As RFID begins its roll out, it is vital that companies avoid paralysis by analysis and commit to implementation says Zebra Technologies director, RFID market development Chris Hook
There is an old saying in show business that many superstar entertainers spend 20 years trying to become an overnight sensation. Today, it appears the same can be said about Radio Frequency Identification.
RFID technology has been around for quite some time but, despite its potential to improve processes and supply chain practices, broad industry adoption has been limited. Competing and conflicting technologies have flooded the market-place.
Proprietary solutions have prevented open supply chain applications and RFID’s role in the supply chain has not been clearly defined.
All of that appears ready to change. Over the last three years, groundbreaking RFID and systems research has been conducted by some of the world’s leading academic institutions, with comprehensive and sustained support from a range of end-user and technology sponsors.
Interest from the global business community continues to grow. There is consensus on RFID applications.
Initial RFID pilots and implementations have been launched. Hardware and software developers are committed to this effort.
At long last the key elements are converging but these factors alone cannot entirely drive global implementation. Open, global standards must be at the centre of this effort and are the proven catalyst to success.
As we envision the future role RFID will play in the supply chain, we must look to the past for important history lessons.
The ubiquitous fax machine is an excellent example of the steps that industry must take in order to move a technology from idea to implementation on a global scale.
The facsimile machine experienced explosive growth in the early 80s, going from just 300 000 machines in use in the US to over 1.5M in just a few years.
Surprisingly, this technology has been around since just after the turn of the century, with only limited business and government usage until the 70s. The main obstacle to mass acceptance was the lack of technical compatibility between different fax machines.
Economies of scale
In the mid-60s users, regulators, and fax machine manufacturers came together in the first efforts to standardise fax equipment and communications. These standards effectively enabled a market through standardisation. Economies of scale came into play, allowing vendors’ fax machines to reach a critical mass of users. Today, fax machines are an essential part of the everyday business system.
The same can be said about the ubiquitous Universal Product Code. Bar code technology has been around for decades but proprietary systems and lack of common standards inhibited broad adoption. When industry committed to standardisation in the 70s, implementation barriers were removed.
Today, the bar code has become truly ubiquitous and, with comprehensive standards to ensure interoperability, compatibility and lack of ambiguity of coding, it is the foundation of a global system of commerce.
Whether it’s a fax machine, the UPC or the future of RFID in the supply chain, the success of these innovations is directly linked to the availability of open, technology-neutral standards.
No matter how promising a technology looks on paper or in the research laboratory, standards are the driving force that will facilitate broad implementation. It is also instructive to examine RFID deployment history and note the profound impact that international standards have had on triggering substantial deployments.
In the world of payment systems, particularly the use of contactless smart cards as a means of paying for train and bus fares, the creation of an international standard for the RF protocol used by readers and tags led to the availability of interoperable products.
These systems are now in use by transit authorities in many of the world’s largest cities.
The availability of standards-compliant products gave the decision-makers the confidence to press ahead with deployment, confident that they had multiple sources of supply.
Collaborative commerce
While this illustrates the value of standards, it is of course true that RFID in mass transit serves [typically] one customer – the transit authority. RFID for supply chain applications requires a comprehensive suite of standards for products and systems that will allow otherwise commercially unrelated trading partners to derive benefits from improvements in their supply chain operations. This is the essence of collaborative commerce.
RFID is well positioned to improve and transform the supply chain but widespread global adoption will neither happen overnight nor in isolation.
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“Today, the bar code has become truly ubiquitous and, with comprehensive standards to ensure interoperability, compatibility and lack of ambiguity of coding, it is the foundation of a global system of commerce.” |
Key market factors
RFID’s future will be determined, in part, by the following key market factors:
The needs of business must drive technology, not the other way around. Too often, technology has been thrown out into the marketplace in the hope of finding an application.
This creates unnecessary costs, complexities, and inefficiencies. Innovators with differing technical approaches compete rather than co-operate. Business needs should always guide the development of technical solutions and standards.
In order for RFID to be successful on a global scale, users must be active in the standards process to ensure that it solves real business challenges.
Open, global standards are essential. Proprietary standards, systems, and solutions usually fall short of their potential because the proprietor is usually the main beneficiary, not the community of users. RFID standards must reflect the collective voice of real-world users.
The Uniform Code Council and EAN International have been working with users to develop open, consensus-based standards that will enable the timely adoption of RFID in the supply chain.
As neutral facilitators, the UCC and EAN have provided a forum where global users, technology providers, academia, and regulatory agencies can come together in pursuit of global, standards-based RFID solutions. This will ensure the availability of standards-compliant solutions, which will accelerate the adoption of RFID in the supply chain.
The business culture of change. RFID represents some unique challenges to organisations because it is a new and, in a sense, abstract technology.
The user can see both bar codes and the scanning devices used to read them.
RFID is somewhat more intangible because it is a means of capturing information using remote sensors [readers and antennas] and invisible radio frequency signals. RFID implementation will require changes to systems and processes, and organisations must have a top-to-bottom culture that accepts and embraces change.
As with many new innovations, companies often find it tempting to wait but, in the course of minimising risk, they miss significant opportunities. RFID advocacy cannot be limited to a few people in the company.
Everyone in the organisation must understand the business and technical issues behind the question ‘Why are we doing this?’
RFID will play an increasing role in the global supply chain. Companies must be ready to act.
Leadership
Early adopters cannot be the minority. Since this effort will require the momentum of a critical mass of users, strong and active leadership from the user community will be essential.
Studies have consistently shown that companies who implement early are the ones that gain maximum benefits.
As RFID begins its roll out, it is vital that companies avoid paralysis by analysis and commit to implementation.
They must also work collaboratively with their trading partners to gain their commitment to implement.
Real implementation will enable system issues to be identified and corrected, provide collective benefits for users, and define needs for new research to refine and enhance the technology.
Although it is hard to appreciate RFID technology with just the naked eye, its potential in the global supply chain is clear to see. Standards will bring RFID technology into focus and provide the direction and clarity needed to facilitate broad, multi-industry implementation for all around the world.