Introduction
Many businesses across the world have not been left behind by the recent developments and innovations in information technology. The IT infrastructure is evident virtually all operations of business and this has meant that for any one business to have a competitive advantage, it should apply the use of technology (Nyakio 2008). Specifically, the use of Radio Frequency Identification (RFIDs) tags has been widely become the most significant trends in technology. It has been widely used from handling of products, serving customers to making automatic payments in real time. In the past, most businesses relied on barcode scanners which were consuming a lot of time and resources. Days have changed and now, they have shifted to the use of RFIDs which can provide information without having to scan the product and hence increasing the efficiency of operations from one place to another.
The RFIDs are wireless devices that are usually powered by batteries and can be tracked electronically by use of computers. An RFID comprises of a transponder and an interrogator which is able to capture data. This information can be read electronically from a distance in real time through the use of radio waves (Randy 2009). Wall mart started using the RFID technology back in the year 2005 which has been a success and now has spread to various industries.
Over the past few years, business has changed as a result of the new developments in information technology (Wachira 2010). The RFIDs have increasingly been used in various applications including libraries and shops. Specifically, they have been used to improve the efficiency and quality of performing operations in organizations’ products and services.
a). Efficiency of operations
Inventory management
RFIDs have increased the efficiency of inventory management as the stocks can be tracked from time to time in real time. Most companies attach the RFIDs to their stocks so that they can monitor the level of stocks and replenish it as soon as possible. They make accurate records and ensure that the stocks do not run out (Raafat 2010). In fact, it saves a lot of time and costs that could have been used in employing so many workers to physically count stocks. The companies can also know the current levels of stocks across all branches and then make corrective measures in real time. At the airports, almost every company uses them to track the movement of luggage as well as in authentication. Any baggage that has been misplaced can be traced easily by the authorities. Unlike the barcodes, they cannot be destroyed or seen and therefore become very efficient in tracking. For example, British airways has projected to save over $700 million by using RFID technology which it believes it can assist in tracking the customers baggage and therefore improve its efficiency. The other company is the Hong Kong Airport which had successfully implemented the use of RFIDs to track its luggage. Wal-Mart is a good example of companies that ensure that goods are constantly available in the shelves by tracking the attached RFIDs in order to know stock levels. Ones the stock level fall below certain limits, then the supermarket automatically makes orders for addition of stock.
Supply chain management
The RFIDs can be attached by the manufacturers and then they are tracked as they are shipped from the manufacturer to the company (Angeles 2011). Any loss of goods while on transit can be detected in time and appropriate measures are taken. On reaching at the premises, the goods are placed on the shelves. It is not uncommon for supermarkets to use the RFIDs and detach them or deactivate them at the electronic point of sale (EPOS). Ones the stock levels fall below a certain level, the computer sends automatic message to the manufacturer who can then supply an additional stock (Sabbaghi 2008). This eliminates the cost incurred in employing people or running out of stock. For example, in Canada, a manufacturing company known as Canus has plans to use RFID technology to track shipments of its raw materials by having RFID temperature sensors which can detect the temperature level milk which is use in making the skin care products.
b). Quality of goods and services
Logistics
The good that are being transported can be tracked to check whether they have the same details as they were distributed from the manufacturer. This avoids any chances of goods being tampered with and therefore ensures that the goods are of high quality as ordered. The RFIDs record the details, size, type of goods and the codes so that they can be checked by both the buyer and supplier. DHL Company, which is one of the leading logistics company, has applied this technology to enable it track the clients’ goods a they are being transported to make the services to be of high quality. The company can track the goods with all details provided in the RFIDs which will contain all the codes necessary to ensure that whatever information is needed can be obtained. In case the goods are mishandled, then the company can track instantly. This eliminates the need for having many employees in the logistics to keep on monitoring the goods as well as the costs involved. Virtually, all logistics companies employ the use of RFID and this has improved the quality of services to the clients.
