What is RFID?

Radio frequency identification (RFID) is a generic term that is used to describe a system that transmits the identity (in the form of a unique serial number) of an object or person wirelessly, using radio waves. It's grouped under the broad category of automatic identification technologies.

RFID is in use all around us. If you have ever chipped your pet with an ID tag, used EZPass through a toll booth, or paid for gas using SpeedPass, you've used RFID. In addition, RFID is increasingly used with biometric technologies for security.

Unlike ubiquitous UPC bar-code technology, RFID technology does not require contact or line of sight for communication. RFID data can be read through the human body, clothing and non-metallic materials.

Components

A basic RFID system consists of three components:

• An antenna or coil


• A transceiver (with decoder)


• A transponder (RF tag) electronically programmed with unique information

• The antenna emits radio signals to activate the tag and to read and write data to it.


• The reader emits radio waves in ranges of anywhere from one inch to 100 feet or more, depending upon its power output and the radio frequency used. When an RFID tag passes through the electromagnetic zone, it detects the reader's activation signal.


• The reader decodes the data encoded in the tag's integrated circuit (silicon chip) and the data is passed to the host computer for processing.

The purpose of an RFID system is to enable data to be transmitted by a portable device, called a tag, which is read by an RFID reader and processed according to the needs of a particular application. The data transmitted by the tag may provide identification or location information, or specifics about the product tagged, such as price, color, date of purchase, etc. RFID technology has been used by thousands of companies for a decade or more. . RFID quickly gained attention because of its ability to track moving objects. As the technology is refined, more pervasive - and invasive - uses for RFID tags are in the works.

A typical RFID tag consists of a microchip attached to a radio antenna mounted on a substrate. The chip can store as much as 2 kilobytes of data.

To retrieve the data stored on an RFID tag, you need a reader. A typical reader is a device that has one or more antennas that emit radio waves and receive signals back from the tag. The reader then passes the information in digital form to a computer system.

Current and Potential Uses of RFID

Asset Tracking
It's no surprise that asset tracking is one of the most common uses of RFID. Companies can put RFID tags on assets that are lost or stolen often, that are underutilized or that are just hard to locate at the time they are needed. Just about every type of RFID system is used for asset management. NYK Logistics, a third-party logistics provider based in Secaucus, N.J., needed to track containers at its Long Beach, Calif., distribution center. It chose a real-time locating system that uses active RFID beacons to locate container to within 10 feet.

Manufacturing
RFID has been used in manufacturing plants for more than a decade. It's used to track parts and work in process and to reduce defects, increase throughput and manage the production of different versions of the same product.

Supply Chain Management
RFID technology has been used in closed loop supply chains or to automate parts of the supply chain within a company's control for years.

As standards emerge, companies are increasingly turning to RFID to track shipments among supply chain partners.

Retailing
Retailers such as Best Buy, Metro, Target, Tesco and Wal-Mart are in the forefront of RFID adoption. These retailers are currently focused on improving supply chain efficiency and making sure product is on the shelf when customers want to buy it.

Payment Systems
RFID is all the rage in the supply chain world, but the technology is also catching on as a convenient payment mechanism. One of the most popular uses of RFID today is to pay for road tolls without stopping. These active systems have caught on in many countries, and quick service restaurants are experimenting with using the same active RFID tags to pay for meals at drive-through windows.

Security and Access Control
RFID has long been used as an electronic key to control who has access to office buildings or areas within office buildings. The first access control systems used low-frequency RFID tags. Recently, vendors have introduced 13.56 MHz systems that offer longer read range. The advantage of RFID is it is convenient (an employee can hold up a badge to unlock a door, rather than looking for a key or swiping a magnetic stripe card) and because there is no contact between the card and reader, there is less wear and tear, and therefore less maintenance.

As RFID technology evolves and becomes less expensive and more robust, it's likely that companies and RFID vendors will develop many new applications to solve common and unique business problems.

