RFID Adoption in China: Current Applications and Future Developments, Study Guides, Projects, Research of Production and Operations Management

Download RFID Adoption in China: Current Applications and Future Developments and more Study Guides, Projects, Research Production and Operations Management in PDF only on Docsity! 0 China is Taking Positive Steps to Embrace RFID A Review Paper in RFID Submitted to Dr. Rob Clarke Michigan State University School of Packaging Submitted by Li Xiong Michigan State University School of Packaging As a Partial Fulfillment Of the Requirements For PKG 491 Dec. 2004 1 Table of Content Executive summary Introduction Current RFID applications in China Next-generation applications of RFID in China Steps taken by China to speed up RFID applications in China Voice from China’s RFID community Summary Relevance to RFID Course PKG491 References 4 S The combination of newest technology with the historic tour site of thousands of years old showcased the world that China is not afraid of changing for good. Moreover, it was reported that China is seriously considering using RFID in transport applications, ticketing applications, security applications, banking, e- government, and media in the 2008 Olympic games hosted in Beijing [4]. Next-generation Applications of RFID in China o far, the major in-place applications of RFID in China have been focused on toll-collection, public transport and building security cards [5]. However, the more important applications of RFID will reside in the manufacturing sector and its potential role in the worldwide supply chain. Everybody is talking about the deadline set by Wal-Mart to its top 100 suppliers to tag pallets and cases shipped to its distribution center by January 2005. It must be mentioned that between 50% and 70% of nonfood products sold in Wal- Mart are manufactured nowadays in China [6, 7], which accounts for around 10% of China’s yearly export [5, 8]. The utilization of RFID in supply chain can give Wal-Mart alone up to $8.35 billion in total pre-tax savings, estimated by Sanford C. Bernstein & Co. [9]. The direct interpretation of the fact is China is manufacturing a large portion of products for most of the Fortune 500, and most of those products are shipped overseas to the biggest retailers in the world including Wal-Mart. Companies who have manufacturing plants in China can choose to tag their pallets and cases after their packages arrives their distribution centers in the US and before they ship them again to the distribution centers of retailers such as Wal-Mart. Or they can choose to start tagging their products at their manufacturing sites to start tracking their products from the most beginning of the distributional channel 5 C and to reduce the cost due to extra inventory maintenance time. As a matter of fact, “many U.S. manufactures are in the process of installing RFID-tagging systems at Chinese manufacturing centers to better track products from their point of origin”, one of which was Hewlett-Packard, who applied for a temporary license to test RFID at their manufacturing plants in China [10, 11]. One bicycle supplier to Wal-Mart, Pacific Cycle, also claimed that by tagging their products at its manufacturing sites in China instead of in the US would improve its supply chain by reducing up to 1.5 hours of labor time to prepare each truckload shipment [6]. Having the same hope as Wal-Mart, suppliers are as well hoping to bring RFID to their business advantages by streamlining their own supply chain and by saving costs. It is obvious that there is the driving force for the tagging products at point of origin to happen. However, there are certain hurdles to doing so, one of which is the lack of RFID standards and open frequency bands to RFID data transmission in China. Steps Taken by China to Speed Up RFID Applications in China hina has realized the problem and is working to solve it to speed up the deployment of RFID in the country. In November 2003, China formed the National RFID Tag Standards Working Group to establish its national RFID tag standards [12, 13, 14]. So far, the Working Group has not disclosed much information about its progress in setting the Chinese RFID standards. However, it was reported that China’s national RFID standards would include [12]: 6 • “ISO/IEC15693; • Identification Card/non-contact IC card/protocol card first part: physical specifications-Item number 20030175-T-339; • Identification Card/non-contact IC card/protocol card second part: input/output port and initialization-Item number 20030176-T-339; • Identification Card/non-contact IC card/protocol card third part: anti- interference and transporting agreement-Item number 20030177-T-339; • Application rule first part: electronic label-Item number 20030444-T-443; • Application rule second part: reading terminal-Item number 20030444-T- 444.” In terms of