Ensuring a Successful RFID Implementation

Throughout the manufacturing and logistics industries, Radio Frequency Identification (RFID) technologies have improved asset tracking, streamlined the supply chain and increased operational efficiency.

Improved performance, falling prices, and maturing standards continue to move RFID into the mainstream and have made it practical for an increasingly wide range of organisations.

What is RFID and how does it work?

RFID is an identification technology that uses wireless readers to access data encoded in chips. The chip is mounted to an antenna, which receives radio frequency (RF) signals from the read/write device. The basic form of a chip attached to an antenna is called a transponder or tag.

RFID tags are rewritable. Data can be added or updated throughout the life of the tag, which makes the technology suitable for creating a pedigree to associate with an object throughout its useful lifecycle. Tags can also be reused by erasing them and encoding new data.

As a radio technology, RFID requires no line of sight between the reader and the tag to exchange data. RFID tags therefore can be read through packaging, including cardboard containers and plastic wrap used to seal pallets, and tagged objects can be read regardless of their orientation through the use of optimised RFID systems.

RFID readers can also automatically recognise and differentiate all the RF tags in their reading field, providing additional flexibility for material handling, packaging, and sorting operations because there is no need to maintain spacing between objects to ensure they will be read.

Business benefits of RFID for different industries

Businesses must think of RFID as enabling technology that co-exists with other auto-ID technologies to enhance and improve business processes for benefit. Many companies may first get involved with RFID as part of compliance tagging. Compliance programs and high-profile projects get most of the attention, but the real driver for the explosive growth in RFID use is business value. Here are some examples:

1. Shipping and Receiving

One of the powerful drivers behind compliance tagging programs is the clear benefits to shipping and receiving processes that are enabled by RFID-tagged shipments. For shipping and receiving, a reader positioned at a dock-door can instantly identify pallets of tagged goods that pass through. Shippers can use the data to verify that all the products required for the shipment have been packed and loaded. The process helps eliminate costly shipping errors and the manual labor associated with order checking.

The receiving organisation uses the dock-door read to verify that the shipment matches the order or manifest, and to automatically record the items into inventory. Because RFID readers can identify hundreds of items per second, portal readers are especially useful for cross-dock applications, where incoming goods must be quickly identified, sorted, and redirected.

2. Inventory Management

RFID-enabled processes help inventory management in three primary ways:

Accurate data collection eliminates identification errors that may lead to out-of-stocks and excess inventory
Fast reading and real-time report eliminate data latency that can lead to inaccurate forecasts and inefficient storage, handling, and replenishment
Unattended monitoring, thus reducing physical counts for inventory counting and auditing

3. Production Tracking

Similar to material handling, RFID can be used to track and route assemblies through production processes. RFID tags can withstand exposure to heat, moisture, solvents, abrasives and other conditions that impair barcode performance in industrial environments, so the technology provides a way to gain new visibility into manufacturing operations.

4. Warehousing

RFID’s unattended, orientation-independent reading capabilities can be highly valuable for warehouse processes. Reading zones can be created to automatically monitor certain areas of the facility—such as shelf locations, secure storage areas, or even a container yard—and automatically record all movements.

By integrating the RFID systems with enterprise networks and applications, alerts can be automatically communicated to managers or security personnel. The system can also be integrated into warehouse management system (WMS), asset management and other software applications.

Imagine picking operations where workers scan shelves and bins with an RFID reader to automatically detect the storage location of the sought items. Readers would also automatically detect items stored in the wrong location and alert operators to the problem. Using RFID for these applications enables items to “self-report” their locations, rather than requiring workers to find them, this reduces the cost of “human error”, thus lowering costs.

5. Asset Management

RFID is highly advantageous for asset management applications because tags can provide a durable, permanent identifier, with extra memory that can be updated repeatedly with configuration settings, inspection records, service information, and other dynamic information.

RFID asset tagging also facilitates efficient audits and inventories because assets can be detected and recorded at a distance, without requiring a worker to manually read and record information from the asset tag.

6. Check-in/Checkout

Many large libraries, buildings and car parks around the world have implemented RFID to speed material check-in and checkout, regulate shelf inventory and deploy security applications. Low-cost, flexible smart labels are inserted in books and can be made invisible to patrons.

Counter personnel check dozens of books in or out in mere seconds without manually handling and orienting each item. The tags can also be used for theft detection, much like anti-shoplifting technology currently used by retailers. Librarians using portable computers with RFID readers can take inventory and find misfiled materials simply by walking down an aisle of bookshelves. The reader can automatically detect missing materials and alert the operator.

Video rental stores use RFID for similar applications. RFID readers are positioned at the checkout, return bins and doorways to record transactions and detect shoplifted items automatically.

These library and video store operations are essentially in-store inventory management applications that can be adapted for use in many other industries, allowing business operations to save thousands of dollars in terms of clerical costs.

7. Access Control and Personal Security

Personal identification is a longtime and very widespread application for RFID. Tags embedded in employee ID cards provide hands-free access to secured buildings and a tamper-proof form of identification that ensures only authorized personnel are admitted. Similar systems are used to identify hospital patients and patrons at theme parks, where the ID card or RFID wristband is also used as part of a cashless payment system.

Launching RFID in business operations

One of the most important issues to consider is where and how to begin. Determining how best to harness RFID’s capabilities is one of the first challenges project managers face. Examining the questions and guidelines that follow will help build a strong foundation for your RFID efforts.

