocked allowing employees to interact with customers.
Target was able to save on their speculation for implementing Rfid, following in Wal-Mart's footsteps as Wal-Mart had already paved the way and suffered the pitfalls of implementing a new technology. In increasing to the lower implementation costs, many of Target's suppliers had already begun preparing for the switch over to Rfid assuming Target would follow Wal-Mart. Target as a large retailer knows how foremost it is to be able to furnish real-time data on pallets, cartons and shipments up and down-stream through their furnish chain.
A break-through in Rfid technology was made by Intermec, Inc. In May of 2006, with new rugged and reusable Rfid tags. These tags can be written thousands of times; it can handle hazardous chemical exposure, and withstands temperatures from -50 degrees Fahrenheit to 250 degrees Fahrenheit. In October of 2006, Intermec released a new version of the rugged, reusable Rfid tag, together with wide-band antenna that can be used on any surface in any part of the world.
Rfid makes the enterprise world seem like a smaller place, even clubs like Wal-Mart who are very big and have a large integrated furnish chain. Rfid enables clubs to be more efficient with their time and space. clubs that concentrate some newer furnish chain technologies with Rfid could see great results. Combining auto-picking with Rfid would cut man-power needed, time needed to move pallets and cartons around a warehouse, and time needed to send pallets to their permissible destination. The goal of a company's furnish chain should be to cut time needed to be productive, by automating as much of the furnish chain as possible. It reduces human error, and machines are capable of running twenty-four hours a day and cost less than human labor. The
application of Rfid for a large enterprise like Wal-Mart or Target, as well as smaller sell shop can ensure a good shopping touch with more in-stock items and a more knowledgeable store.
The Rfid market is booming and many technological clubs have gotten in the game producing Rfid parts and systems. In many cases being a producer of Rfid components and systems also allows you to come to be a consulting firm for the technology. Hewlett Packard (Hp) is one of the largest clubs developing Rfid systems. Hp's goal is to make it as easy and affordable as potential for a enterprise adopting Rfid technology. Hp has touch in the Rfid field, as they were one of the early adopters of the technology and have been very victorious integrating it into their business. Hp began with two larger clients, Hasbro (produces children's toys) and Conros (a large Wal-Mart supplier). Hewlett Packard has created two Rfid Centers for Excellence, one in California and one in Taiwan, to demonstrate new potential uses for the technology, as well as how it can be implemented into a business. More centers are slated to be opened throughout the world, together with Great Britain, Singapore, and Tokyo Rfid Centers for Excellence.
The Rfid market sits at almost one billion dollars in 2006 and has varying estimates as to the increase potential of the market. Estimates of Rfid market size in 2008 vary everywhere from .3 billion by Idc, to .2 Billion by the Yankee Group. As shown in shape 1 in the appendix, most of the commerce is made up of sales of hardware, tags, readers and other bodily products of Rfid. almost 20-25% of the market is made up of consulting work for the technology and the last 5% is made up of software for Rfid. The two biggest areas firms are concentrating on are the yield and consulting sides of Rfid.
The biggest challenges for producers and consultants alike are the reliability and durableness of Rfid systems and products. It is hard to simulate the wear and tear a product will touch over time. Hp has made testing Rfid products one of their benchmarks, providing intense field-testing of Rfid to ensure its durableness and quality. A competitor of Hp is Ibm, who agreeing to Amr study is the market leader in Rfid. Ibm has over eleven years touch working with Rfid, and like Hp, they were an early adopter of Rfid technology. The benefit that Ibm has over Hp is there world-renowned consulting services, coupled with their gigantic networking capabilities. Ibm's services promise more results than Hp's Rfid systems generally because of Ibm's consulting expertise. Ibm works with clubs to uncover the best avenues to implement Rfid, attempting to maximize Return on speculation (Roi) by reducing one person per shift from manually tracking products allowing them to focus on value-added manufacturing activities. Ibm also focuses on other ways to heighten Roi including, contribution a one-time savings of 0,000 in operating costs, continuous fabrication line operations, good customer assistance providing real-time information on products, and less errors and delays cause by human error.
Rfid began to take off once clubs like Wal-Mart and Target, and the U.S. soldiery demanded that their top 100 suppliers must adopt Rfid technology. Many suppliers were not ready for a move like this, a move that would completely retrofit their current operations at a high cost to the supplier. There were some suppliers that welcomed the change in technology and already began implementing Rfid in hope of Wal-Mart and the U.S. Military's examine that their suppliers adopt the new technology. Wal-Mart demanded that their top one hundred suppliers would need to be Rfid ready by January 2005, and to Wal-Mart's surprise, twenty three extra suppliers have volunteered to make the change to Rfid. There is a new generation of tags that hit the market in 2005, called the Gen 2 Standard, which make Rfid more challenging to suppliers who have no Rfid systems in place. The Gen 2 Rfid improves on the first generation of Rfid by increasing read times, increasing read ranges, and read tags more accurately.
