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Corey Woodward Jakrapan Somsakraksanti Nattapat Suadsong Yogi Kapur

EMERGING TECHNOLOGIES. (Group 4). Corey Woodward Jakrapan Somsakraksanti Nattapat Suadsong Yogi Kapur. April 11th 2007. VIDEO: IBM Commercial http :// www . youtube . com / watch?v =- ZYY85IyDNM , viewed April 5 th 2007. RFID (Radio Frequency Identification). --Innovative….

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Corey Woodward Jakrapan Somsakraksanti Nattapat Suadsong Yogi Kapur

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  1. EMERGING TECHNOLOGIES (Group 4) Corey Woodward Jakrapan Somsakraksanti Nattapat Suadsong Yogi Kapur April 11th 2007 VIDEO: IBM Commercial http://www.youtube.com/watch?v=-ZYY85IyDNM, viewed April 5th 2007

  2. RFID (Radio Frequency Identification) --Innovative…

  3. RFID (Radio Frequency Identification) …or Invasive?

  4. Topics that will be covered Radio Frequency Identification (RFID) • Why general managers should care • An introduction and brief history • The Wal-Mart Effect • Real-world applications • Security/controversies/myths • Lessons learned

  5. Why should general managers care?

  6. Why should general managers care? Enhanced supply chain management Inventory management: Fast, accurate inventory audits Increased efficiency: Faster processing, shipping, and receiving Better tracking: Links manufacturer floor to retailer floor Business Benefits from Radio Frequency Identification (RFID), Symbol Technologies Inc., September 2004, http://www.symbol.com/assets/files/RFIDBenefits.pdf , viewed April 4, 2007.

  7. Why should general managers care? Results of enhanced supply chain management Increased revenue: • Faster receiving, processing, and replenishment of inventory mean fewer “out of stock” situations and more sales opportunity. Reduced operating expenses: • Lower inventory levels lead to less waste and lower handling costs and labor requirements. Business Benefits from Radio Frequency Identification (RFID), Symbol Technologies Inc., September 2004, http://www.symbol.com/assets/files/RFIDBenefits.pdf , viewed April 4, 2007.

  8. What is RFID?A brief history and introduction

  9. Radio Frequency Identification (RFID) is a technology for automatically identifying objects through a system of tags, readers, and radio waves. Lin, P., & Brown, K. (2006).  Radio Frequency Identification and How to Capitalize on It.  The CPA Journal, 76 (7), 34-37.  

  10. Active vs. Passive tags Active tags have their own power source to broadcast information back to the reader. Passive tags use the power gathered from the electromagnetic waves sent from the reader. RFID FAQs.  Viewed February 21, 2007, from http://www.rfidjournal.com/faq

  11. Something like RFID World War 2: British IFF (Identify Friend or Foe) system uses transponders on planes to distinguish enemies from allies on radar. 1960’s: Electronic Article Surveillance equipment is used by retailers to curtail shoplifters. 1 bit chips in tags are placed on merchandise. First widely adopted commercial use of technology resembling RFID. The History of RFID Technology.  Viewed February 21, 2007, from http://www.rfidjournal.com/article/articleview/1338/1/129/

  12. Birth of modern RFID 1970s: Los Alamos National Laboratory develops an RFID system to track nuclear materials. Vehicles entering nuclear facilities contain transponders carrying information regarding vehicle’s contents and origin as well as driver’s ID. 1980s: RFID used at electronic toll payment stations on the world’s highway, bridges, and tunnels. Use of RFID develops in various industries. In Europe, animal tracking is popular. The History of RFID Technology.  Viewed February 21, 2007, from http://www.rfidjournal.com/article/articleview/1338/1/129/

  13. Widespread Use and Standardization of RFID 1991: Engineers develop a UHF RFID system. 1999: Auto-ID Center is established at MIT as a non-profit collaboration between professors and private companies. Professors develop the Electronic Product Code (EPC) putting serial numbers on tags which is the basis for an RFID networking structure capable of tracking items through the supply chain over the internet. 2003: EPCGlobal is established to further commercialize EPC technology. The EPC system has become the worldwide standard for RFID tracking along supply chains. The History of RFID Technology.  Viewed February 21, 2007, from http://www.rfidjournal.com/article/articleview/1338/1/129/ Landt, Dr. Jeremy (2001).  Shrouds of Time: The History of RFID.  Viewed February 21, 2007, from http://www.aimglobal.org/technologies/rfid/resources/shrouds_of_time.pdf