1. Determine the business benefits

Companies who already have some form of auto-ID technology in places - such as bar codes - for business processes can reap strong benefits by selectively using RFID to enhance operations. For example, making only a small, incremental improvement to shipping accuracy can produce strong benefits, as the following calculation illustrates: Various analyses have established that shipping errors cost between US$60 and US$250 to resolve, depending on labor rates, shipping expenses, and the amount of clerical and administrative time required. Therefore, each 1% improvement in shipment accuracy should reduce shipping expenses between US$60 and US$250 per every 100 shipments. For a company that ships 100 orders a day, each one percent improvement in shipment accuracy would produce annual savings of US$15,600 to US$65,000.

2. Identify the specific business issue that is to be solved or enhanced

RFID-enabled processes can overcome environmental, quality control and throughput limitations that restrict alternative identification methods. RFID should be used where it meets a specific need or solves a problem. For ideas on how RFID could improve your business, review operations to determine if there are any consistent choke points or processes that require excessive human handling, such as placing items a certain side up on a conveyor. These processes are candidates to be automated with RFID, which can provide a good return on investment by reducing labor requirements and improving efficiency.

3. Determine what information is required

Look at your business processes and limitations, and determine if things could be improved if more information was available, or if current information was available more quickly. The durability, memory, and remote reading capability of RFID tags make it practical to access information in environments where alternative technologies can’t perform. In particular, the memory on RFID tags makes it possible to include information to support efficient business processes.

4. Identify needed performance characteristics

Once data content, collection points, and communications goals have been determined it will be easier to define the performance the RFID system must provide. Application requirements drive decisions on RFID frequency, tag types, encoding method, reading equipment, and supporting software.

5. Test and Experiment

Pilot projects and pre-deployment testing should uncover any interference, quality, or performance problems that need to be resolved before the system is deployed. RF interference is the main concern—usually produced by other wireless or RF technologies at work in the environment. Interference can be avoided by using different styles and sizes of RFID antennas and tags, and experimenting with different frequencies, power output levels, and tag mounting options, all within the scope defined by the application requirements. Testing may not reveal every hurdle, but thorough planning can mitigate them.

6. Determine Which Standards and Regulatory Considerations Apply

There are many RFID technical standards, industry standards, and compliance guidelines, plus various national regulations for RF transmission.

The ISO 15693 standard is prevalent for high-frequency (13.56 MHz) RFID technology. Companies who base systems on ISO 15693-standard technology benefit from a competitive vendor market that provides a choice of interoperable products. Personal identification applications such as access control and automated time and attendance recording, frequently use ISO 15693-compatible tags and equipment.

There are many applications ranging from compliance mandates to closed-loop applications that can improve supply chain processes. The RFID project manager should also determine what other business value can be derived from leveraging RFID to meet a compliance mandate. In addition, the RFID implementation project team should possess the following characteristics to ensure a successful RFID deployment in the organisation:

Clear understanding of RFID technology and project objectives
Do not view RFID as a panacea to repair broken processes
Understand that technology is complementary to other auto-ID solutions
Engaged in live testing to determine choke points, poor read zones and limitations of RFID

The Future of RFID Implementation for businesses in Asia

As manufacturing outsourcing continues to grow in Asia, it is even more critical for organisations to have a clear view of their own supply chain to ensure smooth transitions and avoid interruptions that may delay the delivery of products to the customers.

Projects that focus on identifying the location of parts, components and products at any given time within the internal supply chain, will yield the greatest returns. The ability to quickly adapt and re-direct production lines to meet changing customer requirements will enhance the Asian manufacturing processes.

The future of RFID lies not in compliance mandates but in applications that allow businesses and organisations to derive internal benefits from its implementation.

Closed loop applications are focused on specific objectives defined by the organisation to achieve specific problems. They are easier to implement since integration is limited to the specific application and does not need to comply with external vendor and customer systems.

The most promising uses of RFID include package validation, item level tagging for apparel and IT asset management. Infrastructure requirements for implementation are less complex for these types of applications. Piloting of these applications will continue throughout 2009 with implementations beginning late this year into 2010.

Successful RFID deployments are possible through careful initiation and thorough research by a team. The team should preferably be cross-functional in nature with an identified RFID Project Manager. RFID deployment is not a panacea but a highly useful technology to improve visibility into an organization’s business processes and supply chains.

Top Tips

Steps to ensure a successful RFID implementation

Determine what is the specific business issue to be solved or enhanced
Identify what information is required (is more information needed or the current information needed more quickly)
Identify the system’s needed performance characteristics
Test, Test, and Test – interference, quality or performance concerns should be identified in this phase. The recommendation is to engage a known and experienced RFID Solution Provider to provide guidance and consultation
Identify the RFID regulatory standards that apply to the business objective
Understand regulatory guidelines for area of operation. Although UHF operates within the frequency range of 860MHz to 958MHz, many countries have more restrictive ranges
Determine the ROI from limited pilots

Andrew Tay is the Asia Pacific region President of Zebra Technologies, the largest manufacturer of thermal label printers worldwide. Andrew’s responsibilities include channel sales management and directing sales strategies across fourteen markets including Australia, New Zealand, China and the Indian sub-continent.

Since taking on this position in 2007, Andrew has provided Zebra Technologies with new sales insight and direction to embrace emerging technologies such as RFID and integrated application solutions. With 10 years of experience in the data capture and identification labelling industry, Andrew has a unique insight and knowledge of the current industry needs and implications for the development of future technologies.