DOD Releases Final RFID Policy

We did a lot of due diligence and had a clear idea of what we wanted to do, so the final proposals are pretty close to the draft put out earlier in the year," says Alan Estevez, assistant deputy undersecretary of defense for supply chain integration. "We've added a lot more detail around tag data standards and business rules."

RFID tags will be mandatory in DOD contracts issued as of Oct. 1, 2004, for delivery of materiel on or after Jan. 1, 2005. The department published its policy guidelines in three appendixes to a memo from Acting Undersecretary of Defense Michael Wynne, dated July 30. The memo states that all contracts with the DOD shall require that passive tags be applied to cases and pallets and to individual high-value items (those currently requiring the military's Unique Identification code, or UID).

The DOD will incorporate the policy into the next update of the Defense Federal Acquisition Regulation, the Defense Transportation Regulation, and the Military Standard 129, which outlines the standard military practices for labeling goods in the supply chain.

The first appendix to Wynne's memo spells out the policy for tagging freight containers, including 20- and 40-foot seagoing cargo containers and large airborne pallets. All containers being shipped outside of the continental United States must have active (battery-powered) tags with the contents of the container written into them at the point of origin.

A second appendix spells out the requirements for passive RFID tagWe did a lot of due diligence and had a clear idea of what we wanted to do, so the final proposals are pretty close to the draft put out earlier in the year," says Alan Estevez, assistant deputy undersecretary of defense for supply chain integration. "We've added a lot more detail around tag data standards and business rules."

RFID tags will be mandatory in DOD contracts issued as of Oct. 1, 2004, for delivery of materiel on or after Jan. 1, 2005. The department published its policy guidelines in three appendixes to a memo from Acting Undersecretary of Defense Michael Wynne, dated July 30. The memo states that all contracts with the DOD shall require that passive tags be applied to cases and pallets and to individual high-value items (those currently requiring the military's Unique Identification code, or UID).

The DOD will incorporate the policy into the next update of the Defense Federal Acquisition Regulation, the Defense Transportation Regulation, and the Military Standard 129, which outlines the standard military practices for labeling goods in the supply chain.

The first appendix to Wynne's memo spells out the policy for tagging freight containers, including 20- and 40-foot seagoing cargo containers and large airborne pallets. All containers being shipped outside of the continental United States must have active (battery-powered) tags with the contents of the container written into them at the point of origin.

A second appendix spells out the requirements for passive RFID tags. It says: "To facilitate the use of RFID events as transactions of record, the DOD has embraced the use of Electronic Product Code tag data constructs, as well as DOD tag data constructs, in supporting the DOD data environment. As the available EPC technology matures, the intent is to expand the use of passive RFID applications.

The DOD plans to use passive UHF tags operating between 860 MHz and 960 MHz with a minimum read range of three meters (about 9 feet). Until EPC UHF Gen 2 tags and readers are available, the DOD will accept Class 0 64-bit read-only tags, Class 1 64-bit read-write tags, Class 0 96-bit read-only tags and Class 1 96-bit read-write tags. Once Gen 2 tags and readers are available, the DOD will phase out Class 1 and Class 0 tags.

Suppliers to the DOD must encode an approved tag using either an EPC tag data construct or a DOD tag data construct. Suppliers that choose to use the DOD construct will essentially replace the manufacturer ID in the EPC number with a Commercial and Government Entity code. EPCglobal subscribers can use a standard EPC, so consumer packaged goods manufacturers can use the same tags they use for Wal-Mart for the DOD.

The passive tag appendix provides details on when specific EPC data constructs—including Serialized Global Trade Item Number and Serial Shipment Container Code—should be used (the entire memo, including all three appendixes, can be downloaded from the www.dodrfid.org Web site). It also spells out in detail how many bits of data on the tag should be used for the elements of the data construct, including the company prefix, item reference and serial numbers.