Suppliers and manufacturers will consideration the benefits of implementing Rfid into their organizations streamlining parts of their operations. Return on speculation is the most foremost factor for a enterprise implementing Rfid. Suppliers will see their Roi increase as human labor hours are decreased, human errors are decreased and interoperability is increased. Rfid increases the visibility of the suppliers so they can do their job in real time, assuring that the correct holder is sent to the correct location. It also saves money in the long-term for manufacturers and suppliers because Rfid will save time spent inventorying and tracking products. An benefit for suppliers and manufacturers using Rfid is customization of products in a shorter period of time. Smaller suppliers and manufacturers will have a harder time implementing Rfid, as costs range from 0,000 to million to implement the technology, but as costs go down more clubs will adopt Rfid.
Rfid does have another potential benefit for suppliers that could give them invaluable information. For Wal-Mart suppliers, readers are set up at the back door so suppliers know when their shipments have arrived increasing visibility for both entities. A second reader is placed at the entry to the sales floor so the supplier can see what is on-hand on the sales floor and in the stock room. This will allow the supplier to see which products sell good than others so that they can be replaced, and it also allows the supplier to originate more correct sales forecasts. A secondary benefit of Rfid is that the promotions that merchandisers spend a lot of money to set up are often left in the stock room for too long or are improperly placed. Now merchandisers and vendors can make sure their promotions are being handled correctly. Suppliers and manufacturers have the potential to save money on yield costs, while manufacture money on customized products.
Consumers should be the extreme winner with Rfid being implemented throughout a company's furnish chain. In the long-run, shop will save money throughout their furnish chain, thus bringing down costs to consumers. Consumers should also expect to find more helpful and more informative customers assistance with clubs that have Rfid. These clubs now have real-time data to share with the customer. A buyer complaint about sell shop has all the time been that there are too many out-of-stock items; however, with Rfid in place many of these shop should see a significant decrease in out-of-stock items. Having Rfid tags on inescapable products can also make people's lives much easier, such as a microwave that is a reader and recognizes the tag of the food you put in and will automatically cook it agreeing to the directions on the tag. It also helps environmentally because clubs will use resources more efficiently, benefiting everyone. Once Rfid tags are able to be used on food products it will make a recall on a inescapable item much easier and it could potentially save lives.
Consumers use Rfid everyday and many do not comprehend the benefits they are receiving from the technology. Contactless cost is a developing technology, the card being used contains a tag and the cost area contains a reader. Mobil and Exxon use a "Speedpass" as their contactless form of cost allowing customers to wave the card in front of a reader to pay for gas or whatever in the suitable store. Visa and Mastercard are the two biggest developers of this technology, claiming that it will benefit everyone from consumers to businesses. It allows population to have preset money on a card (either debit or credit) which decreases waiting time at check-out stands and increases loyalty to clubs that offer this feature. another use of smart cards is keyless entries, which is becoming a beloved trend in America, using just a card and swipe it over the sensor to allow entry. Rfid is a beneficial technology for consumers salvage time and contribution conveniences customary bar codes, prestige cards and keys cannot offer.
Rfid contains many advantages over customary ways of coding pallets, boxes and products. It allows for non-line of sight reading of the tag which shop all the product information. Rfid reduces human labor costs and human errors through the furnish chain salvage clubs money, as well as reducing theft in the store and warehouses. Rfid can save lives as well if there is a recall and the recalled food item or product is tagged, then it would be easier to gather all the units.
Ii. Disadvantages
Radio Frequency Identification has been around for over fifty years, but it has been the rapid amelioration and deployment of the technology over the last five years that has raised people's awareness and insight of the technology. While there are many potential benefits for Rfid, there are many pitfalls as well. Every level that could benefit from Rfid can also reap negative rewards from the technology.
The U.S. soldiery was one of the early adopters of the technology using it for over ten years in a minuscule area of their operations. In 2003 they upgraded their usage of the technology by demanding that all suppliers must affix a Rfid tag to every pallet, carton and big-ticket item being shipped to the military. The biggest qoute the soldiery faces is an issue of security. With faultless product information on a tag it is easy for an enemy of the United States to pull information off a tag. This could follow in loss of life of U.S. Soldiers or even U.S. Civilians if the wrong product ended up in the wrong hands. The tags could apprise enemies of potential weaknesses and strengths of our soldiery and give them a view on how to attack us at our weakest points.
