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The Truth About RFID

Food Digital – June 2013

The Truth about RFID in FoodDigital Magazine
12 JUN 2013 

Radio frequency identification technology – it’s a concept we hear about it all the time in a thousand different capacities, from executives touting the limitless potential in business applications to newscasters raising concern about the spooky potential of its personal identification applications. Sometimes it can be hard to separate the facts from the science fiction, which can be especially frustrating for a business that is considering integrating RFID technology into its supply chain operations.

RFID is all in a day’s work for Chris Castaldi, Manager of Business Development at logistics consulting group W&H Systems, who saw the technology explode onto the scene before settling in to take its place as just one instrument in a supply chain expert’s toolbox.

“At one point RFID was all that anybody talked about and dreamed about – it was completely new and completely innovative and, like any new and really innovative thing, you don’t know exactly where it’s going and how it’s going to be applied,” says Castaldi. “Now we know what it is, we know what we can do and how we can use it, and it’s just not in the limelight the way that it was a few years ago.”

But while RFID may no longer be a brand new technology in the spotlight, it’s still a very relevant technology with real world applications that could make it appealing to many manufacturers and third party logistics companies. But first they need to know what it is and isn’t capable of, and what they need to consider before making it a part of their system.

“RFID allows you to have more in-depth information on a SKU or product than you could on just a bar code, and you get not just more information and more depth about the facts of it, but you don’t have to always be looking right at the item to get that information,” Castaldi explains. “When you go to Costco and they scan everything, you have to make sure that the barcode’s facing up for them to read everything; with RFID, you can read the item or items without having to handle it to get the barcode up on top. So you have more data and it’s easier to collect, because it’s a radio signal. A barcode is a sign on the wall, and this is broadcasting – anything that’s within range of it can read that code and get that information.”

That range is an aspect of RFID technology that can scare some potential users away, wary of those that might abuse the information stored in a product’s signal, but Castaldi is quick to debunk that aspect as fiction.

“I think the world has been told that [someone] could drive down the block and tell what you’ve bought or what drugs you’re taking, and it’s not even close to true,” he says. “The tags are not that powerful, people can’t get that close – it’s like how we don’t receive radio stations from China here on our AM radio. People can’t find out your personal habits by driving down the block and looking at them. We worry about being able to read the tags, not that somebody else is reading them and using it against you. Somebody could find out more by just by rummaging through your garbage can.”

So now that the reality and the myth of RFID’s capabilities has been laid out, what are some real factors that a business should consider before bringing the technology into its operations? According to Castaldi, it’s the simple matter of determining whether it will help you achieve your goals.

“That’s always the key in anything: it’s not the technology, it’s the process,” says Castaldi. “People chase technology and go: what do I need to collect? But if you’ve got boxes that are all the same, and they’re traveling down a conveyor and that label is always on the top, there are simple ways to do that already – it may be easier to read it with a barcode scanner because the only data you’re trying to get is the lot number or the SKU. We often study the process and say ‘what challenges exist in the process that we can apply technology to in order to overcome them,’ instead of jumping to ‘hey, I want to put RFID in.’ You can start by thinking why you don’t need technology, versus the processes that it could eliminate for you to make you more efficient. I think that’s one of the key things that people need to analyze is the process – can you change something elsewhere? Can you do something simpler in the process to eliminate your need for the technology? A lot of people chase technology first, but I preach: start with the process. Refine it. When you hit a roadblock you can’t get over, then look for the technology to help you through that roadblock – especially when you’ve proven that the process is right.”

Castaldi explains that, whether it applies to RFID or barcode scanners or upgrading conveyor systems, that thread of logic is W&H Systems’ bread and butter for helping businesses make good decisions about their logistics operations. “It always starts with the process – that’s the key,” he says. “We need to understand what you’re trying to achieve and what challenges you have today. Always measure your return on investment. Great, you’re going to spend X amount – by improving this process, how long does it take to return X? What do you get out of it? What costs are you going to eliminate? If it’s labor or chargebacks or reduced rentals, all of those have to be measured out to cost justify why you’re buying this. People need to be able to answer that all the time: I’m doing this because it’s going to save this, improve this, and that improvement gets me what? As long as people can answer that question, then there can be real success in any project.”