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RFID Read Reliability Is Not an Issue

RFID is far more accurate than existing systems, yet some people continue to insist they can't adopt the technology until it is 100 percent reliable.
By Mark Roberti
I don't mean to disparage the bar code. It's an extremely useful and important auto-identification tool. But it frustrates me when people suggest they can't use RFID because it can't read every tag on every item or case. RFID technology is very reliable, but it has to be used appropriately.

No manufacturer would try to read every bar code on a pallet going through a dock door. But many people insist RFID has to be used that way. In fact, manufacturers can collect the information they need to improve their operations by reading tags on cases—hands-free—when those cases are being stacked on the pallet.

The issue is not whether RFID is perfect. The issue is whether you can use an RFID system to capture data that can be utilized to create more value than the system costs. In apparel retail, a single handheld interrogator, coupled with fixed readers at the receiving area, the replenishment area and the door between the back room and retail floor, can boost inventory accuracy from 60 percent to better than 90 percent. Some people don't want to even consider the return on investment (ROI) that would deliver, because they are fixated on the fact that RFID might miss two or three of the 10,000 items in the store. And people think I'm nuts?

The only time RFID needs to be 100 percent reliable is when a financial transaction is involved. In most cases, it is. Visa and MasterCard trust the technology enough to use it in credit cards, and the technology has also been employed in Mobile Speedpass cards for years.

Will you be able to walk through a checkout portal without stopping, like in an IBM commercial of a few years ago, and have all of the tags read? I don't know. Given the wide variety of items you could purchase at a mass-merchandise store, and the possibility that one metal item might shield a tag on another item, it might never be 100 percent accurate. Even here, it's not clear that bar codes are 100 percent reliable, or that RFID needs to be. If using RFID at the point of sale increases revenue by $1 million, would you really worry that it missed $10,000 worth of items?

For companies to evaluate whether RFID will benefit their operations, they need to focus on the ROI it can deliver. RFID Journal is developing an ROI calculator for retail apparel, which will be given away at our upcoming RFID in Fashion event, to be held on Aug. 11-12, 2009. And we plan to create calculators for health-care providers and other industries as well. Our hope is that these will help companies estimate the potential ROI and run pilots focused on capturing information that can be used to assess the actual ROI, instead of spending all of their time testing whether RFID can read every tag, every time.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog or click here.

USER COMMENTS

Bill BOWMAR 2009-07-22 01:50:22 AM
RFID Read Accuracy Mark, Too many of your examples are based on logistics issues mainly in the retail and distribution sectors, and in general are not very innovative. Can we have examples and discussions where the technology is used for innovative solutions. In a "previous life" I worked in the emergency services where we needed to confirm what equipment was on an emergency vehicle when it went out to attend an incident, and then what was on it on its return. One RFID solution might be to "double tag" everything and then use software to eliminate the duplicates. I am also aware of attempts to embed RFID tags into helicopter blades and railway sleepers to estimate the usage they received. Similar examples are welcome but please can we have less on logistics which seems to have been "done to death". Regards, Bill Bowmar
Peter Thayer 2009-07-22 10:35:17 AM
RFID Implementor While I second Bill Bowmar's comment, I also think Mark misses the main point of RFID. We're not implementing RFID to replace the barcode. We are implementing RFID to improve on the barcode. Consider, for example, a License Plate Number (LPN) that aggregates a collection of items on a pallet. Bar code readers handle the task of scanning individual items for association to the LPN, and tracking the movement of the LPN through the supply chain. But, a typical 1 or 2% "operator" mis-association of items to LPN causes major expense in a supply chain. A 100% read-reliable RFID forklift or portal could verify or obviate the need for LPN-item association. With imperfect tag read performance, the RFID industry remains focused on the fractional ROI of stock/clerk reduction. A RFID industry that delivers the consistent ability to track all assets through the supply chain would deliver a much higher ROI (likely an order of magnitude higher) through higher stock turns, fewer stock outs, fewer missed or wrong shipments, less material handling, etc.
Mark Roberti 2009-07-23 08:36:35 AM
Read accuracy Bill, Thanks for your comments. I was addressing a common misperception in RFID in an application that many, many people are looking at. Logistics issues might have been done to death, but there are still a lot of people with a lot of misunderstandings about RFID. I could point to a lot of innovative objects that have been successfully tagged, but that would not help dispel the myth I was addressing. As for the idea that I am missing the main point of RFID, nothing could be further from the truth. Of course, it would be ideal if RFID could be read on every product, in every environment, every time. It would also be ideal if bar codes could be read without line of site. Neither is possible. Does that mean we should dismiss RFID as useless? I don't think so. You can do an LP association with RFID with less labor and more accuracy than you can do it with bar codes. Plus, you can capture a lot more data with no incremental or very low incremental labor costs. More data will allow companies to increase stock turns, reduce out of stocks, reduce shrinkage and so much more. Not seizing the benefits in the belief that you can't get them without reading every tag on cases stacked on a pallet is a huge mistake.

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