  14. Widespread Use and Standardization of RFID 1991: Engineers develop a UHF RFID system. 1999: Auto-ID Center is established at MIT as a non-profit collaboration between professors and private companies. Professors develop the Electronic Product Code (EPC) putting serial numbers on tags which is the basis for an RFID networking structure capable of tracking items through the supply chain over the internet. 2003: EPCGlobal is established to further commercialize EPC technology. The EPC system has become the worldwide standard for RFID tracking along supply chains. The History of RFID Technology.  Viewed February 21, 2007, from http://www.rfidjournal.com/article/articleview/1338/1/129/ Landt, Dr. Jeremy (2001).  Shrouds of Time: The History of RFID.  Viewed February 21, 2007, from http://www.aimglobal.org/technologies/rfid/resources/shrouds_of_time.pdf

  15. Encoding RFIDs • Companies (RFID users) use encoders to write information on to RFID tags • Read only tags: can only be written once • Read/write tags: can be encoded, erased, and then re-encoded • Encoding compliant w/ EPC protocols • Gen2 RFID tags take 240 milliseconds to encode Alien(R) Technology Opens Gen2 RFID Tag Writing Breakthrough to RFID Reader Industry (3/26/2007)http://www.stockhouse.com/news/news.asp?newsid=5010635&tick=RFID viewed April 15, 2007 The Write Stuff: Understanding the Value of RFID Read/Write Functionality (2003)http://epsfiles.intermec.com/eps_files/eps_wp/RFIDread_write_wp_web.pdf viewed April 15, 2007

  16. Dollars (in millions) spent worldwide on RFID Spending is projected to surpass $3 billion in 2010. Gartner: Worldwide RFID Spending to Surpass $3b in 2010. (2005, December 14) Viewed February 21, 2007, from http://www.rfidinternational.com/news.php?action=full_news&NewsID=106

  17. RFID costs continue to drop Average cost of an RFID tag in 2000 was $1. Today, tags can cost as little as 5 cents (for purchases over 100 million). Niemeyer, A., Pak, M., & Ramaswamy, S. (2003) Smart Tags for Your Supply Chain. McKinsey Quarterly, 2003 Issue 4, 6-9. Smartcode News &Analysis. (2006, May 1) Viewed April 7, 2007, from http://www.smartcodecorp.com/newsroom/01-05-06.asp

  18. RFID WaveThe Wal-Mart Effect

  19. World’s largest retailer • $344.992 billion sales revenue in Jan. 2006 • Leader in supply-chain management (SCM) • Proponent of RFID technology for use in SCM http://en.wikipedia.org/wiki/Wal-Mart , viewed April 4, 2007. Thomas Friedman, The World is Flat (Pages 161-162) viewed April 4, 2007.

  20. Before Wal-Mart was part of the RFID equation: • RFID technology deemed not practical for SCM • Lack of standardization • Hit-or-miss adoption • Lack of motivation due to high implementation costs • High costs of RFID tags David Williams (Jul 2004) The Strategic Implications of Wal-Mart's RFID Mandate. Retrieved February 23, 2007 http://www.directionsmag.com/article.php?article_id=629&trv=1/

  21. Wal-Mart’s announcement on June 11, 2003 • Top 100 suppliers to use crate/pallet RFID by Jan. 2005 • Top 200 mandated for Jan. 2006 “Our goal is to be live with the top 129 suppliers by Jan. ’05 in the Dallas market.” Linda Dillman, CIO of Wal-Mart in June 2003 Mark Roberti, eWeek RFID – Wal-Mart’s Network Effect, Sep 15 2003 , viewed April 5th 2007 Linda Dillman , viewed April 5th 2007 Rollin Ford , viewed April 5th, 2007 BW Online - Talking RFID with Wal-Mart's CIO , viewed April 5th, 2007

  22. Benefits following Wal-Mart’s mandate Cost of implementation (for suppliers) less than predicted Ripple effect (supplier’s supplier) driving down costs Standardization increasing adoption (EPCGlobal, Gen 2, ISO) Live (real world) production feedback for researchers 26% reduction in out-of-stocks after RFID deployment Other players jumping in, including DOD, Target, Best Buy David Williams (Jul 2004) The Strategic Implications of Wal-Mart's RFID Mandate. Retrieved February 23, 2007 http://www.directionsmag.com/article.php?article_id=629&trv=1/