Later this year the Defense Logistics Agency (DLA) will install RFID readers and supporting infrastructure at strategic distribution centers in San Joaquin, Calif., and Susquehanna, Penn. The tagging of deliveries to the DOD will be phased in by procurement method, type of goods, location and layer of packaging.

Beginning Jan. 1, 2005, suppliers have to attach passive EPC tags to all individual cases, all cases packaged within a pallet and all pallets of packaged troop rations, clothing, individual equipment and tools, personal items and weapons systems repair parts and components shipped to the two DLA distribution centers.

Beginning Jan. 1, 2006, suppliers will be required to tag cases and pallets of subsistence and comfort items, packaged petroleum, lubricants, oils, preservatives and chemicals, construction and barrier material, ammunition of all types, pharmaceutical and medical material shipped to 32 depots throughout the United States and the two DLA distribution centers.

Beginning Jan. 1, 2007, all cases and pallets of all commodities shipped to all DOD locations should be tagged.

"We are working to create a contractual clause so that will become a contractual requirement," says Estevez. "We are also updating our labeling standard that is already a contractual requirement to require the application of an RFID tag with these data constructs."

The policy will require suppliers to send advance shipping notices via existing Electronic Data Interchange (EDI) networks, rather than the EPC network, to get transactional data into the DOD’s back-end software systems. "We have no immediate plans to use the EPC Network," says Estevez. "We're certainly talking to EPCglobal and looking at how the network will evolve and assessing the value it can provide to us."

The policy also doesn't require data on the tag to be encrypted. Estevez says one reason is that the information on a passive tag is simply a serial number that means nothing until it’s associated with information in a database, and the second reason is potential enemies should not be able to get close enough to read the tags. "If we have people within 10 feet who are able to read a passive tag—or even 300 feet for an active tag—then we have bigger problems than them knowing what items are in our supply chain," he says.

The RFID policy memo doesn't spell out how the DOD branches should pay for the RFID equipment—another memo will be issued to deal with that issue—but it does say that in 2007 and beyond, all data collection devices purchased should be RFID enabled, so all bar code scanners should also have RFID capabilities.

"You are going to make a purchase anyway, so the cost [of the RFID reader] is now just the marginal cost between a standard bar code reader and an RFID reader," says Estevez. "In 2007, I'm not sure that difference in cost is going to mean anything, but if it does, we have plenty of time to make adjustments."

The DOD has run a number of pilots over the past few months, and Estevez says that these produced no surprises and justified the military's view that RFID was worth the investment. It's not just that the DOD can reduce inventory. RFID could help the DOD better support soldiers in the field.

"Better management of inventory means weapons systems are up and operating more of the time," he says. "That's where the big savings are, because if we can keep our weapons systems up and running through better inventory management, then theoretically we need fewer weapons systems to have the same war fighting capability."

s. It says: "To facilitate the use of RFID events as transactions of record, the DOD has embraced the use of Electronic Product Code tag data constructs, as well as DOD tag data constructs, in supporting the DOD data environment. As the available EPC technology matures, the intent is to expand the use of passive RFID applications.

The DOD plans to use passive UHF tags operating between 860 MHz and 960 MHz with a minimum read range of three meters (about 9 feet). Until EPC UHF Gen 2 tags and readers are available, the DOD will accept Class 0 64-bit read-only tags, Class 1 64-bit read-write tags, Class 0 96-bit read-only tags and Class 1 96-bit read-write tags. Once Gen 2 tags and readers are available, the DOD will phase out Class 1 and Class 0 tags.

Suppliers to the DOD must encode an approved tag using either an EPC tag data construct or a DOD tag data construct. Suppliers that choose to use the DOD construct will essentially replace the manufacturer ID in the EPC number with a Commercial and Government Entity code. EPCglobal subscribers can use a standard EPC, so consumer packaged goods manufacturers can use the same tags they use for Wal-Mart for the DOD.

