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TECHNOLOGY IN BUSINESS

Advantages, Disadvantages and Implementation

of RFID and GPS in Business

NAME: DOAN THAI BAO NGOC (GEM)

CLASS: DIP BA/INTAKE 13TH

SUBJECT: BUSINESS INFORMATION SYSTEM

LECTURER: MR. SHIREESH KUMAR

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For business environment, high technologic products are the most powerful weapon to obtain

advantages for organizations. The management of an organization requires a huge number of

tasks performing different roles. In the past, all the tasks are mostly performed by human being,

so it takes a lot of time and money. With technology that is up-to-date days by days, there are

many high technologic products that become important for organization. High technology helps

organization perform the jobs so much better due to its advantages. That is why businesses now

depends much on technology and sees it as a vital role. Two most popular products of high

technology that can show how it impacts on organization in business are Radio Frequency

Identification (RFID) and Global Positioning System (GPS).

RFID is the system that was developed by the demand of making the process of marking and

recognizing objects more easily in 1980s of manufacturing environment, especially objects of

inventory. This product improves the business process of organizations in inventory

management. In business, the objects tagged on to be identified by RFID system are usually

store merchandise, postal packages and living organism.

(Citation http://electronics.howstuffworks.com/gadgets/high-tech-gadgets/rfid.htm, retrieved on

4th Jan 2010)

RFID which is in the shape ofsupper-tiny piece of hardware is also called smart label or RFID

chips. People tag bar codes using RFID chips on the products. Also, the code has network

connection with whole computing system, so all the information of products is saved in the

computer system and match with information on the chips . (Turban et al 2006, pg. 303) Then, a

reader is employed to provide radio signals to the chips. Consequently, the chip on a particular

object will respond and the information needed to know is recognized easily. There are two

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types of RFID chips, namely passive and active.Passive RFID must have the readers signal to

create power for itself. In contrast, active RFID has power itselfand does not have to be near to

the signal from the reader, it still can do the process of transmitting and responding of

information.

(Citation http://www.rfidc.com/docs/introductiontorfid.htm, retrieved on 4th Jan 2010)

Nowadays, it becomes part of our life as the manufacturers, retailers and wholesalers employ this

technology to track of their products. This is the result of many purposes and demanding creating

in order to solve the problems in business.

First purpose of RFID is to increase productivity and cut cost. RFID helps people perform fewer

jobs, so people can focus on other more important tasks and the entire process is done more

effectively (OBrien and Marakas 2007, pg. 103). For instance, building inventories in supply

chain is a big problem as it is difficult to know exactly how the conditions of each product are.

When the value of merchandise is too high, the cost of keeping them is also very high. On the

other hand, the value of merchandise is too low but there is not any insurance for the situations

out of stock of products. This leads to losses in profit. From that point, the cost of managing

and keeping inventories is very high, so the companies always choose RFID as the best decision

to control inventories. It is because the time and the cost to recognize the objects is less than

other solutions. This results in more productivity. (Citation

http://www.rfidc.com/docs/introductiontorfid.htm, retrieved on 4th Jan 2010). The second

purpose is to reduce number of times doing a particular task. Trying to imagine what if the tasks

of tracking and identifying items were done by human being. It is sure that there would be many

mistakes created and then people have to do the whole process again and again. This leads to the

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result why people use RFID. It is obvious that if that task is done by RFID, there will be less

error, so that there will be fewer situations that the task is redone. (Citation

http://www.rfidc.com/docs/introductiontorfid.htm, retrieved on 4th Jan 2010). Another purpose of

RFID is to obtain better security and services. An example of this is in banking, RFID is used to

manage users account. Much information including monthly bill account, banking statements of

users and the fraud avoidance are all organized by RFID. In these situations, RFID tag line of

number on the ATM or credit card of the customer. That number presents as an account number

and is read by any ATM that is located on the street sides, in the malls and in the banks. The

bank can recognize all the users activities such as where, how and when the user withdraws or

deposits the money as the codes on the cards and the ATM have has large network connection

with banks computer system. Then, the bank can determine immediately if there are cases of

fraud or thief, so that the customers have more confidence in the bank. Therefore, RFID helps

the banks gain better security and customer services. The last purpose need to be mentioned here

is to make better decision in management. An illustration for this is the system of MRT stations

or bus in Singapore. They are both public transports and used by a lot of people, so the tasks

such as ticket services, payment or controlling the trains and busses journey. The solution for

these problems is RFID. How the RFID technology is used here is the EZ-link card containing a

line of number that has network connection with major computing system of transports service.

When the customers tab their EZ-link cards at the entrance of MRT or bus, it will be recorded in

the computing system and the account in the card will be deducted automatically. Therefore, the

managers can get interesting information saved in the database of MRT system. The managers

know which time the customers use the service most or lest, so that they can make the best

decisions of providing more or less bus and reducing or increasing the time between stations

coming and going.

