RFID Strategy -- Mindshare And RFID

Aug. 21, 2006
Thoughts on how print, Internet media affect perceptions of RFID industry.

One advantage of the consulting business is that I get to meet a large and diverse group of people during the performance of various projects. This allows me to stay in touch with the rank-and-file of the logistics industry, which provides a valuable perspective on technology issues -- a perspective that is different from most of the views found in the community of authors, experts and bloggers typically featured in RFID industrial publications.

In this month's column, I am stepping back from the technical details of the "tag wars" to share some insights on how the perceptions of RFID have changed over the last year.

More Sophisticated Questions Emerge

We often conduct educational demonstrations for clients at the Tompkins Emerging Technology Center. These demos cover a variety of supply chain technologies, including RFID, and I have noticed a big difference recently in the kind of questions I get about the technology. Up until two months ago, the majority of questions were pretty basic: "What do the tags look like? What are the read-rates? How do I use both barcodes and RFID? What kind of accuracy is Wal-Mart seeing with their tags?" One of the most common questions that we got last year was, "My management wants to implement an RFID pilot program, so how do I get one going as quickly as possible for the least cost?"

But lately, the questions have been more sophisticated. I have been fielding inquiries about the differences between UHF and HF tags; the differences between the Wal-Mart and FDA approaches to RF tag requirements; and ways of integrating RF readers onto material handling equipment to exploit any conceivable potential for return-on-investment.

This shows that the "RFID press" is having some success in educating the logistics industry in various issues regarding RFID technology. However, the most important question that I now field on a repeated basis concerns RFID security. I have seen an increase in nervousness about data security throughout the RFID-enabled supply chain. My clients are not getting this information from the industry press, which is overwhelmingly positive about the future of RFID. Instead, they are reacting to the occasional, well-publicized mainstream newspaper feature about such things as RFID-enabled credit cards and passports. For an example, see my April column, Is your cat infected with a computer virus?

Following Same Awareness Path As Internet

The progression of logistics-industry awareness of RFID technology noted above reminds me of similar developments during the emergence of the Internet in the 1990s. If you were around during the early days of web browsing, you will remember that Mosaic was a big deal when it made its debut. It was the earliest web-browser that gained a large following. At the time, everyone focused on the revolutionary potential of information-sharing embodied in the combination of web-browsers, the HTML standard, and increasingly affordable network access (if only via modem).

It was not long before technological enthusiasm turned to worries about computer security. Networking experts, of course, had been aware of such things well before the invention of the Worldwide Web, but it was only during the mainstreaming of web-browsing that the general public became aware of the issue. There were a lot of panicky articles written about security, and even one particularly silly Hollywood movie that had Sandra Bullock fighting evil cyber-villains using such computer utilities as "archie" and "finger."

The public was eventually educated in the benefits and pitfalls of the new technology, and we arrived at the current state of Internet technology. It's not perfect, but the benefits outweigh the problems and abuses.

Mindshare Matters

The lessons that the RFID industry (and consultants) can learn from comparison with the early evolution of the Internet are as follows:

  1. Mindshare matters. The pubic acceptance of a technology is often based on general impressions driven by the media.
  2. The public can learn to live with an element of technical risk (such as data sometimes winds up in the wrong hands), but only if the advantages of a technology far outweigh the drawbacks.

On the issue of mindshare, it is likely that the RFID companies with the biggest advertising budgets will prevail. Matters are less clear on the issue of risk versus benefit. On the retail side, the direct beneficiaries of RFID technology are companies such as Wal-Mart, not the public (although they presumably benefit from lower prices and better product availability). On the pharmaceutical side, the benefits of RFID to the public are more obvious -- better guarantees of pharmaceutical authenticity and traceability. The RFID industrial press will continue to play its role in presenting these issues to the public, with occasional cross-over articles in the mainstream press.


Finally, I would like to return to the questions I get during Emerging Technology Center demos. The most common question really hasn't changed because it is "How much do tags cost?" Given an answer of between 15 and 30 cents, the response is usually, "Call me when tags are a penny each." Therefore, despite the evolution of the RFID market, some concepts such as cost consciousness and ROI never change.

Paul Faber is a Principal with Raleigh, N.C.-based Tompkins Associates, a supply-chain-solutions consulting firm. As the chief manager of RFID equipment implementation at Tompkins Emerging Technology Center, Faber possesses extensive experience in material handling solutions, systems integration, and installation. He has managed field integration and operations activities at material handling sites around the world.

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