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Benefits of Using Radio Frequency Identification Technology


RFID technology is often regarded as a successor of the technology that has dominated for decades. Bar codes have been in place since the second part of the 20th a century and are now used in all the spheres where inventory management is relevant (Smith-Ditizio & Smith, 2017). The method enables people to trace the flow of items with a significant degree of accuracy, which made the technology popular worldwide. Barcoding involves the use of the codes usually typed on packages or even items, and readers (Lee, Choi, & Lee, 2017). RFID technology was introduced later, but it soon became widely used as well (Bibi, Guillaume, Gontard, & Sorli, 2017). This method implies the use of tags and a reader. Both technologies have certain advantages and disadvantages, which makes it difficult for users to choose between the two options. However, the use of RFID is often regarded as more efficient and cost-effective due to various features of the technology (Lui, Ngai, & Lo, 2016). This paper includes a brief discussion of the statement of the problem and research questions.

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Purpose of the Study

As has been mentioned above, both technologies are now used widely, but people are still reluctant to switch to a more recent method. One of the major barriers to the successful implementation of RFID technology is associated with an investment as this technology requires more funds than the bar code method (Bibi et al., 2017). One of the benefits of bar codes is their universality as the vast majority of retailers and manufacturers have adopted this technology. However, to assess the effectiveness and benefits of the technologies under analysis, it is critical to identify the most relevant criteria. The purpose of this study is to identify the benefits of using RFID technology as compared to bar code technology.

Statement of Problem

The major focus of the involved stakeholders is the cost-effectiveness of the two methods. When it comes to changes, the major question that arises is associated with the relevance of the change and its financial justification. People have been using bar codes that have proved to be effective for decades, so many stakeholders do not think the change is necessary (Smith-Ditizio & Smith, 2017). Furthermore, many managers cannot tolerate the costs that are necessary for the use of RFID technology. Nevertheless, many practitioners and researchers provide evidence showing the benefits of RFID technology (Bibi et al., 2017; Uy, Kury, & Fontelo, 2015). More information is necessary and more case of the use of RFID should be explored.

Another relevant aspect is accuracy as manufacturers and retailers need to make sure that their inventory can be traced easily and accurately (Smith-Ditizio & Smith, 2017). Both technologies can ensure a high level of accuracy as each item receives a specific code. However, accuracy can be undermined if the codes cannot be processed. For example, bar codes can often be damaged easily, which can have considerable adverse effects on the flow of items. RFID tags have certain protection that makes codes more secure. Therefore, the usability of the technologies seems to be a more relevant aspect to analyze. Besides, stakeholders often need to process large amounts of items. RFID technology has an advantage as the reader can process many tags simultaneously covering significant areas (Bibi et al., 2017). Bar code readers are confined to the so-called line of sight and can process one code at a time.

Another criterion to consider is the information encoded. The stakeholders now need to take into account various features of the product. For instance, in the food industry, in addition to the country of origin and the title of the item, it is often desirable to have some information as to the optimal temperature, shelf life, and so forth (Bibi et al., 2017). Bar codes also seem quite basic in the sphere of healthcare where many features of items could be revealed. Uy et al. (2015) claim that the use of RFID technology minimizes the number of medical errors in the area of blood transfusion. It is also mentioned that patient outcomes are often improved in other health-related situations due to the use of RFID. Moreover, the increasing use of advanced technologies including the Internet creates an urge for more informative tools. Madakam, Ramaswamy, and Tripathi (2015) note that RFID is becoming more popular due to its potential applicability in the domain of the Internet of Things. At that, the availability of more data can be valuable in various spheres.

Research Questions

Based on the brief analysis above, it is possible to formulate the research questions.

  1. Is RFID more cost-effective than bar code technology? Why?
  2. What kind of information encoded is needed in inventory management?
  3. What are the most convenient and valuable features associated with using bar codes?
  4. What inconveniences can be encountered when using bar codes?
  5. What are the most convenient and valuable features associated with the use of RFID technology?
  6. What inconveniences can be encountered when using RFID technology?


Bibi, F., Guillaume, C., Gontard, N., & Sorli, B. (2017). A review: RFID technology having sensing aptitudes for the food industry and their contribution to tracking and monitoring of food products. Trends in Food Science & Technology, 62, 91-103.

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Lee, W., Choi, J., & Lee, D. (2017). Comparative performance analysis of antocollision protocols in RFID networks. In S. A. Ahson & M. Ilyas (Eds.), RFID handbook: Applications, technology, security, and privacy (pp. 161-180). Boca Raton, FL: CRC Press.

Lui, A., Ngai, E., & Lo, C. (2016). Disruptive information technology innovations and the cost of equity capital: The moderating effect of CEO incentives and institutional pressures. Information & Management, 53(3), 345-354.

Madakam, S., Ramaswamy, R., & Tripathi, S. (2015). Internet of Things (IoT): A literature review. Journal of Computer and Communications, 3(5), 164-173.

Smith-Ditizio, A. A., & Smith, A. D. (2017). Barcodes vs. RFID and its continued success in manufacturing and services. In M. Khosrow-Pour (Ed.), Encyclopedia of Information Science and Technology (pp. 5273-5284). Hershey, PA: IGI Global.

Uy, R. C. Y., Kury, F. P., & Fontelo, P. A. (2015). The state and trends of barcode, RFID, biometric and pharmacy automation technologies in US hospitals. AMIA Annual Symposium Proceedings Archive, 2015, 1245-1251. Web.

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