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RFID technology is implemented by organizations in many aspects, including logistic-tracking,

asset tracking, personal identification, payment systems, business processes and healthcare.

(Citation http://www.rfidc.com/docs/introductiontorfid.htm, retrieved on 4th Jan 2010)

An example for logistic and tracking is the Gulf States Toyota company. The organization

chooses active RFID tracking system for processing vehicles annually instead of the traditional

way which was to send employees doing the process directly determine a particular car for a

particular buyers demand. This decision helps Toyota company reduce the labor cost and obtain

better quality of customer service and tracking system. (Citation

http://www.rfidjournalevents.com/live2006/transportation_logistics.php, retrieved on 5th

Jan

2010). On the other hand, Wal-Mart also begins to implement RFID technology on products and

packaging in 2004. For business process, International Paper Company is a good illustration. The

company agreed to employ RFID supply chain solution in 2004 . It helped the company improve

the processes of workflow- management gain the first rank in its industry for many years .

(Citation http://www.rfidjournalevents.com/live2006/transportation_logistics.php, retrieved on

5th Jan 2010) (Myerson 2007, pg.23). Another implementation of RFID is electronic passport (e-

passport) which is seen as personal identification. United Kingdom is one of first countries begin

using this technology in reality in 2007. E-passport contains RFID chip including a biometric

facial image that can be scanned to identify personal information. (Citation

http://news.cnet.com/U.K.-e-passports-start-their-travels/2100-7348_3-6041491.html?

tag=lia;rcol, retrieved on 6th Jan 2010). Furthermore, RFID is also implemented to determine ID

of students in university and colleges such as Kaplan Singapore. Each student studying at Kaplan

holds a student card using RFID technology to access the college and check attendance every

day. There are bars of reader located on wall put at several places in the school, so the students

can tab their cards on those bars. Last implementation of RFID is in healthcare. For instance,

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United State hospitals nowadays use RFID tag to determine the position of their patients.

Newborn babies are tagged RFID chips on to distinguish from each other and avoid the

situations of mistakes.

However, RFID is still a new technology which is developing, so there are some limitations to

use this technology. Firstly, launchingRFID technology is expensive, so it will be wasted if the

amount of data is not big. Secondly, there are some concerns about consumer fears using RFID.

For example, the customers holding responsibility for keeping a RFID chip in their passports, so

government and corporation know where they are, what they are doing and all other controlling

their behaviors. (Petkovic and Jonker 2007, pg.439) Lastly, the privacy seems the issue

concerned most. More data means more way of accidentally disclosing such information . The

information such as personnel, facility, hardware, software and documentation needs to be

protected as assets. Therefore, there are some risks losing assets then getting damages and loss of

productivity. (Sabri, Gupta and Beitler 2006, pg.133) (Miles, Sarma and William eds. 2008, pg.

22)

The second popular technology that is developing at the present is Global Positioning System

(GPS), which is navigation system providing position information, is available any moment and

anywhere on over the world. (Citation http://www.gps.gov/applications/timing/index.html,

retrieved on 7th Jan 2010). It has major effect on land, in the air and at sea. (Hofmann,

Lichtenberger and Collins 2001,pg. 319). This is a user-friendly equipment as all the users have

to do is setting the exact date and time, then estimating the latitude and longitude that do not

need to be accurate. Then the GPS receiver will be in processes and display the position for the

users (Monahan and Douglass 2000, pg. 2). However, the GPS receiver is up-to-date and

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changing non-stop nowadays. Whole things the new GPS receiver wants the users to do is

providing information of their locations by state, country or regions (Monahan and Douglass

2000, pg. 3). Then there are processes of transmitting signal between GPS receiver and some

specific satellites. In the end, it provides its own present position to the users and helps them

know where they are.

The development of this technology is due to different purposes of people to seek solutions for

some problems. The most usual purpose is about navigation. GPS is used by both military and

civilian most as they want to know exactly partial positions. In the air, aircraft uses GPS for

journal of flights such as preparing for landing which requires high level of accurate

calculations (Monahan and Douglass 2000, pg. 1). On the land, any types of users can use GPS

as equipment identifying or seeking a position so that they never get lost. At the present, GPS is

more modern as it can enter the water environment. This makes GPS become a relevant

invention for the users who lost at sea, especially on boating. Another purpose of people using

GPS is surveying. Besides providing position information, this technology also can do for people

the calculation of natural changes of geography such as crustal deformations, volcanic uplift,

earth rotation and so on (Hofmann, Lichtenberger and Collins 2001,pg. 321). Then, scientists

can predict the problems, preventing and making solutions on time. The last purpose of using

GPS is timing and communications. People, especially scientists, always need to identify exact

time to monitor global geophysical measurements and GPS is the best solution (Hofmann,

Lichtenberger and Collins 2001, pg. 320). GPS can give users an accurate time with several

techniques supporting. In business, GPS is used for tracking. GPS also can plan the business trip

for trucks. The companies choose GPS to collect their location information and send the

information to a core-location, so that they can reduce time and cost of trucking for thousand of

labor. (Citation http://www.delorme.com/business/default.aspx, retrieved on 7th Jan 2010). Also,

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with GPS the companies can manage asset better because GPS can determine where the

companies assets tracking. For the people working in marketing and sale, they often have to go

travel abroad. Therefore, they do not need to waste time and money on the street by using GPS

navigation. (Citation http://www.delorme.com/business/default.aspx, retrieved on 7th Jan 2010).

