Innovation was on full display during last week’s RFID Live conference in Orlando. In many cases, the new applications showcased by vendors like Impinj and NXP interact heavily with consumers, bringing shoppers even closer to the technology.
Vendors were impressed with some of the new use cases brought to them by attendees during the show, a clear sign that RFID is reaching a tipping point in several industries.
Macy’s and American Apparel provided updates on their RFID deployments. Macy’s expects to have all 850 of its stores RFID enabled by August.
Impinj’s Monza X chips will power the new tablet device that Intel is releasing this fall. The chips will enable device configuration before the tablet leaves the store, and device to device connectivity once the tablet is authenticated to the cloud. A lock-in-transit feature will disable the device as it travels from the point of manufacture to the retailer, improving the integrity of the supply chain.
Shahrokh Shahidzadeh, senior principal technologist with Intel, says that the tablet is the first of many devices that Intel will launch with its device manufacturers that contain RFID for similar use cases. The Monza X chips enable users to communicate wirelessly with the processor inside electronic devices using standard UHF Gen 2 RFID readers, unlocking new benefits for consumer electronics manufacturers, retailers and end users.
Embedded directly into the circuit board of an electronic device, Monza X chips link to the device’s processor, enabling the processor or a UHF reader to read and write the Monza X chip memory even when the electronic device is powered off.
“We’ve invested a significant amount of time in creating a path to use RFID inside our products and our tablet will be first,” says Shahidzadeh. “Hopefully, we’ll start small and scale fast.”
During the retail presentation, Bill Connell, senior vice president of logistics and operations at Macy’s, provided an update on the retail chain’s plan to have RFID in all 850 stores by the third quarter. Connell, in fact, says that all Macy’s stores will be RFID capable by August.
Macy’s spent much of 2011 building the back room infrastructure required to compile reads and efficiently upload data from cycle counting. This February, Macy’s began deploying the service software and technology at its retail locations.
“We will be RFID capable in all Macy’s locations by August, and we are working with our suppliers — the largest of which is ourselves — to begin to understand the effort necessary to source tag,” says Connell. ”We’ve been working with a number of our suppliers in men’s furnishings and intimate apparel, and we are now engaging with the with broader spectrum of suppliers so that by 2013 we will be in position to work collaboratively with our supply base producing source tagged products.”
Connell says that Macy’s is pursuing a source tagging approach that will serve the retailer’s needs for replenishment categories and likely beyond that. He says that Macy’s had to begin with its own private label vendors, and that the retailer gained an advantage from doing so.
“We had to approach our private brands group as though they are a vendor,” says Connell. “We needed to make the same business case internally with private brands as we do with our market suppliers that this is a win-win. Any collaborative effort needs to demonstrate benefits for both parties.”
Connell says that it is becoming easier to sell suppliers on the value of source tagging as more use cases are uncovered that demonstrate how supplier’s can benefit from RFID in their own operations. “Suppliers are finding the very same inventory accuracy benefits in their facilities and efficiencies in how they operate their distribution networks,” he says.
Stacey Shulman, vice president of technology at American Apparel, says that her company is taking advantage of the 99.8 percent inventory accuracy from RFID to use stores as backup distribution centers for fulfilling online orders. “If the item is out of stock at the online fulfillment center, the order is pushed out to the store,” says Shulman. “We’re comfortable knowing that if the store says that they have the product, that they do in fact have the product.”
Shulman notes that online sales have increased by 30 percent since American Apparel started using its stores as backup fulfillment centers. While she attributes other factors to the sales gain, RFID has been a major factor behind the increase.
Lastly, Shulman and Connell delivered a strong message regarding tag costs.
“If you are focused on the tagging costs, you are focused on the wrong thing,” says Connell. “If you focus on what the benefits are that arise from the capability of RFID, you will quickly discover that the cost, relative to what you can accomplish,” should not be a factor.
“Tag costs were hard to swallow for our CEO,” says Shulman. “The cost of handling an article several times (without using RFID) needs to be factored into this. With RFID you don’t handle garments as often. If you are looking at eight cents a tag, what would that cost be without RFID?”
RFID Special Achievement
Congratulations to Bill Hardgrave, who received the RFID Special Achievement award at Journal Live. Hardgrave, dean of the College of Business at Auburn University, is the founder of the University of Arkansas RFID Research Center. His research has helped item level tagging to reach the tipping point in retail apparel.
“When we started the center in 2005, the industry was really just getting started, and we knew at that time that we had to focus on the business value of RFID,” said Hardgrave. “We knew that if we didn’t really understand how it could be used and if we couldn’t prove an ROI, that the best technology in the world might never be adopted. We’ve worked on that with laser focus for seven years, and the work continues.”
RFID 24-7′s Best Use Case
Saving the best for last, my favorite use case involved the state of Maryland’s decision to tag dead bodies. During my visit with Chris Warner at the Motorola booth, we were joined by Mike Eagle, director of information technology at the Office of the Chief Medical Examiner of Maryland. Within two months, Eagle says that the toe identification tags used to identify deceased bodies will be replaced with a passive RFID tag. By doing so, Eagle estimates that the the Medical Examiner’s office will be able to increase organ donations by 50 to 75 percent.
According to the website organdonor.gov, 113,770 people are waiting for some kind of organ transplant. Eighteen people die each day waiting for a donated organ. The group says that one organ donor can save up to eight lives. If a similar system were mandated in the U.S., it stands to reason that RFID enabled cadaver tracking could save more than 3,000 lives a year by making more organs readily available for transplant procedures.
Once a body arrives at the Medical Examiner’s office, the clock starts ticking for the opportunity to donate organs. Often, after next of kin is contacted, paperwork is completed and other procedural requirements, the window of opportunity for donating organs is greatly reduced. Eagle says that automating the process will allow transplant specialists to use time and temperature measurements to more reliably determine the viability of organs for transplant.
Eagle would also like to use active RFID with temperature sensors mounted on the gurney’s transporting cadavers to monitor storage and temperature conditions, further increasing transplant success rates.
The Maryland Medical Examiner’s Office began using an RFID system from File Trail for simple file tracking two years ago. By placing RFID readers from Motorola above the drop-ceiling at designated locations throughout the seven-story building, the location of the case files are updated as they are moved among clerk’s cubicles, elevator lobbies and key transition areas allowing users to view the current location of specific files.
These capabilities have saved employees valuable time that they would have previously spent searching for missing files. The increased efficiency has virtually eliminated the problem of misplaced files.