Radio frequency identification (RFID) at SMG Manufacturing, Inc.

Abstract

RFID is a generic term for technologies that use radio waves to automatically identify individual items. There are several methods of identifying objects using RFID, but the most common is to store a serial number that identifies a product, and perhaps other information, on a microchip that is attached to an antenna, the chip and the antenna together are called an RFID transponder or a RFID tag. The antenna enables the chip to transmit the identification information to a reader. The reader converts the radio waves returned from the RFID tag into a form that can then be passed on to computers that can make use of it (Auto-ID Center 2001). RFID systems can be used just about anywhere, from clothing tags to missiles to pet tags to food -- anywhere that a unique identification system is needed. The tag can carry information as simple as a pet owners name and address or the cleaning instruction on a sweater to as complex as instructions on how to assemble a car (Webopedia). The focal point of this qualitative research is to examine how RFID will impact SMG Manufacturing, a division of a multinational company, focusing on the implementation of RFID, exploring how this technology can benefit SMG Manufacturing within their supply chain and developing an understanding of the Wal-Mart initiative, the Wal-Mart initiative has the top 100 suppliers using RFID tags by 2005 and all other vendors using RFID tags by 2006. Although, very few companies are in full production with RFID between consumer goods manufacturers, retailers and grocery chains, there is a major thrust to move this technology to the forefront. Based on the review and inquiry of the data in this research study, five separate conclusions can be made. First, the Wal-Mart proposal will affect SMG Manufacturing in 2005 and concluding in mid to late 2006. Second, SMG Manufacturing must develop an implementation plan, which eliminates inefficiencies and expenses. Third, determining the best cost to performance balance will be part of the focus of the RFID team. Fourth, top management must be involved in the RFID deployment. Fifth, developing other RFID applications such as asset visibility, internal inventory control, labor reduction and maintenance parts tracking can help SMG Manufacturing realize benefits internally. In general, SMG Manufacturing is on the correct path in terms of accepting RFID as a technology. SMG Manufacturing still needs to make sure they develop a business plan, which includes RFID as a strategic approach to developing a solution for both the Wal-Mart initiative and within SMG Manufacturing.