The passive tag appendix provides details on when specific EPC data constructs—including Serialized Global Trade Item Number and Serial Shipment Container Code—should be used (the entire memo, including all three appendixes, can be downloaded from the http://www.dodrfid.org/ Web site). It also spells out in detail how many bits of data on the tag should be used for the elements of the data construct, including the company prefix, item reference and serial numbers.

Later this year the Defense Logistics Agency (DLA) will install RFID readers and supporting infrastructure at strategic distribution centers in San Joaquin, Calif., and Susquehanna, Penn. The tagging of deliveries to the DOD will be phased in by procurement method, type of goods, location and layer of packaging.

Beginning Jan. 1, 2005, suppliers have to attach passive EPC tags to all individual cases, all cases packaged within a pallet and all pallets of packaged troop rations, clothing, individual equipment and tools, personal items and weapons systems repair parts and components shipped to the two DLA distribution centers.

Beginning Jan. 1, 2006, suppliers will be required to tag cases and pallets of subsistence and comfort items, packaged petroleum, lubricants, oils, preservatives and chemicals, construction and barrier material, ammunition of all types, pharmaceutical and medical material shipped to 32 depots throughout the United States and the two DLA distribution centers.

Beginning Jan. 1, 2007, all cases and pallets of all commodities shipped to all DOD locations should be tagged.

"We are working to create a contractual clause so that will become a contractual requirement," says Estevez. "We are also updating our labeling standard that is already a contractual requirement to require the application of an RFID tag with these data constructs."

The policy will require suppliers to send advance shipping notices via existing Electronic Data Interchange (EDI) networks, rather than the EPC network, to get transactional data into the DOD’s back-end software systems. "We have no immediate plans to use the EPC Network," says Estevez. "We're certainly talking to EPCglobal and looking at how the network will evolve and assessing the value it can provide to us."

The policy also doesn't require data on the tag to be encrypted. Estevez says one reason is that the information on a passive tag is simply a serial number that means nothing until it’s associated with information in a database, and the second reason is potential enemies should not be able to get close enough to read the tags. "If we have people within 10 feet who are able to read a passive tag—or even 300 feet for an active tag—then we have bigger problems than them knowing what items are in our supply chain," he says.

The RFID policy memo doesn't spell out how the DOD branches should pay for the RFID equipment—another memo will be issued to deal with that issue—but it does say that in 2007 and beyond, all data collection devices purchased should be RFID enabled, so all bar code scanners should also have RFID capabilities.

"You are going to make a purchase anyway, so the cost [of the RFID reader] is now just the marginal cost between a standard bar code reader and an RFID reader," says Estevez. "In 2007, I'm not sure that difference in cost is going to mean anything, but if it does, we have plenty of time to make adjustments."

The DOD has run a number of pilots over the past few months, and Estevez says that these produced no surprises and justified the military's view that RFID was worth the investment. It's not just that the DOD can reduce inventory. RFID could help the DOD better support soldiers in the field.

"Better management of inventory means weapons systems are up and operating more of the time," he says. "That's where the big savings are, because if we can keep our weapons systems up and running through better inventory management, then theoretically we need fewer weapons systems to have the same war fighting capability."

RFID versus Bar Codes

Tips on deploying RFID in the Supply Chain

With all the noise around RFID, it seems like bar code technology - today's standard for data collection - will become obsolete overnight. Although RFID promises to be a more comprehensive data collection technology, the still emerging standards and lack of end-to-end, supply chain RFID deployments are making customers think twice before taking the plunge.

Hybrid solutions that leverage both bar code and RFID technology are one way that customers can meet the compliance guidelines of Wal-Mart and the Department of Defense (DOD) without overhauling their entire data collection process. The key to deploying a hybrid solution is understanding the differences and benefits of both technologies and taking this into account before implementing RFID in your operations.

