Has it all gone wrong for RFID?

RFID was the technology that would turn the supply chain on its head. Forget paper systems, scrap messy error-prone barcodes – you would just need to wave an RFID reader at the warehouse to get a full and accurate reading of everything in there.

The trouble is, of course, it hasn’t happened like that, prompting the question: what went wrong for RFID?

Terran Churcher, chairman of Codegate points out that RFID remains the most talked about, but least adopted, of all auto-ID technologies.

Was it all just hype? “It is quite evident to me that way too much hype was made around RFID,” says Clive Fearn, marketing director at The Barcode Warehouse. “A lot of people spent a lot of money on the hype and it cost a lot of manufacturing companies millions of pounds in research and development.”

But Pierre Bonnefoy, director of global RFID solutions at Psion Teklogix, argues: “We should ask what went wrong with RFID in the supply chain sector? In fact, the RFID approach in the supply chain was wrong, because of very dogmatic statements.

“Just remember the Wal-Mart mandate. The logistics domain is used to working with 100 per cent proven systems. Proposing a non-mature technology was a big cultural jump, even if some ROI can be obtained with non proven technology. It is more or less the failure of marketing, having over communicated the benefits, and forgotten the culture of people working in warehouses and the diversity of the logistics processes. How could it have been successful, proposing a unique way of capturing the data?”

The approach was far too dogmatic and monolithic, he argues. “The automotive industry took the right approach to RFID, supply chain did not. The automotive industry has been using RFID for more than 15 years, firstly for cycling pallet control and now for vehicle tracking along the assembly chain.”

Arguably, what we have seen is typical of the path taken by emerging technologies. Kurt Mensch, RFID principal product manager at Intermec, says: “RFID is gaining acceptance and growth within specific, focused applications because value-added resellers have built value-based solutions around the technology. Customers are no longer on their own to try to integrate a new technology and now have the components for a full system available to them, built around specific process improvements, including hardware, software, and integration tools.”

So is now the moment to go back and look again at the technology? Well, opinions are split. Mark Dale-Lace, director of Mobexx, believes that organisations should look at RFID with an open mind. “RFID and barcodes are in simple terms a means of positive identification. There will be applications where RFID is the best choice – high value items, items not in line of site, high-speed identification, and so on. And, there will always be applications where barcode is the number one choice.”

And Martin Port, managing director of Masternaut Three X, says: “Many organisations are beginning to see the value of RFID. Ringway Jacobs, for example, is using RFID as part of its wireless vehicle and asset management solution. This combines real-time, live online tracking of vehicles and RFID tagging of portable equipment with PDA-based service management software. This helps to manage the logistics for its emergency response teams.”

But are companies ready to make large-scale investments in the technology? Bonnefoy points out that it is quite difficult taking the investment decision of installing 20 dock doors in a warehouse when you are not sure of the benefits. “Starting to integrate a few mobile readers, to your existing process, and within your existing team, is a more reasonable and easy decision, a realistic path toward RFID adoption. Then, when the RFID tags and mobile readers are in place, fixed readers can be used in combination, to optimise the data capture. Just take the example of the automotive industry and what they did with RFID: a pragmatic approach, using the benefits of the technology step by step, only where it can work and bring real value.”

Matthieu Delporte managing director of Baracoda highlights the fact that there is now an understanding of what RFID can not achieve. “More and more businesses are interested in solutions with richer information, or solutions using the reading/writing capabilities of RFID systems. Many businesses are also combining barcodes and RFID, with barcodes on the products and the boxes, but RFID tags on the pallets which can be used several times for transport. Another example in a warehouse, where picking is controlled by an RFID system and operators are preparing orders by scanning barcoded products placed in tagged basket.

“The mobile workforces, technicians, sales guys etc, are also more and more using mobile AIDC applications running on PDAs or smartphones. These types of applications are quite recent, unlike traditional applications for warehouses, and are not really mature yet. But companies understand the potential of these new applications and especially the new RFID ones as such kind of workers are more likely to use richer information.”

But while RFID still collects all the headlines, barcodes should not be written off. Fearn says: “Still today it is evident that the barcode can and is being used to drive a significantly higher return on investment for the vast majority of businesses. If you just take the logistics sector, we are working with companies replacing pen and paper systems with data capture solutions based around the barcode in the warehouse and now for the first time also getting rid of paperwork in the drivers’ hands and giving them mobile computers for electronic proof of delivery, again based around the barcode.”

Ultimately, of course, it is return on investment that will be the ultimate decider when it comes to choosing whether to use barcodes or RFID. Terran Churcher points out that a barcode can be printed on a label or on a product for almost zero cost, but a passive RFID tag will cost at least five pence in volume. “A barcode reader can be purchased for as little as £45 but an RFID reader will be at least £400. However, barcodes require line of sight reading, you need to be able to see the bars to scan them, whereas RFID can be read by scanning within the range of the reader. The application may require information to be written to the tag at various stages of its progress through the process, which would preclude the use of barcodes.”

Terran Churcher highlights the fact that mobile phone and smartphone manufacturers are starting to include Near Field Communications hardware into their models. This high frequency, short range (four inches) wireless communications technology which allows two devices to talk to each other. It uses an extension of the proximity card, ISO/IEC 14443, which is used by Barclaycard.

A barcode reader can be purchased for as little as £45 but an RFID reader will be at least £400. However, barcodes require line of sight reading, you need to be able to see the bars to scan them, whereas RFID can be read by scanning  within the range of the reader.

Terran Churcher”What will make this technology far more widely used than normal RFID is the volume of product already installed. NFC is in use as contactless payment and public transport ticketing systems. By enabling potentially millions of mobile and smartphones to interact, assuming the mobile applications are written, will open the NFC floodgates. This consumer-led    wave of adoption will undoubtedly spread to the commercial market giving huge cost benefits associated with this volume of use.”

“Developments made by a smartphone manufacturer soon appear in rugged hand-held computers, for example: GPS chip sets, touch screens or accelerometers. NFC will be the biggest development to affect the auto-ID sector over the next five years.”

Port agrees: “The development of augmented reality and mobile apps for smartphones such as the Apple iPhone will no doubt drive further uptake of auto-ID. It will mean that more
businesses will be able to take advantage of combined vehicle tracking and RFID solutions.

Mark Dale-Lace also points to the development of web-based applications and the ability to transmit a wireless signal to and from the RFID tag. “This will open up new possibilities for the technology,” he says. “And RF tags with embedded location technologies can open interesting opportunities.”