GPS system in transports such as cars and trucks helps employees of the organization save time

when they have to delivery products to a particular location. This is due to automatic setting of

journal by GPS tracking. GPS is also employed in the industry of security. For example, GPS

tracking vehicle helps polices determine the position of the cars stolen.

There are some implementations of GPS which is used in reality. One of these is hand-held GPS

which runs on batteries. It can fit in a shirt pocket. It has ability to display position, course,

speed, possible time and more complex functions. It is also waterproof so that it can be used on

boating and many other places at the sea. (Monahan and Douglass 2000, pg. 9) One more

advantage of this application is low-cost. This equipment can be used by any type of users,

including group of people and individuals. Next implementation is dominant navigation system

on land, in the air and at the sea. The major organization implements this is Federal Aviation

Administration (FAA) launched the system of GPS for the US airspace in 1994 to control

approaching and landing. Another implementation isJapanese, uses GPS for stations to provide

and monitor near real-time. For surveying, some North Sea oil platforms in the US use GPS to

survey the changes in heights and some more calculations to understand the trend monthly.

(Monahan and Douglass 2000, pg. 11)

Same as RFID, GPS also have limitations as it is still a new technology and need to be improved.

There are three limitations which are poor GPS signal reception, loss of GPS signal integrity

and limited positioning accuracy. GPS cannot be used at several places such as marine

navigation and undergroundas there is limited signal. Mining and surveying undergroundare

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the examples. Moreover, if there are situations that wrong satellites or measuring positioning, the

user will get wrong receiver position. Then the users do not know and correct the wrong signal,

they also do not know that they got wrong position displaying. Therefore, the issue of GPS

signals integrity is a big problem. Lastly, for any measuring equipments, there is always a

limitation for accuracy and this also happens to GPS. There are different errors creating while

GPS is transmitting signals with satellites and this is because of various reasons such as about

satellite errors or receiver errors. (Citation http://articles.techrepublic.com.com/5100-10878_11-

5034522.html, retrieved on 7th Jan 2010.)

In conclusion, by understanding two high technologies which are RFID and GPS, it proves that

technology is vital to business due to advantages about competitions, productivity and saving

costs. Both technologies solve many problems for business and are implemented in reality by

many organizations over the world. However, they are still need to be improved and developed

better because of some limitations.

Reference

Citation http://electronics.howstuffworks.com/gadgets/high-tech-gadgets/rfid.htm, retrieved on

4th Jan 2010

Citation http://www.rfidc.com/docs/introductiontorfid.htm, retrieved on 4th Jan 2010

Citation http://www.rfidjournalevents.com/live2006/transportation_logistics.php, 5th Jan 2010

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Citation http://news.cnet.com/U.K.-e-passports-start-their-travels/2100-7348_3-6041491.html?

tag=lia;rcol, retrieved on 6th Jan 2010

Citation http://www.tutorial-reports.com/wireless/rfid/walmart/tag-advantages.php, retrieved on

6th Jan 2010

Petkovic and Jonker 2007: Security, Privacy and Trust in Modern Data Management. Berlin

Heidelberg: Springer.

Sabri, Gupta and Beitler 2006: Purchase order management best practice: process, technology,and change management. USA: J. Ross Publishing.

Turban et al 2006: Information technology for Management: transforming organizations in the

digital economy, 5th edition. Asia: John Wiley and Son, Inc.

OBrien and Marakas 2007: Enterprise Information System, 13th Edition. New York: McGraw-

Hill Irwin.

Miles, Sarma and William eds. 2008: RFID Technology and Applications. Massachusetts:

Cambridge University Press.

Myerson 2007: RFID in the supply chain: A guide to selection and implementation. New York:

Auerbach Publications Taylor and Franas.

Citation http://www.gps.gov/applications/timing/index.html, retrieved on 7th Jan 2010

Citation http://www.delorme.com/business/default.aspx, retrieved on 7th Jan 2010.

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Citation http://articles.techrepublic.com.com/5100-10878_11-5034522.html, retrieved on 7th Jan

2010.

Hofmann, Lichtenberger and Collins 2001: GPS: theory and practice, 5th edition. New York:

Springer Wien.

Monahan and Douglass 2000: GPS: instant navigation from basic techniques to electronic

charting, 2nd Edition. Canada: Fine Edge Production.

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