| Written by Mark Buzinkay

Dive into the world of Automatic Identification and Data Capture (AIDC), the innovative technology suite revolutionising how we identify objects, collect data, and streamline operations across various industries. From the evolution of barcodes to the sophistication of RFID, biometrics, OCR, and NFC, AIDC technologies are at the forefront of reducing manual errors, enhancing efficiency, and improving productivity. Whether it's managing inventory, securing transactions, or tracking assets, AIDC systems offer unparalleled accuracy and convenience. Join us as we explore the core technologies, applications, and the transformative impact of AIDC on businesses and daily life. Embrace the future of digital data capture and analysis—read on to discover how AIDC is shaping the digital economy and driving innovation across the globe.
AIDC Automatic Identification and Data Capture

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AIDC Brief

Automatic Identification and Data Capture (AIDC) is a broad category of technologies used to automatically identify objects, collect data (from an individual, object, image or sound ), and enter that data directly into computer systems without human intervention. AIDC systems are designed to improve efficiency, accuracy, and productivity in various operations across industries by minimising manual data entry and errors. AIDC applications typically fall into a few categories: identification and validation at the source, tracking, and interfaces to other systems.

Definition of AIDC

AIDC encompasses a range of technologies used to identify items, collect data about them, and then aggregate that data into a database without manual data entry. AIDC systems are used to manage inventory, delivery, assets, security and documents. This includes barcode scanning, RFID (Radio-Frequency Identification), biometric recognition, optical character recognition (OCR), and near-field communication (NFC), among others. Additionally, AIDC devices are generally invented to be small in size, rugged, and easily mobile, to boost user convenience, and to resist severe conditions without compromising or corrupting their data.

Brief History of AIDC

The history of AIDC technologies dates back to the mid-20th century, with the development of the first barcode system in the 1940s and 1950s (Bernard Silver and N. Joe Woodland). Dr. David Sheppard developed the first practical optical character recognition (OCR) scanner in 1951. Within 20 years, over 50 companies and 100 different OCR readers entered this new market. Since then, AIDC technologies have evolved significantly, introducing more sophisticated systems like RFID in the 1970s, biometrics in the late 20th century, and the continuous advancement of OCR and NFC technologies (see below). Each evolution aimed to address specific identification and data capture challenges, leading to more efficient and accurate systems.


Importance of AIDC in Modern Business and Technology

In today's fast-paced and technology-driven world, AIDC is crucial in streamlining operations across various sectors, including retail, healthcare, logistics, manufacturing, and more. 

Most individuals use AIDC-enabled instruments daily, even without recognising them. For example, the magnetic strip and embedded chip on your credit cards are two examples of trusted automatic identification and data capture methods. Or anyone who has supplied a machine-readable lottery ticket obtained a package with a digitally printed label encountered automatic data capture tech tools!

Businesses can significantly reduce human errors, increase data accuracy, enhance productivity, and improve overall operational efficiency by automating the identification and data capture processes. AIDC technologies also enable better tracking and management of inventory, assets, and people, leading to improved decision-making and customer satisfaction.

AIDC systems have become indispensable in the modern digital economy, supporting the seamless flow of information within and across organisational boundaries. They facilitate real-time data collection and analysis, enabling businesses to respond more quickly to market changes, manage resources more effectively, and deliver enhanced customer service. In short, AIDC is most important because it saves a great amount of time when entering digital data and its accuracy, which ultimately results in reliability. 

As technology advances, the role of AIDC in driving innovation and efficiency in business processes and consumer interactions is expected to grow even further.


Core Technologies of AIDC

Now, let's explore the core technologies that constitute AIDC, detailing their mechanisms, applications, and unique advantages.

Barcode Systems

Barcodes are one of the most widely recognised forms of AIDC technology. Barcodes consist of small images of varying lines (bars) and spaces affixed to retail store items, ID cards and postal mail to identify a particular product number, person or location. These are scanned and interpreted by barcode readers to retrieve the encoded information. A barcode reader uses a laser beam sensitive to the reflections from the line and space thickness and variation. 

