Over the last few years, there has been much change in the radio frequency identification (RFID) market, as vendors and consumers have overcome major technological issues. An explosion of RFID technology has been born from the stabilizing unsure connections and limited range reads. Middleware complexity has been drastically absorbed into ERP systems, automation software, the cloud and external business process outsourcing (BPO) software, and the reduction of label prices has helped make RFID systems relevant again.
Ten years ago, when the Wal-Mart RFID initiative mandated that all suppliers have RFID capabilities for inventory tracking, the time was not right. The technology was still very difficult to implement; vendors' lack of expertise, tedious heavy systems integration and difficulty in generating enough labels for RFID-enabled inventory were all major hurdles. Now, many of those issues have diminished and the market has finally caught up with where RFID technology should be. RFID has been around for more than 65 years now; it should not only be stable and fully understood, but the technology should be stable enough to support the advantages gained by using these types of systems.
One overarching theme in RFID system implementation has always been where would the technology can fit in and how it can provide return on investment (ROI). In previous years, organizations often did not understand where RFID would factor into its processes and how to best use and manage the data generated.
Cloud reducing complexity of RFID systems
The advent of the cloud has greatly simplified the complexity of what middleware used to be, how it reacts with data and how organizations manage the workflows and administer RFID systems. Many of the first-generation RFID systems monitored the hardware and the actual RFID tags through two separate systems, which complicated processes and defeated the purpose of some of the automation RFID was designed to provide.
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The cloud has provided an avenue for organizations to benefit from using RFID technology without the complexity of setting up an entirely new infrastructure to accommodate the RFID system. The cloud also acts as the conduit to facilitate data exchange and extract, transform and load (ETL) operations by providing bi-directional data flows to interface with multiple systems.
Cloud computing is just one way to access the benefits of RFID. Another area where middleware has been simplified is the rise of BPO software. These systems exist in the cloud and allow automation and configuration of external workflows, triggers and alerts. When workflow is automated outside of traditional ERP or legacy systems, integration woes are often negated, due to the flexibility provided. The systems can be configured as virtual machines to monitor both hardware and manage software requirements of data exchanges.
The data generated from RFID capture is often misinterpreted and not properly used. Inventory data such as product descriptions, SKU numbers, quantities, point of origin and sales orders can all be ascertained from RFID, if encoded. When the information is captured, the stream can then be fed into the third-party software for further processing, or it may be sent to another system for decoding and updating inventory levels.
Moving the RFID market forward
Organizations today have many more options than previous first-generation RFID adopters. The technology has become stable, thereby reducing false reads and allowing for proper updating of systems. Most importantly, organizations are starting to see the ROI of RFID systems due to the falling prices of the RFID tags themselves. Price was previously one of the most prohibitive cost factors blocking RFID adoption. Newer technologies, such as the STAR RFID readers and hardware, have made strides in extending the read range for proximity scanning, which can simplify receiving and shipment tasks by allowing full automation. These newer systems are also less prone to interference -- another obstacle that had to be overcome from first-gen RFID.
Retailers and trading partners alike are now savvier with their own technology, which had led to a wide range of options and configurations to facilitate cloud-based RFID systems. The cloud has also provided an easy avenue for organizations to build test environments and development areas using RFID technology, while reducing its risk and offsetting costs, because a physical environment does not need to be built.
True automation can occur when using RFID technology correctly. When trading partners and suppliers mandate usage, the panic need not be internalized, now that there are new options. Many logistics and distribution providers have turned to third-party RFID outsourcing to handle all aspects of the RFID installations on their behalves for a rental fee or a monthly subscription fee, similar to a Software as a Service (SaaS) model. Hardware standards, middleware facilitation through the cloud, lower tag prices and easier set-up have made RFID relevant and feasible once again.
About the author:
Dylan Persaud is managing director at Eval-Source. His 20 years of IT experience includes 14 years at the enterprise level. Past positions include business systems analyst, implementation lead, project/product manager, enterprise architect, configuration specialist, market analyst and a manager of research, which have allowed him to examine organizations from the ground up and given him a high-level overview of the enterprise software market. While working for companies such as IBM, IDC, Indigo and TEC, he focused on how businesses can run more efficiently.
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Why isn't RFID being used by more companies for inventory tracking?