RFID, Warmed Over

According to a popular myth circulating on the Internet, the new U.S. $20 bill contains a hidden RFID chip that will explode if the bill is microwaved.

Leaving aside the question of why anyone would microwave a $20 bill, the point of this rambling, incoherent rant (you can read it at http://www.prisonplanet.com/022904rfidtagsexplode.html) by cyber vigilantes “Dave and Denise” seems to be that the government can somehow use RFID to track our cash, intending, of course, to take it away from us. Dave and Denise plan to wrap their larger bills in foil from now on.

We may not have descended to this level yet, but how many of us have overreacted to the RFID dictates from Wal-Mart, the U.S. Department of Defense, and other organizational heavyweights? In much the same way as they did during the Y2K hysteria, operations executives are rushing to retrofit their warehouses and revamp processes that have served them well for decades. But the bottom line is that you may have to change much less than you think. Experts suggest some things you should do — and do without:

Don’t panic. The RFID community may be “pushing an emerging technology that remains clouded by challenges,” according to Venture Development Corp. analyst Michael J. Liard. With most major firms’ deadline for RFID tagging only eight months away, it is unlikely that major problems with the technology will have been resolved by then.

Understand just what compliance means. Liard says this involves asking which suppliers are affected, what penalties will result if you don’t comply, and whether system requirements will vary among suppliers and clients.

Move forward with some aspects of RFID; put others on hold. AMR Research Inc. suggests upgrading your current infrastructure now so that it can read the information on electronic product codes.

Explore other uses of RFID, recommend analysts at Forrester Research Inc. You may be able to justify its steep cost if you make the technology work for you in ways that go beyond compliance. For example, says Forrester, using RFID to complement extended-Internet technologies like Bluetooth and GPS can boost supply chain visibility.

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