Magazine Article | August 1, 2005

RFID's Rising Tide

Source: Field Technologies Magazine

Wal-Mart's RFID (radio frequency identification) initiative grabs all the headlines. But the smart label technology is already making it in many other markets.

Integrated Solutions, August 2005
Wal-Mart's decision to deploy RFID in its supply chain has driven a flurry of activity among suppliers, technology vendors, and the media. But, let's not miss the big picture. For every supplier facing an RFID mandate, there are scores of companies that are now investigating and deploying the smart label technology. Wal-Mart's RFID initiative may garner all the headlines, but that's because we're talking about the top company on the Fortune 500 list.

Wal-Mart, along with the DoD, Target, Best Buy, and others, will undoubtedly leverage RFID to reshape our concept of the supply chain. Step down from that rarified air, however, and you can see that this is already happening in smaller companies. It's also happening in vertical markets such as healthcare and homeland security. These stories may not grace the pages of magazines or newspapers, but they serve as examples for companies that want to deploy RFID and get a meaningful ROI. Wal-Mart brings attention to RFID, but end user education leads to varied deployments of the technology. The result is a case of a rising tide lifting all ships.

Do you want to see an RFID business case with real ROI? Look no further than asset tracking. Using 13.56 MHz tags and readers, companies know the location of all their important assets. If you're operating a Kanban system of manufacturing, RFID is an ideal technology to track RPCs (reusable plastic containers). You may want to track the comings and goings of expensive plastic pallets from your facility. Again, RFID is the answer. Hospitals are also using RFID for similar asset tracking applications. When wheelchairs and mobile medical equipment become tough to locate, for example, personnel begin hoarding these assets. Of course, this only leads to increased shortages and expensive last-minute rentals from supply houses. Using RFID, hospitals can pinpoint the location of these assets within the facility and also alert personnel if the assets leave the premises.

The broader discussion of RFID has raised awareness and deployments of active RFID tags. For homeland security applications, the active tags are used to track, trace, and eliminate tampering of cargo at ports and intermodal terminals. Smaller � but similar � active tags continue to be used in tracking livestock and other animals. In both cases, ROI is not necessarily measured in terms of dollars. And while RFID does streamline manual processes in these vertical markets, the real benefits come from greatly improved security.

In my years covering RFID technology and applications, my favorite quote still comes from Michelin's Dr. Pat King: "I wake up each morning hoping to find that RFID technology has gone away. Then I spend the rest of the day preparing for its inevitability." For companies facing mandates, this is a reasonable thought � prepare appropriately for RFID's pervasiveness. And, for companies not facing mandates, look at what your colleagues and competitors are doing with the technology. You might find out that RFID is more pervasive than you thought.