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Get Ready for Reality Online

RFID provides the foundation for a new way of doing business in which every product and asset has a digital counterpart.
By Bob Violino
Sep 01, 2003—Many business executives are wondering about all the buzz surrounding radio frequency identification. What makes a radio-powered microchip with a serial number so important? The answer, says Glover Ferguson, chief scientist at Accenture, a consulting and technology services company, can be summed up in one word: information.

Ferguson envisions a world in the not-too-distant future when every product and asset—from jet engine parts to important documents—will have RFID tags that will enable these inanimate objects to communicate information about themselves to computers. Accenture calls this "silent commerce." But Ferguson sees this as only the first stage in a trend toward what he calls "reality online."

Once individual objects can be identified, companies can add temperature, motion, radiation and other sensors, as well as miniature microphones or video cameras. Then, not only will these objects be able to identify themselves to computers, they'll be able to provide information about their status and condition. That data can be stored online to create a digital representation of the physical world—a virtual double of the real world.

"We spend a lot of time trying to get data: 'What's the inventory level, what's our backlog, where is the shipment?' When we finally get this information it's from the past," says Ferguson. "What if all that information was online? What if you knew at any given moment exactly what your inventory was and where the shipment was? Now, we're putting reality itself online."

Combining RFID tags and other sensing devices with Web services and wireless communications will deliver a spectacular array of information. Objects will be able to tell us about themselves. Shelves will be able to send wireless instant messages to store clerks when they need to be replenished. Bearings on industrial machines will alert maintenance that they will soon need to be replaced. Sensors in food packaging will warn retailers that meat has been contaminated. These scenarios may sound futuristic, but reality is already moving online.

A Services Platform
"We've got all these technologies becoming available and the bandwidth to get at all this information," Ferguson says. "Now everything we build can be a platform through which services can be delivered."

RFID is a key element of reality online because it provides both a means of identifying the object and transmitting information to computer systems. As tag and reader prices come down, RFID will proliferate because companies need ways to gather accurate real-time information.

Ferguson cites numerous RFID applications already delivering strong returns on investment. FedEx couriers can unlock doors and start their vehicle using a wristband instead of keys. Millions of consumers purchase more gasoline and convenience snacks because they can do so with the swipe of a key fob. And millions of farmers deliver the right food and medicine to individual livestock.

The potential applications for RFID-sensors is almost unlimited. A Swiss railroad has been using a combination sensor and RFID device that lies underneath trains, measuring the temperature of car axles as they go by using an infrared sensor.

"Hot axles imply worn bearings, which can eventually lead to derailed trains," Ferguson says. "RFID can tell you exactly which car needs to come off and that it has to come off now. That increases the operational effectiveness and safety of the transport system."

Vitally needed standards for presenting and exchanging data are being developed today and are close to adoption. "You can see the beginnings of a common language that different companies providing gadgets will use to express this data," Ferguson explains. "That makes it much more usable than if you have 37 different proprietary interfaces to plug in to to get any value out of the data."

Silent commerce and reality online will be aided by many parallel developments. A key element is the Auto-ID Center, a partnership of global companies and research universities to create standards and an infrastructure to enable computers to identify any object anywhere in the world instantly.

Active Objects
This and other efforts "have moved up the timeframe by at least five or six years," Ferguson says. "We're going from a world where everything just lays around like an inert object to where the objects are actually participating in the economy and helping us."

He warns that companies should not wait to implement RFID and that businesspeople should not consider it as simply a bar code replacement. If you do that, "you are missing the revolution," he warns. RFID, silent commerce and—in the not too far out future—reality online can do so much more than simple bar codes that organizations need to consider restructuring the way they do work to take advantage of the value that this new technology enables.

Ferguson gets extremely excited by the prospect when he talks about it. But he takes pains to explain that most of the needed technology exists today and that this is not just a pie-in-the-sky idea way off in the future.
"It's unstoppable, it's inexorable," he says. "This is going to happen." •
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