Bar codes have become the standard for identifying and tracking objects in the supply chain whether it is cereal boxes at the grocery store or children's books at the public library. Although bar codes are ubiquitous in the supply chain, RFID technology offers key benefits that increase transparency across the product handling lifecycle.

One key benefit is that with RFID, there is no need for line of sight back to a reader whereas bar codes require a scanner to pass over each item. RFID enables pallets of products to pass through a stationary portal reader and the information is automatically captured -requiring less human intervention in the data capturing process. Unlike bar code technology, multiple RFID tags can be identified simultaneously and they often have a longer life span than bar codes because they can be produced in a variety of form factors depending on the environment.

Also, the data capabilities of an RFID tag are superior to a bar code. Product maintenance instructions, shipping histories, manufacturing and expiry dates are just a few examples of the types of information that can be programmed onto an RFID tag. This information can help track specific products as they move through the supply chain giving a detailed snapshot of how a product was handled from the moment it enters the warehouse to when it is purchased by a consumer.

Although there are advanced capabilities and benefits of RFID technology, many companies will not abandon the use of bar codes within their operations. An example of this would be equipping part of an operation with RFID technology (often to meet compliance initiatives) but still have the bulk of the data capture task within operations delivered by barcodes. A hybrid solution is a safe option that allows organizations to leverage both technologies - minimizing risks and costs.

When deploying RFID, there are four key considerations to take into account before an implementation:

• Consider the capabilities of different RFID technologies in relation to specific applications.
  
  
• Look for hardware that can support both bar code and RFID technology.
  
  
• Understand that since RFID data is captured differently than traditional bar code data, it will need to be managed in another way.
  
  
• Identify a solution provider that has experience with the technology and the ability to provide low-risk solutions.

One reason RFID pilots fail is because the technology's limitations were not considered for the specific application. In the supply chain, Ultra High Frequency (900 MHz) has been chosen for RFID compliance initiatives with the Department of Defense (DoD) and Wal-Mart and is a primary focus of the EPCglobal initiative. Although UHF delivers long read ranges and high data throughput rates, it has a limited ability to penetrate liquid or metal objects. Organizations must take these limitations into account when deploying EPC-compliant RFID solutions.

Another consideration for RFID supply chain deployments is tag type. Today you can choose from UHF class 0 read-only tags or class 0+ and class 1 tags having both read and write capabilities. These different classes are currently not interoperable. This is a short-term problem as EPCglobal is working with several industry players to develop a universal protocol called UHF Gen2 to provide a global standard within the supply chain. In the interim, companies should look for "agile or multi-protocol" readers that can read different tag types as well as operate with bar code technology. For example, Psion Teklogix' offers an agile UHF tethered reader that reads class 0, 0+ and class 1 tags. This reader can be connected to devices such as the Psion Teklogix 7535 hand-held computer, giving customers a solution for both RFID and bar code needs.

An additional consideration when deploying RFID is determining how to manage the influx of data. Companies need to make provisions to collect and filter data coming from multiple sources, manipulate and evaluate the information and send it to a management system. If these steps are not taken, the accuracy of the data obtained through the RFID system cannot be validated and the management system could potentially be overwhelmed by data as the RFID system continues to read tags multiple times. Psion Teklogix currently offers Enterprise level software designed to reconcile RFID data with other management systems, ensuring customers get an accurate snapshot of their operations.

The final consideration when deploying an RFID pilot is to work with a solution provider who understands the benefits and limitations of RFID technology. It is important to look for companies that have proven experience with the technology, the ability to provide low-risk and systematic solutions and support throughout the course of the implementation.

RFID technology has stormed the supply chain industry and customers are trying to fit the pieces of the technology puzzle together. It is important to see through the hype and realize that bar codes will not be replaced by RFID overnight. The new reality for many customers will be a hybrid solution that leverages both technologies to deliver enhanced visibility across the supply chain. Can RFID and bar code technology co-exist in today's supply chain? Absolutely.