Businesses are always looking for ways to improve their cost structure. One way to reduce overhead is to streamline various operational processes. For continuous fine-tuning, accurate and effective measurement of process efficiency is crucial. RFID-enabled applications can offer the monitoring capability to vastly improve upon a wide range of processes. Because RFID technologies can electronically capture data during certain steps in a process, data about operational results becomes more readily available in real-time. This, in turn, facilitates a more insightful analysis and adjustment of operational processes. Here, we discuss some of the more common applications of RFID that can bring process efficiency gains to business operations.
Track and Trace
What is it?
Tracking and tracing objects is one of the most common applications of RFID to help improve process efficiency and reduce overhead costs. An outline of some of the more common applications is shown in the following sections.
Automated tracking devices for inventory control in factories and warehouses have the primary advantage of lowering costs by reducing the amount of manual work and operations. There are certainly other means of achieving automated tracking, besides RFID. The most common is barcode technology. However, there are several major advantages that RFID technology offers beyond barcodes:
Figure 1.6 depicts a simple packaged goods factory scenario where many tracking and tracing steps traditionally done through manual or barcode systems can be RFID enabled to gain more efficiency and visibility into factory and warehouse operations.
Figure 1.6. Packaged Goods Track and Trace Operations Using RFID
Luggage tracking with RFID technology can help achieve several time-saving objectives. RFID tags can be applied to luggage at passenger check-in time. This allows for a more efficient sorting and routing of luggage as it moves down the conveyor belt, which is outfitted with strategically placed RFID readers, which control the conveyor belt's automated routing mechanism. RFID tags minimize the requirement for manual operations, thereby improving speed and accuracy of routing. Because RFID tags do not require line-of-sight visibility to RFID readers, luggage does not have to be reoriented or handled in order to be read. After check-in, suspicious luggage can be tagged and routed to a secondary inspection spot. After inspection, the RFID tag on the luggage will ensure quick and efficient return of the luggage to its destination bin with minimal manual intervention.
Tracking of important documents, such as patient files at a hospital or client files at a law office or an insurance company, can increase the speed and accuracy of retrieval and reduce the risk of lost files due to inadvertent misfiling. The label used to tag a document carries a history log of authorized users and even a handling trail. This helps to create a more useful and secure workflow history.
Rental Item Processing
Long lines at libraries, video stores, and other rental stores are a deterrent to potential consumers. The use of RFID systems can greatly increase the speed of checkout and return. By reducing waiting, customer satisfaction improves, plus a smaller staff can easily administer a larger workload.
Any asset in a business or a home can be tracked and managed with RFID tags. The decision of whether to track an item using an RFID tag relates directly to its value, whether monetary or utilitarian. A diverse group of items that have been tagged and tracked includes the following:
The Smart Shelves application involves the capability to detect tagged items on shelves through a series of strategically placed readers and antennae on and around the shelves. The idea is to detect when an item is removed or added to a shelffor example, to enforce better inventory control or monitor sales. Smart Shelves are most commonly used to track high value items such as surgical instruments in hospitals. Wide use and deployment of Smart Shelves is directly dependent on the cost of implementation. In this case, the cost of the tag taken as a percentage of the item cost will play a large role in determining the application's viability. If the inventory is not valuable enough, as with packages of candy, the application may not be economically viable. The cost of installation of new and custom RFID-enabled shelving infrastructure can also play a significant role in determining viability. Today, several pilots are being considered to build Smart Shelves in retail stores for tracking ordinary items such as groceries or clothing. However, due to the aforementioned cost considerations, retail Smart Shelves are not expected to be widely deployed for several more years.
Why use it?
Using RFID to track objects in and of itself is beneficial because it enables greater process efficiency and reduces errors, overhead, and cost. However, the task of tagging and tracking an item in a supply chain is the first and most critical step in helping to create a more efficient integrated supply chain, discussed shortly.
What is it?
Use of RFID in industrial automation is commonplace. On the manufacturing floor, whether automotive equipment, disk drives, computers, or machinery, an item may be subject to hundreds of steps from the start of processing to finished product. RFID tags are used to help reduce the overhead and errors associated with moving through such stepwise progression. Because every step must be preceded by another specific and predetermined step, RFID tags are used to record the steps an item has gone through. At each new step, a reader queries the tag to ensure that the item has undergone all previously required steps before going through the current one. This is most helpful when a product goes through a process that forever changes its appearance, as in repainting. For example, when an automobile part gets to a new step on the assembly line, the process may call for a treatment that depends on an original color that is no longer visible. An embedded or strategically placed RFID tag, however, reports on what the original color was and allows the application of the correct treatment at this new step.
Why use it?
RFID technology on the factory floor or in an automated assembly line is a timesaving process that reduces manual labor and human error. It is often the only effective way to positively identify objects that are subjected to various treatments such as extreme heat, mechanical force, or color change that dramatically change their appearance.
Supply Chain Integration
What is it?
Supply chain integration is essentially the most extended application of tracking and tracing. It encompasses the tracking of literally anything in a supply chain, including raw materials from various suppliers, to manufacturing, and all the way to final delivery of a product to the end user. In the supply chain, there are numerous, seemingly unrelated, business entities involved in processes that get the item to the next link in the supply chain, closer to the end user. Capturing and integrating data about the location and history of an item in the supply chain can help create more efficient workflow and error-free processes. RFID technology is an ideal enabler to help track the movement of products through the links in the supply chain, inspect and analyze the data collected from RFID tags, act upon the data, and potentially add or associate more useful data to the tags that can be used at the next link in the chain.
The number of businesses that may touch a supply chain and the large number of processes that can be RFID enabled make the application and deployment of an end-to-end RFID-enabled supply chain solution potentially daunting. The Smart and Secure Tradelanes case study in Appendix A demonstrates this complexity. In this very large commercial supply chain initiative, there are 65 participants across three continents monitoring 818 shipping containers through 18 tradelanes. This multiphase project began in July 2002 and is expected to continue for several years before it is complete.
The catalysts that are driving RFID adoption into the supply chain are recent mandates from the United States Department of Defense (DoD), Wal-Mart, and other retailers, along with more favorable prices of RFID components, particularly tags. Although most of today's RFID-enabled supply chain solutions look at applying RFID between only two points (only one link) in the chain, fully integrating the links in the supply chain is recognized as the real value liberator. The more processes in the supply chain that can be integrated through RFID-collected data, the greater the potential for improvement in efficiency. This is the ultimate power of RFID. Sourcing and procurement, packaging, distribution, inventory control, forecasting, transportation, and logistics are all processes common to many supply chain operations. Linking these up to all the businesses and integrating all the processes in the supply chain is the challenge for the next decade.
A word of caution here is in order. Although RFID is a natural enabler for supply chain integration, several intermediate issues must be addressed before RFID can realize its full potential in the supply chain. These issues are introduced here briefly and discussed in more detail in Chapter 4, "Standards Related to RFID," and Chapter 5, "Framework for Deployment."
Why use it?
Supply chain integration is expected, by analysts, businesses, and vendors alike, to become one of the most widely used applications of RFID. Process efficiency resulting from improving visibility in the supply chain of anything from packaged goods to farm animals brings about cost savings to more than one business because there are potentially dozens of businesses involved in the handling of goods through a supply chain. Ultimately, these cost savings can be translated into benefits that positively affect the end user/consumer and as a result an entire industryfor example, retail as a whole.