  23. Bill Hardgrave Founder and Director RFID Research Center – University Of Arkansas “Much of the credit to the progress is attributable to RFID ‘end-users’ who, through extensive testing in the field, provided invaluable feedback to the RFID technology providers for ways to improve the technology.” The ACNeilsen global RFID news Bill Hardgrave: Talks with ACNeilsen on today's RFID practices and innovations

  24. Benefits following Wal-Mart’s mandate Cost of implementation (for suppliers) less than predicted Ripple effect (supplier’s supplier) driving down costs Standardization increasing adoption (EPCGlobal, Gen 2, ISO) Live (real world) production feedback for researchers 26% reduction in out-of-stocks after RFID deployment Other players jumping in, including DOD, Target, Best Buy David Williams (Jul 2004) The Strategic Implications of Wal-Mart's RFID Mandate. Retrieved February 23, 2007 http://www.directionsmag.com/article.php?article_id=629&trv=1/

  25. Survey Have you heard of a new technology called RFID? “Many of the early gains coincided with news reports about RFID deployment in pharmaceutical and retail settings, most notably Wal-Mart.” Linda Stegeman, President of Artafact Research, and co-sponsor of the study along with BIGresearch • Consumer awareness of RFID technology now stands at 42.4%, up from 28.2% • Two out of every five adults claim to have heard of a new technology called RFID. • Coincidental with flat awareness is the lack of media coverage since April 2005. “RFID appears to have returned to being more of a business story than a consumer story, but that could change quickly.”Phil Rist, BIGresearch PRESS RELEASE RFID Buzz Research (In collaboration by BIGResearch and Artafact Research) http://www.marketwire.com/mw/release_html_b1?release_id=101380, viewed April 5th 2007

  26. What does Wal-Mart know? Ability to know where item is in supply chain could save retailers billions of dollars per year. • Savings Estimate • $6.7 Billion: Reduced labor costs (by 15 percent) • $600 Million: Reduced out-of-stocks (using smart shelves to monitor on-shelf availability) • $575 Million: Reduced employee theft, administrative error and vendor fraud (by tracking and scanning products automatically) • $300 Million: Improved tracking of the more than 1 billion pallets and cases • $180 Million: Reduced Inventory (due to improved visibility. less holding costs) • Total pre-tax estimated savings: $8.35 Billion(Higher than the total revenue of more than half the companies on the Fortune 500) Mark Roberti, eWeek Sep 2003 The bottomline for Wal-Mart’s RFID research http://www.cioinsight.com/print_article/0,3668,a=61672,00.asp

  27. The Wal-Mart Effect An Example Campbell’s Conversion to RFID • Initial hesitation, even resistance to Wal-Mart’s mandate “We're not Gillette; we sell low-value products that aren't out of stock a lot. We're not going to get any value out of this.” - Campbell’s Executive in 2005 • Pilot tests on promotional cases yield good results Wal-Mart is sending data from RFID-enabled stores back to Campbell’s tagging pallets, cases, and promotional displays within 30 minutes of a tag being read. This data has enabled Campbell’s to execute promotions and boost sales. • Now an active proponent of RFID “We're already seeing value. It's hard to dispute the value of this technology.” Campbell’s Soup CIO Doreen Wright Feb 2007 Mark Roberti (Feb 2007)Wal-Mart, Suppliers  Affirm RFID Benefits. Retrieved February 23, 2007 https://www.rfidjournal.com/article/articleview/3059/1/1/ http://www.rfidjournal.com/article/view/3068/

  28. RFIDReal-world applications(focus on healthcare industry)

  29. Global market for RFID in healthcare 2006-2016 by value From $90 million in 2006 to $2 billion in 2016 IDTechEx : Rapid adoption of RFID in healthcare http://www.idtechex.com/printelecreview/en/articles/00000470.asp, viewed April 6, 2007.

  30. Drug anti-counterfeiting The largest use of RFID in healthcare will be on drug labels. This will enable drug companies to prevent fake products. Ex.: pharmaceutical bottles 600 tags per minute Embedding tags in containers : Modern Materials Handling, Dec2006, Vol. 61 Issue 13, p20-20, 1/3p; (AN 23532476) http://www.umsl.edu:3417/ehost/pdf?vid=1&hid=117&sid=c45d1992-48bc-482f-a321-71448ed872b3%40sessionmgr106 Newspaper Source: Sun helps fight drug counterfeiting with RFID technology; New RFID solution enables pharmaceutical companies to track and verify drug packages and helps prevent diverting and counterfeiting of products,  M2PressWIRE, Nov 15, 2005

  31. Error prevention To ensure that doctors perform the right surgery on the right person Wrongful surgeries kill thousands of patient a year Innovative uses of RFID tags http://www.primidi.com/2004/11/20.html, viewed April 6, 2007.