Large clubs like Wal-Mart and Target who use Rfid face many potential problems with the technology. Rfid has no proven infrastructure manufacture it difficult for suppliers to keep up with these company's demands to come to be Rfid-ready. If the suppliers cannot effectively implement Rfid into their business, then retailers cannot fully view their furnish chain. If retailers cannot get all their information in real time over their whole furnish chain, then the issues they are trying to solve will remain problems. Out-of-stock items, first-in-first-out products and last-in-last out products will still cause problems for these large retailers.
Epcglobal is a start to an international standards body for Rfid. It has yet to be beloved by the International society for Standardization (Iso) and there is still not a global frequency standard. While 900 Mhz appears to be the best frequency due to its long read-range capability, 13.56 Mhz is still used delaying the standardization of global frequency for Rfid. High costs of Rfid implementation is the reckon many mid-size and smaller retailers have not adopted the technology. The short-term outlook for clubs who use Rfid isn't impressive, although long-term benefits will be realized.
Privacy issues are the whole one pitfall for Rfid and retailers. As long as the tags are only affixed to pallets and cartons then the retailers would not have any specific information on the consumer. However, when Rfid tag prices fall, clubs like Wal-Mart and Target plan on using Rfid tags on personel products which they can trace consumer's buying habits and other information consumer's wish to keep private. It was privacy issues that force Benetton to cease their pilot Rfid system. They wanted to embed a tag in articles of clothing to stop theft, conclude buyer buying habits and keep their inventory at an thorough level. Privacy advocate groups such as the Consumers Against Supermarket Privacy Invasion (Caspian) fight clubs using Rfid to track buyer behavior. A study showed that up to 78% of America was against Rfid based solely on privacy issues. It will be difficult for clubs in the hereafter to tag personel items without a communal outcry without some form of safety for the public's privacy rights.
Consumers have the largest disadvantage of any other entities involved with Rfid technology. There are five privacy issues that consumers must try to protect themselves from: private placement of tags, unique identifiers for objects worldwide, gigantic data aggregation, private readers, and personel tracking and profiling. private placement of tags by clubs is an easy way to get information from consumers. The buyer will feel safe buying a product with no knowledge of an Rfid tag embedded in their clothing. These tags theoretically could track a person around the world if there were readers in specific locations throughout the world. Personal information may also be embedded in these tags giving information as detailed as your curative history. Prada and Swatch use embedded tags in their clothing, and Benetton did as well, but a boycott of Benetton was victorious and they removed their tags. There is no law against clubs embedding tags, and only California and Utah have made official requests to change the situation.
Companies who use Rfid can compile gigantic amounts of data on consumers, together with product likes or dislikes, buying power or even prescription history. Rfid makes it easy to amass this data and to prescription correlations. If a corporation owns many shop they can concentrate data in the middle of clubs and generate new data on buying habits.
Hidden readers violate people's privacy much the same way private tags do. Gillette and Accenture are introducing "silent commerce" which embeds tags on people's products and readers in strategic locations without the consumer's knowledge. These clubs have experimented with distinct reader locations fluctuating from private carpeting locations to shelve locations and even private in floor tiles. Readers could even be installed in doorways on street lights, everywhere that population have to pass through, and instantly all information embedded in the tag is broadcast to the reader. If this were to happen privacy would be impossible because you would never know if the products you have comprise tags, and you never know when you are within presence to a reader.
The disadvantages of Rfid hinge generally on privacy concerns, technological imperfections, cost of the technology and no proven way to set up an Rfid ideas for a company. The government and corporations are the two groups that offer the most concern for privacy issues. private tags and readers threaten to take away human mystery, contribution a world where population see, feel and hear only what the government and large corporation want population to.
Iii. hereafter of Rfid
The hereafter of Rfid is uncertain, however, the technology is here to stay. clubs have many obstacles to overcome to make the technology a feasible selection to be implemented. Privacy issues and will persist, although cost for Rfid systems will decrease. In order for Rfid to be successful, clubs must work with privacy advocate groups to originate a fair way to implement Rfid without alienating their customers.
Technology will continue to originate for Rfid and many new applications will be realized. Automation will be a side-effect of Rfid development, in the furnish chain and in everyday activities. Contactless cost methods are already available, as well as automated keycards to open doors. Rfid tags installed in cars with readers on the roads and freeways will alert the authority if you are breaking the law. Supermarkets will finally be able to comprehend their shopping cart checkout ideas once prices fall to a more affordable price. Fresh foods, metals and liquids will all be Rfid compatible in the near future. If privacy issues are not watched closely, population will come to be tagged and there will all the time be person watching and analyzing every person's decisions.
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