The Chronicler's Web (TCW)

by DAN CALLOWAY
Published 17 February 2010 @ 21:09 UTC

WEAVERVILLE, NC – In 2003, Wal-Mart introduced RFID smart tagging technology to the supply chain industry by announcing that it wanted its top 100 suppliers to start incorporating the RFID smart tag microchips into cases and pallets of material that it shipped to Wal-Mart. Niemeyer, A., Pak, M., and Ramaswamy, S. (2003) reported that Wal-Mart asked these suppliers to begin using the RFID barcoding technology by 2005. However, what makes it noteworthy is that Wal-Mart’s suppliers wanted to do more than simply what Wal-Mart asked them to do; instead, they wanted to investigate using RFID smart tagging technology into their own products to potentially reduce their own supply chain costs. Another noteworthy mention here is that RFID smart tagging is better than traditional barcoding in that the smart tag not only allows shippers and receivers of goods to identify the products they ship, they also allow the industry to track these products during transit, determine when and where the products were manufactured, what components they consist of, and when they might perish (Niemeyer, A. et al., 2003). And, finally, RFID technology has been available for several years and has been used in such devices as tolling systems and security badges, but what makes this a new innovation of RFID technology is that due to the plummeting costs of the RFID microchips, this same technology is now affordable for use by organizations such as Wal-Mart and other suppliers/shippers of goods to incorporate into their products to reduce overall shipping costs. For example, in 2000, the cost of a RFID smart tag was around $1, whereas in 2003, the cost had dropped significantly to around $0.25 to $0.40 (Niemeyer, A. et al., 2003). Niemeyer, et al. (2003) cautions organizations that they should not become fixated on the reducing costs of tags as a reason for jumping on the “RFID smart tagging” bandwagon prematurely until they have assessed the overall cost of upgrading their Enterprise Resource Planning software to accommodate the implementation of RFID technology into their organizations, which could run into the tens and hundreds of millions of dollars in investment for large companies.

RFID smart tagging technology is different from traditional barcoding technology in that to read barcode labels with barcode readers, the barcodes must be in line-of-sight of the readers themselves and the information contained in the barcode is limited to electronic price code (EPC) information; not true with RFID microchips embedded in smart tags, which can be detected and read within a certain range of the chips, but don’t require line-of-sight because they are passive tracking devices that use radio frequency signals detectable several yards away from the scanner and the chips contain far more information regarding the product, its location, and its status. This radio-frequency transmission is similar to bluetooth wireless transmission today in that the signals are wirelessly transmitted by antennae embedded in the microchip to the RFID microchip reader (Niemeyer, A. et al., 2003).

RFID smart tagging has enormous implications for supply chain management. However, this same technology has equally important implications for other industries, such as the automobile industry, the medical field, pharmaceutical industry, appliance and clothing manufacturing, GPS tracking, home manufacturing, and utility metering just to name a few (Calloway, D., 2009).

A business case can be made for the use of RFID smart tagging in each of the industries mentioned previously because the use of these smart tags can allow individuals as well as organizations to track usage data and analyze this data to a far greater extent than ever before. The use of smart tags have found their way into such devices or things as toasters, clothing (that automatically adjusts the synthetic makeup of the apparel depending on the ambient temperature that is detected by the tag), electrical and water meters (to automatically report the readings to a central computer, eliminating the need for a meter reader but also collecting digital data for later synthesis and analysis), automobiles (for GPS tracking purposes), home manufacturing (to allow the home owner to track such things as electrical usage, internal temperature, lighting, etc.), mobile phones, drivers’ licenses, and passports. Embedding RFID smart tags in devices allow them to take on electronic identities that can be queried remotely or equipped with sensors to detect physical changes surrounding them. Eventually, through the advances in nanotechnology, particles as small as dust might be equipped with RFID smart tags and networked. Smart tagging allows us to transform static objects into dynamic objects capable of sensing the presence of other smart tagged devices surrounding them and allowing them to communicate with one another in a salient or even ambient fashion. More recent innovations in the use of RFID smart tag technology has found its way into the leisure and sports arenas with the smart tagging of skis for lift passes. But the most revolutionary and controversial use of RFID smart tagging that is under development and has already been implemented in some instances is in the tracking of animals (so owners can find lost pets) and in children’s’ clothing (so parents can locate a missing child). RFID smart tags are even finding their way into human beings through implants for medical reasons (so physicians can monitor a patient’s condition), and the concept of requiring newborns to have RFID smart tags implanted under the skin for identification purposes during their lifetime is being investigated. However, privacy, security, and personal rights are in question with the uncontrolled use of such technology, and it will require the investigation into the ethical, legal and governmental ramifications before smart tagging of humans becomes a reality. (Calloway, D., 2009).

Calloway, D. (2009, October 12). Are You Ready For “The Internet of Things?” | The Chronicler’s Web. Are You Ready For The “Internet of Things?”. Retrieved January 31, 2010, from http://dancalloway.com/wordpress/2009/10/are-you-ready-for-the-internet-of-things/

Niemeyer, A., Pak, M., & Ramaswamy, S. (2003). Smart tags for your supply chain. McKinsey Quarterly, 2003(4), 6-9. Retrieved from http://web.ebscohost.com.library.capella.edu/ehost/detail?vid=1&hid=111&sid=d824aef8-4f43-4994-9797-84c4d454be3c%40sessionmgr114&bdata=JnNpdGU9ZWhvc3QtbGl2ZSZzY29wZT1zaXRl#db=bth&AN=11143695#db=bth&AN=11143695#db=bth&AN=11143695#db=bth&AN=11143695#db=bth&AN=11143695#db=bth&AN=11143695#db=bth&AN=11143695#db=bth&AN=11143695