Introduction
As organizations from different markets and spheres encounter various issues, they try to create a unique and effective solution that would help them optimize their operations, gain more profit, and retain customers. For example, controlling quality processes, reducing logistics costs, managing stock, tracking and searching items, and communicating with people at the workplace became more challenging, and a new technological solution became needed. As a result, radio-frequency identification, or RFID, was invented to make all these and other processes easier. It is evident that the use of RFID technology is quite beneficial for companies operating in the retail industry, but they also face additional concerns associated with this technology. Most of these problems are discussed in an article by Kumar et al. (2009). The purpose of this paper is to review them and then offer effective solutions, identifying an industry and a company that can benefit from them.
Challenges and Issues Facing RFID Technology
It is possible to divide the problems and barriers faced by companies that use RFID technology into six distinct categories, including compliance, reliability, cost, privacy, compatibility, and hardware issues. Overall, considering the fact that the article by Kumar et al. (2009) was written more than a decade ago, the “immaturity of the industry” and its underdeveloped standards are not acute problems anymore. Although the retail industry has become a more mature sphere, the challenges explored by the authors are still relevant for current firms.
Thus, the first concern of RFID integration to discuss is poor compliance. According to Kumar et al. (2009), not all organizations choose to implement this technological solution and those who do not manage to forgo their costs and become more price-competitive. In other words, “competing against a firm that does not absorb such a cost will deteriorate market share in a heavily elastic industry” (Kumar et al., 2009, p. 65). As a consequence, this inconsistency is a severe concern that leads to other problems.
Secondly, it is highly questionable whether RFID technology is reliable enough for companies to adopt it at a high cost. As noticed by Kumar et al. (2009) and Fescioglu-Unver et al. (2015), data received when using this technology is not always accurate or relevant. Thus, there are cases when inaccuracies are detected “when scanning items deep into pallets, or liquid-carrying containers” (Kumar et al., 2009, p. 66). This is one reason why many organizations question the need to comply with this integration.
Thirdly, it is quite expensive for firms not only to purchase the actual hardware but to train their workers and ensure the presence of software licenses. Considering the problems mentioned earlier and further, few organizations are eager to spend their financial resources on the technology that brings not only advantages but also concerns (Kgobe & Ozor, 2021). Thus, purchasing RFID chips either leads to decreased margins or increased prices, and neither option is beneficial.
Further, an issue that is quite acute is related to the privacy and security of data and is more of a customer, not an industry concern. Kumar et al. (2009) indicate that many people are not pleased with the idea that personally identifiable information is stored, collected, and used by company workers who scan their purchases. What is more, a tag on a product can be read by any person with an RFID reader any time after the purchase has been made, and non-related people can receive this data.
Compatibility is the fifth issue related to the implementation of RFID technology in the retail industry. According to the researchers, “until uniform controls for production and manufacturing RFID tags are established, compliance will be an issue” (Kumar et al., 2009, p. 66). It is essential for the global economy to ensure that tags used by a certain company can be read by firms worldwide, but with a variety of scanner and tag formats, such a task seems challenging.
Eventually, it is important to mention that RFID technology users are also concerned with the need to upgrade the hardware. Since many firms expect the near future to offer them better and cheaper hardware, they are not interested in implementing this technological solution at the moment (Kumar et al., 2009). Evidently, this issue is directly related to all the previously mentioned barriers as it requires additional costs, including the need to train the staff to use the hardware correctly. Overall, these six issues make the use of RFID technology in the retail industry quite complex and even postponed, and specific solutions have to be offered.
Solutions to the Identified Challenges and Issues
Evidently, all the explored disadvantages prevent many firms in different industries from using RFID technology and enhancing their operations. Consequently, it is first necessary to introduce common global regulations and requirements for the production and use of RFID tags and readers so that there is more compatibility. When firms make sure that the implementation is standardized, more firms will want to risk and begin using this technological solution. Indeed, “with counterfeit protection and authentic confirmation, consumers can be assured that they are buying a legitimate brand or label” (Kumar et al., 2009, p. 67). As a result of the increasing demand, prices for RHID chips will drop, and manufacturers will strive to offer a better RFID system to stay competitive.
In general, the primary solution is to promote the identified technology better and to explain why it is more beneficial for firms in retail and other industries to adopt it. When they learn about the advantages offered, many organizations will recognize the potential behind RFID and spend their financial resources to begin using it. Secondly, it is also necessary to develop standardized employee training procedures and programs that will make it easier for companies implementing the technology to educate their workers (Kumar et al., 2009). Similarly, customers should also be educated about the benefits offered by RFID and potential measures that can help protect personal data stored in tags (Laboratory RFID, 2019). Furthermore, in relation to the inaccurately read data, manufacturers are required to make the scanners more sensitive, especially concerning tag parameter variations. Additionally, the anti-collision protocol should be in use by all systems.
A Real-World Industry and Company Benefitting from the Solutions
The solutions outlined above might be efficient for the manufacturers of RFID hardware and software in the first place. Evidently, the technological option is unique and practical, but specific issues that occur make it less effective. Therefore, it is recommended that manufacturers review the summarized concerns and apply the solutions to solve them. For instance, a new promotion campaign and a training tool for healthcare facilities utilizing RFID to help them educate their workers would contribute to enhancing the general situation with the use of RFID. What is more, if manufacturers unite to adhere to the same standards and strive to contribute to the unproblematic global use of RFID, other industries and organizations will be more motivated to adopt the technology.
Eventually, numerous individual companies can benefit from the proposed solutions, and FEIG Electronics is one of them. According to an online resource, this company manufactures RFID hardware and software and also educates its customers about using this technology (FEIG Electronics, 2020). As a consequence, this firm will not only manage to have more clients motivated and eager to begin using RFIDD but also update its training programs so that they refer to the issues outlined above. To be more precise, if the solutions are implemented successfully, the number of organizations utilizing this technology will grow. Further, as it has more customers, FEIG Electronics can meet its expectations by sincerely listing all the troubles they might face, indicating low risk, and offering prevention measures or ways to address the concerns.
Conclusion
To conclude, although RFID technology has high potential, there are still numerous challenges and concerns associated with its use. Thus, in the article by Kumar et al. (2009), problems such as privacy, reliability, cost, compliance, compatibility, and hardware updates are explored. Noticeably, all these barriers are interrelated, and it is essential to address them using a comprehensive approach. At the same time, eliminating one of them can significantly contribute to solving other listed issues. Solutions to these issues include establishing common global regulations, promoting the identified technology, developing standardized employee training, and updating the scanners’ capacity. These solutions are expected to benefit the industry of RFID manufacturers and FEIG Electronics in particular.
References
FEIG Electronics. (2020). RFID training: Keeping up with technology. RFID Reader News. Web.
Fescioglu-Unver, N., Choi, S. H., Sheen, D., & Kumara, S. (2015). RFID in production and service systems: Technology, applications and issues. Information Systems Frontiers, 17, 1369-1380. Web.
Kgobe, P., & Ozor, P. (2021). Integration of radio frequency identification technology in supply chain management: A critical review. Operations and Supply Chain Management: An International Journal, 14(3), 289-300. Web.
Kumar, S., Anselmo, M. J., & Berndt, K. J. (2009). Transforming the retail industry: Potential and challenges with RFID technology. Transportation Journal, 48(4), pp. 61-71. Web.
Laboratory RFID. (2019). 8 ways to protect your RFID data from security threats. Computype. Web.