Authentication
The RFIDs are usually attached to the badges of employees so that the organization’s employees can easily be recognized to avoid any unauthorized persons from accessing certain restricted areas. Therefore customers can only be served by authorized persons and this enables the services to be well controlled within the organizations (Mehhotra 2007).
In libraries, the students are given such badges to ensure that there is control in the use of library services. The RFIDs attached to the books facilitate the process of retrieval of information in the libraries. It becomes very easy to locate books on the shelves. On the other hand, the students cannot walk out of the library with books that have not been cleared by authorized persons. In case a student walks out of the library with a book that has not been cleared, it can be detected through at the exit point by an alarm sound. The same case applies to supermarkets whereby every good has to be cleared at the counter before leaving the supermarket. The other company is Menlo Worldwide which is has successfully implemented the RFID technology for many years.
The RFIDs contain name of employee, job role, age and ID number. The employees have to swap the cards in order to unlock the doors.
The moment an employee arrives, he swaps a card with RFID tag which is read and message sent to the database to check authenticity after which he is allowed or denied access through the door unit. The record and details of employees are then kept in the database. This is an effective way of managing employees and ensuring that it is only the authorized persons can access restricted areas. It also increases the efficiency of operations at low cost levels.
Moreover, the RFIDs are also used to track the employees’ time of entrance and exit. This facilitates the quality of service being offered by the organization.
Counterfeit products
Many organizations have used the RFID tags on their products to track them and ensure that only the genuine ones have the RFIDs are to be sold. This has helped them eliminate the possibility of retailers selling counterfeits to the consumers as the RFIDs are attached by the manufacturing company. For example, in India, it has been reported that there is an increase in counterfeit drugs being traded in the market. In response to this, GSK and Purdue companies have applied the use of RFIDs to prevent these problems as well as retain the confidence in the market. Today, even currencies are identified by the RFIDs as banks can use computers to detect the fake notes and coins (Williams 2010).
Automated Payment
RFID technology is used in making automated payments through the swap cards that can be read by computers. The swap cards are used by clients in shopping and most businesses find this method of payment to be very efficient and convenient (Trivah 2009). It has also reduced the theft cases associated with handling large sums of money. Movie tickets in Japan can be obtained by customers who download them from the phones after swiping their cards over the phones and make automatic payments.
Manufacturing
Many manufacturers have found it convenient to use the RFID technology in tracking various parts of machines or components for maintenance purposes. For example, Boeing is reported to be using RFID technology in order to track the various parts of aircrafts as they are being manufactured and this eliminates the costs of labor associated with employing workers to track the movements or scan the parts. Other just in time (JIT) operations usually apply the use of RFIDs to enable them reduce their production cycle and hence provide the products at the shortest time possible.
Challenges facing RFIDs in business
Despite the many benefits derived from the use of RFIDs, there are also many challenges associated with the new technology. The new technology requires all employees to be trained on how well to use and manage the products that have which RFIDs have been attached. The organization has to invest large sums of money in the training and implementation of the new technology. Privacy is also other issues that have been experienced as a result of reading ones confidential information or personal details. Theft cases have arisen as persons misuse the clients’ information for ill motives and therefore some people do not like swiping their cards, instead, they prefer using cash payment (Mehmet 2008). Finally, the other challenge ahs been in the loss of jobs of many workers who have now been replaced by the RFID especially those working stock management departments.
Conclusion
In this research, the various applications of RFID technology in business have been discussed in details. These applications are useful across various industries and businesses regardless of their size or location. RFID technology has been in place for many years and now being used by businesses in the management of logistics, counterfeits, logistics, authentication, facilitation of automated payments and manufacturing among many other functions. It has examined the effectiveness and efficiency of operations in many companies that embrace the RFID technology. However, the RFID has come with other challenges in implementation which has seen some businesses delay in the shift of business to start using the RFIDs (Penorafa 2007).Despite the challenges, many businesses can only obtain a competitive advantage by using the RFIDs in order to boost their revenues as well as ensure efficiency in their operations which eventually becomes economical for them.
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