Glamorising RFID

Ten years ago, people were predicting that by now the dreaded supermarket checkout queue would be obsolete. Instead, we'd simply wheel our loaded and RFID-tagged trolleys past a reader, which would automatically present us with a reliable total.

Clearly, that hasn't happened - and the image of RFID technology as a whole has suffered as a result of what was probably a well-meaning attempt to glamorise an essentially unsexy technology.

Because, make no mistake about it, RFID is not sexy. It is not new, or social, or anything 2.0. It does not 'reside in the cloud'.

And yet this workhorse technology is making slow but steady gains that will ultimately have at least as much impact on ordinary businesses and consumers as newer, slicker technologies.

Some definitions are in order before we get down to the details of where implementing RFID technology does (and doesn't) make sense. Any RFID system consists, at minimum, of tags containing a microchip holding information, some kind of scanner or reader to receive the information and a database in which to store it all. But things get a lot more complicated than that, starting with the difference between 'passive' and 'active' tags.

Passive RFID tags - which probably account for the majority of those in circulation - are unpowered. They rely on the magnetic field generated by the reader for the power they need to transmit information when necessary. This makes them very low-cost, but also means they can't be read at any great distance.

Active RFID tags carry their own batteries, considerably extending their range - and their cost. A third category of 'semi-passive' tags carry batteries strong enough to power their own circuits, but still need an additional power input from the reader to transmit information. Newer tags might also include motion or temperature sensors, making for a bewildering variety.

This diversity goes some way towards explaining the relatively slow take-up of RFID in SA, says Motorola country manager Mark Kelly.

“RFID tags are relatively expensive - they can range in price from about 10 US cents to around $100. Even at their cheapest, there's no way it makes economic sense to tag every item in a supermarket trolley.”

Even if the tags cost only a fraction of a cent, says Kelly, there is another problem. “Bar code scanning is already being used in 98% of all supermarkets. It's efficient and cheap. Changing the entire system to RFID, including changing all the scanners, would be enormously costly. There's just no economic reason to do it.”

However, Kelly notes: “RFID definitely has its place. It's a superb way to track and monitor high-value items like computer equipment, and it's also very widely used in the transport and logistics industry for pallet and container tracking.”

Owen Behr, KwaZulu-Natal branch director, Proscan Enterprise Mobility, adds that RFID is an ideal complement to bar code scanning, not a substitute for it.

“An organisation that has already implemented bar coding has all the right disciplines and processes in place, and can build on those to implement RFID. RFID on its own is not a miracle cure for anything - it's not going to solve anybody's business or people problems. You first need the right business rules and processes in place.”

“There were lots of unrealistic expectations about what RFID could do and that got the technology into trouble,” agrees Nick McKenzie, technical director at nVisionIT. “At its simplest, RFID is just a data acquisition technology, but you need to choose your tags and their application very carefully. Tagging a human or a metal item is difficult, for example, because both the water in human bodies and metal interfere with signal transmission. Applications like pallet tracking are ideal because pallets are stacked consistently so you can get symmetrical arrangement of the tags and much better read rates.”

Anybody wanting to implement RFID in their warehouse or distribution centre, says McKenzie, should ask some critical questions: “What is the physical structure of your warehouse - can you control how tagged objects enter and exit? For example, if your wash bay is near your receiving bay, we can get errant reads from pallets sitting in the wash bay, and they end up tagged as being in the wrong place. The answers to these questions will determine things like how many readers you have, where you place them, what kinds of tags you choose and whether you apply them at the item or the pallet level.”

McKenzie and Proscan's Behr agree the major opportunities for RFID in SA's near future lie in the logistics and supply chain industry.

“If you're supplying re-usable pallets that get moved all over the country by your clients, an RFID system really makes sense,” says Behr. “The same goes for third-party logistics suppliers - those are the people for whom there is a real cost benefit to having a real-time view of consignments. If you're a manufacturer or a retailer, it makes less sense at the moment, until costs come down even more - but everyone can benefit from having better real-time information all the way along the supply chain.”

RFID can make it much easier to track the entire lifecycle of a pallet, for example, from its first commissioning into the system to its retirement, adds McKenzie.

“We can start using trend information to investigate things like pallet usage, wear and tear and repair cycles,” he says. “If there's a lot of damage coming from one site, it might be a sign that a forklift operator needs more training. If you're just a small warehouse with one forklift, it probably doesn't make sense, but if you're a national or multinational company with hundreds of customers and millions of pallets, the business case builds very quickly.”

Sticking an RFID tag on a laptop is not going to stop somebody misusing it.

Owen Behr, KZN branch director, ProScan Enterprise Mobility

Elsewhere in the world, RFID is already making inroads in other areas. “Everybody thought the supply chain would be the big thing, but we're seeing greater success elsewhere,” says Motorola's Kelly. “Baggage handling, for instance. Some of the world's largest airports are now 100% RFID. There are also some specialised vehicle management, asset control and logistics installations for the military, where the cost doesn't matter so much if it's a mission-critical application.”

Even the clothing industry is beginning to use RFID at the item level, says Kelly. “American Apparel, for example, is a big RFID user. It's tagging every item that comes off the production line. The tags cost a dollar or two, but it more than halves stock-take time and the benefit continues through to its retail stores.”

“The most successful RFID applications are in closed-loop systems, where the thing you're tracking never leaves the organisation,” adds Kelly's colleague Andrea Sada. “Open-loop systems need to solve the cost problem first.”

Whichever kind of RFID system you implement, getting the associated business processes right first is non-negotiable: “If you don't do it right, it's the start of your problems,” says Kelly.

One of the problems is the huge amount of data generated by RFID systems, especially once individual items are tagged. “We have scanning databases running into terabytes,” says McKenzie. “You have to know what you're going to do with all that information, and have systems that can handle it. But it's a very powerful technology, and if you've done your homework the benefits are definitely there.”