Impact of Radio Frequency Identification Technology

The Environment consist of the all elements that are outside the system under consideration, and which it must take as given .The environment also include all the external impositions and constraints other than those imposed by the ownership.

The External environment cannot be ignored otherwise they will cause messy in the information System, in soft engineering mode of enquiry it emphasize a process of enquiry without forgetting external environment factors

The success of an organisation introducing RFID technology into its business depends strongly on a proper analysis of the environment it is operating in, a careful analysis of the environment should be carried out.

Economic impacts

In the retail Industry and manufacturing sector it is difficult to imagine a time when items flowing through a warehouse or distribution center were not automatically sorted using bar code labels. It is possible, however, to imagine how that process could be improved with RFID tags. In this application, RFID tags make a good process better (with the economic impact depending on how "good" the performance of the current bar code system is):

Beyond pure cost reduction, RFID-enabled sorting supports supply chain processes that are currently difficult or impossible with bar code technology. Higher data capacity in RFID tags allows more detailed and flexible sorting. Sophisticated customers sometimes specify detailed palletizing criteria for each order to facilitate cross-docking at their distribution centers. An order encompassing one pallet of facial tissue, another of bathroom tissue, and one of paper towels might require reconfiguration so that the customer receives three pallets, each with a mix of products and each destined for a different store. Data on an RFID tag could include not only to which outbound dock a pallet of towels should be transported, but also how it should be stacked before delivery. It is even conceivable to embed in a pallet tag the destination, contents, and stacking configuration of the pallet for use by the customer. If store conditions change between the time an order is shipped and when it is received, the customer could write different destination information into the pallet tag, or use the stacking information to automatically break and repack the pallet.

Hewlett Packard (HP) was an early adopter of RFID technology and has used the technology to gain supply chain efficiencies. He said that HP began RFID testing in 2002 and has been tagging pallets and cases in response to the Wal-Mart mandate. RFID benefits that have since accrued to HP include the elimination of manual processes for inventory control, decreasing inventory control time, and realization of downstream benefits in areas such as product returns and retirement.

There are also negative impacts, example the issue of Job cuts. If chain stores started to invest in this technology to process purchases, sidelining human check-out operators, then those employees may find themselves out of jobs, and this will have a negative impact towards economy as many people will be unemployed.

Global impact

Now that global standards are emerging in the design and implementation of RFID, businesses that implement RFID will find their products more acceptable globally and supply chain of their products will expand

Social Impacts

Any new technology has social consequences. These are usually seen as side-effects to the actual goals of the technology, and may not be visible for many years after the deployment of the technology. When the social impact of the technology is recognized late in the life-cycle of the technology, it is difficult and costly to make the changes that will mitigate these negative effects. It is therefore preferable to anticipate the social impacts and build safeguards into products early in the development thus saving money and development time.

A primary social concern regarding the use of RFID technology is that of privacy. As RFID tags are added to consumer goods or to items that will be associated with individuals such as identify cards or records, RFID has the potential to allow the tracking of the location and activity of individuals, and the creation of records of this tracking in databases, all without the individual's knowledge.

The scary part of the use of RFID tag is that products bought with an RFID tag on it could all be traced specifically to the buyer just with the help of the tiny chip inside. Many people are already thinking this could potentially become a