  • 1D and 2D Barcodes: 1D barcodes encode data in a linear format and are used extensively in retail for pricing and inventory. 2D barcodes store information not only horizontally, as one-dimensional barcodes do, but vertically as well, enabling them to store up to 7,089 characters. The traditional, unidimensional barcode has a 20-character capacity.
  • Barcode Scanners and Readers: Devices designed to read the information encoded in barcodes. They range from handheld scanners to stationary scanners and use laser or imaging technology to capture the barcode data.

RFID (Radio-Frequency Identification)

RFID uses electromagnetic fields to identify and track tags attached to objects automatically. The system has three components: an antenna, a transceiver (often combined into a single device), and a transponder (the tag). The antenna transmits a signal that activates the transponder, which then sends data back to the antenna. Because RFID does not need direct contact or line-of-sight scanning, RFID tags are replacing barcodes in many applications. The tags contain electronically stored information which can be read from up to several meters away and do not need to be within the line of sight of the reader.

  • Passive and Active RFID Tags: Passive tags are powered by the reader's electromagnetic field. In contrast, active tags have their own power source, allowing for greater read ranges.
  • RFID Readers and Their Working Principle: RFID readers emit radio waves to activate the tag and read its data. The information captured can be used for inventory management, asset tracking, and personal identification.

Learn more about automatic identification system transponder here

Biometric Systems

Various biometrics applications identify individuals by comparing captured biological data against stored data for that individual. Biometric systems consist of a reader or scanning device, software that converts the scanned biological data into a digital format and compares match points, and a database that stores the biometric data for comparison. 

The unique physical or behavioural characteristics include fingerprints, facial recognition, and iris scans, offering high security and personal identification.

Optical Character Recognition (OCR)

Optical character recognition (OCR) recognises printed or written text characters by a computer. The process includes scanning the text character-by-character, examining the resulting character image and decoding that image into a machine-readable character code. OCR technology converts documents, such as scanned paper documents, PDF files, or images captured by a digital camera, into editable and searchable data. OCR is pivotal in transforming paper-based workflows into digital formats, enabling easier document management, archiving, and retrieval processes.

NFC (Near Field Communication)

NFC enables short-range communication between compatible devices, typically requiring a distance of 4 cm or less to initiate a connection. It's used for secure data exchange and contactless transactions. NFC allows two-way communication, enabling applications such as mobile payments, electronic ticketing, and access control.


Each core AIDC technology offers unique benefits and is suitable for various applications, from inventory management and asset tracking to secure access control and efficient data management. As businesses continue to embrace digital transformation, the role of these technologies in enhancing operational efficiency and security is becoming increasingly significant.


Applications of AIDC

The adaptability and efficiency of Automatic Identification and Data Capture (AIDC) technologies have led to their widespread application across diverse industries. These technologies streamline operations, enhance accuracy, and improve customer experiences by facilitating seamless data capture and analysis. This section highlights the key applications of AIDC in various sectors.

Retail and Inventory Management

Asset management and product traceability are paramount for dealers of all sizes. Most retail stores have a long record of using barcodes as their primary inventory management solution. Barcodes help keep accurate inventories, reduce theft, manage customer and employee experiences, and more. It reduces the likelihood of stockouts or overstocking, thus enabling retailers to manage their inventory more efficiently, ensuring that popular items are always in stock.

RFID tools are becoming more often used in retail. Modern RFID systems can help retailers with lower customer checkout times, identify low inventory levels and deter theft. One trend in retail is RFID product tags and smart shopping carts equipped with RFID readers. It allows customers to check out instantly from their cart, eliminating the need to wait in long queues for a cashier.


The healthcare industry benefits significantly from AIDC technologies, which help ensure patient safety and streamline healthcare delivery. In healthcare facilities, data must be accurate and easily accessible to doctors, caregivers and logistics staff. Barcodes and RFID wristbands are used to accurately identify patients and link them to their medical records, ensuring that they receive the correct treatments and medications. 

AIDC technologies also enable the tracking of pharmaceuticals from manufacturing through to dispensing, helping to prevent counterfeit drugs from entering the supply chain and ensuring that patients receive genuine medications.

