Accurate data: The use of RFID helps in maintaining up-to-date data regarding various products, spare parts, and processes. Highly accurate data is available as and when required. RFID enables one to obtain the necessary data about a person, product or asset, as and when required.

Efficient decision making: A study of the processes of production and the pattern of sales can be done using the data collected by employing RFID. Unnecessary processes can be identified and eliminated. If any process is taking more time than it should, the reasons behind it can be determined and problems, if any, can be eliminated. Similarly, if the demand for any product is very less, a decision might be taken not to stock it at all or to stock it in a lesser quantity. Hence, RFID is also helpful in making efficient decisions, ultimately saving cost and increasing the profitability of the organization.

Ease in inventory control: Inventory control being a time-consuming and laborious process, it is usually undertaken once or twice a year. As a result, up-to-date information cannot be maintained. The adoption of RFID helps in solving this problem. Up-to-date, reliable and complete data can be maintained using RFID, which makes the process of inventory control simpler and more effective. Accurate data about all the material that comes into a warehouse and goes out of is available through the use of RFID. Similar is the case with a retail outlet. Hence, stock can be replenished as soon as it is exhausted. Out-of-stock situations can be reduced, thereby increasing customer satisfaction and trust on the outlet.

Similarly, keeping track of capital assets also becomes simpler, and their management also becomes easier and more effective.

Reduction in supply chain errors: RFID can be used to track the movement of the goods that go out of warehouses. In this case, as soon as a certain goods item goes astray on the way from the warehouse to the place of production, information about the same can immediately be obtained at the point of control. Wastage and theft can thus be minimized, and the possibility of errors in the supply chain can be brought down drastically. This, in turn, would lead to timely completion of the production process and savings in cost.

Lesser human intervention: When RFID is incorporated in an organization, the necessary data can be collected as and when required using a reader. The number of people required for locating lost goods, for finding a certain product, as well as in inventory control and management can be reduced. RFID leads to lesser requirement of human intervention, which, in turn, leads to considerable savings in manpower costs.

Efficient quality control: RFID helps in obtaining data about the exact time when each component of the process of production passed on to the next stage. In case of any defect in a certain batch at a later stage, it would be possible to trace it back to a particular worker or group of workers. Quality control thus becomes more efficient.

Similarly, good work done can also be traced back to the concerned worker or group of workers. They can be rewarded accordingly. This would, in turn, boost the morale of the workers.

The process of implementation of RFID in an organization typically consists of five major steps:

Observation of the market: Usually, an organization undertakes a study of the various types of technology available in the market. It studies the solutions adopted by other firms and the benefits obtained by them. A comparative analysis of the solutions adopted by different firms, their costs, reliability, benefits, etc. is undertaken. If necessary, the help of business analysts might be enlisted.

 Usually, it is the task of the top management to study the various kinds of technology available in the market, their benefits, costs, etc.

Business-level study: After studying the various solution options available, the firm analyses them in accordance with its own situation. The costs and benefits that each solution would provide to the organization are studied, and ultimately, a certain solution is selected.

The costs of an RFID application typically include the costs of tags and readers, the cost of integration of the same in the organization and training. The benefits include savings in cost on account of reduced wastage and improved efficiency, as well as an improvement in profitability. Apart from this, there are intangible benefits such as improved motivation of the workers, morale boosting, rise in the organizational goodwill, etc. All of these benefits should be taken into consideration when a business-level study is undertaken.

Making a business-level study is usually the responsibility of the Chief Executive Officer (CEO). The other officials who are sometimes engaged in this activity are the Chief Operating Officer (COO), the Logistics Manager, the Chief Technology Officer (CTO) or IT Manager, as well as the Chief Financial Officer (CFO).

Pilot Project: Usually, after a particular solution is selected, organizations undertake testing of the same in a simulated environment. This test usually lasts for a period of about a month, and it gives a fair idea of the usefulness and reliability of the solution to the organization. It is generally the CEO who discusses the business-level study with the top management, and helps in making the decision as to whether it would be beneficial to undertake a pilot project or not.

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