frequency band used for passive RFID transmission, the US currently uses 902-928 MHz spectrum. Europe is finalizing its plan to use 865.6-867.6 MHz. In Asia, Korea has finalized its regulation to use 908.5-914 MHz and Japan is in the process of regulation to use 950-956 MHz [15]. ISO/IEC 18000-6 (860-960 MHz) is reopened to address new developments such as Gen2 [15]. China’s State Regulatory Radio Commission (SRRC) was reported to plan to open UHF 868 MHz for passive RFID transmission in August 2004, but that has not happened yet [6]. In early June 2004, China’s SRRC announced its support for devices operating at 434 MHz for active RFID transmission. The counterpart of governmental regulatory body in the US, FCC, made the same announcement in April [17]. There are two widely used coding schemes currently. One is UID coding scheme of UID center of Japan, which is supported by Japanese electronics manufacturers, media companies, and publication companies. The other is EPC coding scheme of EPC Global, a joint venture of Uniform Code Council (UCC) and the European-based EAN International [16]. The EPC codes are supported technically by big names as IBM, Microsoft, and Auto-ID Lab, and deployed by 9 L On the other hand, the movement to reach a global RFID standard is crucial for its own development and future success. The world needs to include China in the process of setting global RFID standards and developing the global RFID market. Such cooperation will lead to a win-win outcome by revolutionizing the supply chain network around the world. Relevance to RFID Course PKG491 ittle was mentioned in PKG491 about the standardization of RFID technology around the world while it is an important issue for its success. In the meantime, China’s role in this process must be addressed due to its important status in the world economy. The intention of choosing the topic of my project is to explore the current applications of RFID in China, its technical development in China, and the China’s effort to participate in the global RFID market. 10 Reference: 1. China Boosts Border Crossing Efficiency and Security Using TransCore’s eGo Products; Deployment Highlights International Scope of Border Crossing Issues, http://www.rfidnews.org/news/2002/10/14/china-boosts-crossing- efficiency-and-security-using-transcores-ego-products-deployment-highlights- international-scope-of-border-crossing-issues. 2. Jonathan Collins, Smart Labels for Higher Education, http://www.rfidjournal.com/article/articleview/666/1/1/ 3. Inside Contactless, RF-ID Cards for 8 Million Students in China, http://www.rfidnews.org/weblog/2003/11/04/rfid-cards-for-8-million-students- in-china. 4. Great Wall of China Installs MIFARE Contactless Ticketing System, http://www.rfidnews.org/news/2004/09/06/great-wall-of-china-installs-mifare- contactless-ticketing-system. 5. Kien Leong, RFID in China: Leading the Way or Just Tagging Along? http://www.chinatechnews.com/index.php?action=show&type=news&id=771. 6. Laurie Sullivan, China is Settling RFID Issues, but Slowly, http://www.informationweek.com/story/showArticle.jhtml?articleID=22100908 7. China, Wal-Mart March to RFID, http://www.rfidnews.org/weblog/2004/06/21/china-walmart-march-to-rfid. 8. China and RFID, http://www.rfidnews.org/weblog/2004/02/19/china-and-rfid. 9. Julie Tam, Operation RFID 2005: Will China Make the Grade? http://www.chinatechnews/com/index.php?action=show&type=news&id=1549. 10. Claire Swedberg, China’s RFID Conundrum, http://www.rfidjournal.com/article/view/1089. 11. Laurie Sullivan, China RFID Standards are Eagerly Awaited by U.S. Manufacturers, http://www.informationweek.com/story/showArticle.jhtml?articleID=22101026. 12. China Establishes RFID Standards Body, http://www.rfidnews.org/weblog/2004/01/15/china-establishes-rfid-standards- body/ 11 13. China SAC Creates RFID Working Group, http://www.rfidnews.org/weblog/2004/02/09/china-sac-creates-rfid-working- group/ 14. China Gears Up for RFID, http://asia.cnet.com/news/systems/0,39037054,39167645,00.htm. 15. Standards: Harmonizing the Effort to a Global RFID Standards, http://www.shorecliffcommunications.com/data/presentations/rfidchina/7- HarmonPanel.ppt. 16. Are RFID Standards Immune to Economic Interests? http://weblog.infoworld.com/techwatch/archives/000714.html. 17. China and U.S. Drive Momentum for Active RFID Band, http://www.chinatechnews.com/index.php?action=show&type=news&id=1306. 18. China Feels Left Out, http://www.rfidnews.org/weblog/2004/09/17/china-feels- left-out. 19. Jonathan Collins, China Urges Role in EPC Standards, http://www.rfidjournal.com/article/articleview/1119/1/1. 20. Jim Carbone, China to Develop its Own RFID Standard, http://www.manufacturing.net/pur/article/CA438532.html?pubdate=7%2f23%2 F2004. 21. Korea, Japan and China Announce Working Group, http://www.rfidnews.org/weblog/2004/07/27/korea-japan-china-announce- working-group/.