Radio Frequency Identification (RFID) technology Essay

Radio Frequency Identification (RFID) technology - Essay Example Understanding the RFID devices and how they work is critical for analyzing privacy issues that surround this technology. The main components of an RFID system are a chip/tag, reader, and database. A reader scans the tag for data and sends the information to a database, which stores the data contained on the tag (Federal Trade Commission 1-54). In the last several years this technology has gained popularity as a way to streamline different supply chain processes in various settings such as distribution centers, retail stores, hospitals and pharmacies (Davis n.pag [a]). RFID equipment vendors have been confident on the technologys adoption, but the consumers are worried that RFID technology can bring in unknown risks and is not cost-effective enough to be installed in a supply chain network. In reality RFID tags can be read much faster than bar codes indicating that RFID’s scanning capability can result in goods moving through the supply chain much faster than they do when bar codes are used. RFID facilitate quicker, more accurate recalls by enabling the tracking of a product’s origin and its location in the distribution chain. According to a survey conducted by the Computing Technology Industry Association (CompTIA), it was found that IT resellers and vendors are all set to add RFID solutions to their portfolios. However, the major problem is from their customers who are reluctant and are slow to embrace the technology. According to the survey, 84% of resellers, solution providers, systems integrators, and consultants are prepared to offer RFID products and solutions in the next three years. About 65.6% of them said their customers are yet to implement RFID solutions. This survey also pointed out that the adoption of this technology has been challenged by equipment and tagging costs, murky and unclear return-on-investment for supply chain applications, and a workforce skills shortage. Though the