  32. RFID in Singapore In June 2003, RFID was used to fight SARS (Severe Acute Respiratory Syndrome) RFID Journal : Singapore fights SARS with RFID http://www.rfidjournal.com/article/view/446, viewed April 6, 2007.

  33. 2 hospitals in Singapore tested RFID system to track the movement of staff, visitors, and patients They spent $100,000 on RFID pilot

  34. Whenever a person enters or exits the hospital, this movement will be recorded automatically Anyone who wants to enter the areas must provide their name and contact information Then they will receive a RFID card that has a small battery inside.

  35. The tag operates at 433 mhz A receiver is installed in the ceiling • Found no SARS case, so they’ve never • tracked back the contacts RFID Journal : Singapore fights SARS with RFID http://www.rfidjournal.com/article/articleview/520/1/1/, viewed April 6, 2007.

  36. Benefit No interruption with any operation in the hospital No interference with any equipment in the hospital Doesn’t require staff to perform extra duties

  37. Benefit (Con’t) Track a person in real-time (RTLS) = Real Time Locating Systems Check and track who had contact with a patient when and where RFID can track unlimited number of people, but no more than 100 RFID cards at a time

  38. Drawback There were some blind spots Receiver can’t find the signal. It needs to find the perfect frequency. if too sensitive = overlap in the signal if not sensitive enough = can’t find the signal

  39. RFIDReal-world applications(various industries) VIDEO: Spotlight on RFID Technology. http://www.aimglobal.org/Services/RFIDSpotlight.asp,viewed April 5th 2007

  40. Animal Identification Library System Personnel & Asset Tracking Airport Security Supply Chain Management

  41. Current Usage

  42. RFIDSecurity/controversies/myths

  43. Security controls for implementing an RFID application • Contract with contractors and trading partners • Password management • Virus control Securing RFID Applications: Issues, Methods, and Controls. By: So, Stuart C. K.; Liu, John J.. Information Systems Security, Sep/Oct2006, Vol. 15 Issue 4, p43-50, 8p; (AN 22287939)

  44. Controversy RFID books example: Supporter/Anti-Supporter http://web.ecs.baylor.edu/faculty/newberry/myweb/Ethics/Web%20Pages/Shih%20test/rfid_controversy.htm, viewed April 5th eWeek, 3/22/2004, Vol. 21 Issue 12, p64-64, 1p; (AN 12612875) No RFID for library books., viewed April 5th 2007

  45. Common RFID Myths • Thieves can drive around the block and read RFID tags inside your home. Reality: 10-foot range; affected by water/metal • RFID tags store sensitive personal information. Reality: Limited storage; 14 digit UPC code Bill Hardgrave and Robert Miller (March 2006), The Myths and Realities of RFID Retrieved February 23, 2007, from RFID Research Center White Papers http://itri.uark.edu/RFID/whitepapers.asp

  46. Common RFID Myths • RFID is replacing the barcode. Reality: Not anytime soon; cost/reliability factors • RFID can be used to continuously track people/objects wherever they go. Reality: Can operate only in read zones. Bill Hardgrave and Robert Miller (March 2006), The Myths and Realities of RFID Retrieved February 23, 2007, from RFID Research Center White Papers http://itri.uark.edu/RFID/whitepapers.asp

  47. Lessons Learned • A great deal of potential for supply chain and other industries • Unrealistic expectation and negative perception – both harmful • Technology still maturing • Costs of technology are coming down • Need good business models to derive maximum benefit

  48. RFID costs continue to drop Average cost of an RFID tag in 2000 was $1. Today, tags can cost as little as 5 cents (for purchases over 100 million). Niemeyer, A., Pak, M., & Ramaswamy, S. (2003) Smart Tags for Your Supply Chain. McKinsey Quarterly, 2003 Issue 4, 6-9. Smartcode News &Analysis. (2006, May 1) Viewed April 7, 2007, from http://www.smartcodecorp.com/newsroom/01-05-06.asp

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