Logistics and Supply Chain Management

AIDC technologies are pivotal in logistics and supply chain management, enhancing visibility and efficiency throughout the supply chain (e.g. with car logistics).

RFID and GPS technologies are essential for real-time asset tracking and asset management from the manufacturer to the end customer. This enables companies to optimise their logistics operations and reduce delivery times. 

But it also enhances the visibility of supply chain operations. AIDC technologies provide detailed data on the movement and condition of goods, enabling companies to make informed decisions and quickly respond to supply chain disruptions.


In the manufacturing sector, AIDC technologies drive efficiency and quality control throughout the production process. Manufacturers and industrial enterprises are streamlining and automating critical business processes using AIDC technology. For instance, RFID technology can increase the visibility of finished products and raw materials when used on production floors. This can optimise supply chain efficiencies.

RFID tags and barcode labels are used to track components and products through the manufacturing process, ensuring that each step is completed correctly and efficiently. At the same time, AIDC technologies facilitate the automation of data collection in manufacturing processes, reducing the risk of human error and ensuring that products meet quality standards. Read more about RFID tracking here...


The integration of AIDC technologies into these industries not only streamlines operational processes but also provides a foundation for innovation and improvement. By automating the identification and data capture processes, companies can achieve greater accuracy, efficiency, and security, leading to enhanced productivity and customer satisfaction. As technological advancements continue to evolve, the applications of AIDC are expected to expand, offering new opportunities for optimisation and growth across various sectors.



What is AIDC, and how does it work?

Automatic Identification and Data Capture (AIDC) refers to the methods and technologies used to automatically identify objects, collect data about them, and input that data directly into computer systems without human intervention. AIDC works by using various technologies such as barcodes, RFID (Radio-Frequency Identification), biometric systems (like fingerprint or facial recognition), optical character recognition (OCR), and near-field communication (NFC). These technologies capture data from an individual, object, image, or sound and convert it into a digital format that can be used for tracking, managing inventory, securing transactions, and interfacing with other systems.

Where is AIDC technology commonly used?

AIDC technology is used across various industries due to its versatility and efficiency in data capture and management. Common applications include:

  • Retail: For inventory management, self-checkout systems, and theft prevention.
  • Healthcare: To ensure patient safety by accurately identifying patients and tracking medications.
  • Logistics and Supply Chain Management: For asset tracking, enhancing visibility in supply chain operations, and improving delivery efficiency.
  • Manufacturing: Track components and products through production, ensure quality control, and automate data collection. Additionally, AIDC is used in security for access control, in banking and finance for secure transactions, and in many other sectors where accurate and efficient data capture is crucial.

What are the benefits of using AIDC technologies?

The use of AIDC technologies brings several key benefits, including:

  • Increased Efficiency and Productivity: By automating the data collection process, AIDC technologies significantly reduce the time and effort required for data entry, leading to increased operational efficiency.
  • Enhanced Accuracy: AIDC reduces the risk of errors associated with manual data entry, ensuring higher data capture and management accuracy.
  • Improved Security: Biometric technologies provide secure and unique identification methods, enhancing access control and transaction security.
  • Better Data Management: With AIDC, businesses can manage their inventory, assets, and resources more effectively, thanks to real-time data collection and analysis.
  • Enhanced Customer Experience: AIDC technologies like self-checkout systems and personalised services in retail and service industries improve the overall customer experience.



Automatic Identification and Data Capture (AIDC) technologies represent a cornerstone of digital transformation, offering a robust solution to manual data entry and management challenges across industries. Businesses can achieve unprecedented efficiency, accuracy, and security by harnessing the power of barcodes, RFID, biometrics, OCR, and NFC. As we move further into a data-driven era, the importance of AIDC systems in enhancing operational workflows, improving decision-making, and elevating customer experiences cannot be overstated. Embracing AIDC is not just about adopting new technologies; it's about investing in the future of seamless, automated, and intelligent data management. Learn more about Auto Identification Technology and Asset Agent.

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