Electronic Cash News

Avery Dennison, the label maker, has a great RFID 101 video that provides an extensive overview of what is RFID and how RFID technology can be used to track items, boxes, and pallets. Avery is a natural fit to be a leader in passive RFID tags. Most passive RFID tags are now being embedded in labels for good reason - costs, efficiency, quality control. Avery who has the experience of making bar code labels that can withstand any environment is demonstrating they have the knowledge to produce cheap, quality RFID tags.

Avery Dennison’s RFID 101 video covers all the basics and challenges of passive RFID tags. This includes how they are made, how readers work, how RFID labels are created, how they are applied, facility installation challenges, and how RFID technology can be used. Also, good discussion on RF frequency standards and the Electronic Product Code (EPC). See Avery Dennison’s RFID 101 video for more information (Note: you have to sign in to view video). Also, Modern Materials Handling has a lot of good links on RFID technology.

Having product-level RFID tags from manufacturing through Point-of-Sale (POS) offers the opportunity to automate the entire supply chain. Consumer’s can go through a RFID-checkout line without handling goods except to possibly bag them to carry home (stores could even automate home delivery). Stores with the right automation can receive goods and stock them. The only handling needed would be where materiel handling automation is not available to store and stock shelves. No more looking for stuff or even making decisions on where to slot pallets or products in backrooms. The RFID tags automatically inform store computer systems what stuff is coming in and out of the stores. No more ordering or wall-to-wall physical inventories.

At distribution centers and warehouses with the right materiel-handling automation, everything is automated. All humans would do is to do management-by-exception type activities and maintenance. Even manufacturers could further automate finished product material handling.

Wal-Mart is setting the standard for a fully RFID-enabled supply chain by moving from various RFID pilots to specific plans to implement RFID at the product-level at Sam’s Club by 2010. Their schedule is as follows:

- Jan. 30, 2008. All solid SKU pallets sent to Sam’s DeSoto, Tex. distribution center must be tagged

- Oct. 31, 2008. All pallets sent to four additional DCs must be tagged; tagging of cases and mixed case pallets for product sent to the DeSoto DC

- Jan. 30, 2009. Pallet-level tagging at the remaining 17 Sam’s DCs; tagging of cases and mixed case pallets for product sent to the four DCs in the October 31, 2008 pallet program

- Oct. 31, 2009. Tagging of cases and mixed case pallets for product sent to the other 17 Sam’s DCs; selling unit tagging for DeSoto

- Jan. 30, 2010. Selling unit tagging at the next four DCs

- Oct. 31, 2010. Selling unit tagging at the remaining DCs

See SupplyChainDigest’s article, RFID News: As Wal-Mart Gets Tough with Sam’s Club Compliance, Some Clarity, While a Few Questions Remain, for more details. RFID tags are “finally” going to revolutionize the world (I think).

I see that Savi Technology, an active RFID tag provider, has spawned a communications and information services company that provides near-real-time visibility to international shipments regardless of carrier. I see a good business case for using this shared RFID network. Benefits include: proactive container security monitoring, auditable chain of custody, proactive temperature monitoring, comprehensive shipment tracking, “virtual inspection” of shipment and contents, timely information to re-route shipments, dynamically allocate inventory in-transit, manage transportation based on actual asset movements, and streamline customs clearance.

I see SaviNetworks as a niche communications company that provides high value to international shippers that need positive control over their transportation services as well as positive control over the assets that they are shipping. See more on the benefits of SaviNetworks.

Active RFID technology is used to track high-value assets either in motion or at a specific location. Because active RFID tags have their own power source (vs passive RFID does not), there are unlimited applications to include near-real time tracking, security monitoring, temperature monitoring, querying the status of assets simultaneously, manipulating data residing on the RFID tag, and so on.

Because active RFID tags and its associated interrogation network are scalable only by buying more RFID hardware, it is very important to pick the right type of RFID tag and associated interrogators to fit your current and future requirements. Key considerations in picking the right type of active RFID technology include:

- Standards-based or proprietary communication protocol. Open protocol like Wi-Fi (802.11) offer more opportunities, but what about unique functionality?

- Frequency and method of tag communications. Does the tag need to send a signal periodically or does the network interrogate the tag. If you need the tag to communicate with the network very frequently, this is a drain on the RFID tag battery.

- Tracking and location capabilities. Do you need the exact location or just how close the RFID tag is to a given interrogator?

- Batteries. You need to understand the RFID tag battery technology and how long the batteries will last based on your requirements. You need to have a battery maintenance plan and how proactive you need to be in replacing batteries.

- Sensor sensibility. What do you need to monitor? Location, motion, temperature, and so on?

- Other factors - Learning new tricks, ease of configuration, In-the-field implementations, range of accessories, total cost of ownership, tag to interrogator range, environmental factors, are the tags actionable to your business needs, scalability, and security.

See SDCExec.com’s article The Active RFID Tag Guide for more information on active RFID technology.

RFID has always been an innovative technology, but with item-level tracking becoming a reality RFID is now a disrupting technology to the retail industry. RFID item-level tracking is disruptive in that now retail stores can have complete situational awareness of their stock. There is no need for inventories, stock leakage becomes immediately visible, clerks and customers do not need to go hunting for stuff, no reason for out-of-stock conditions, and so on.

RFID has been around for more then 10 years, but has not had much effect at the retail level where bar codes have been king. Now that RFID-item level tracking is technically feasible and cost justified, an innovative technology now becomes a disrupting technology to a whole industry. For an example of how RFID-item level tracking is changing retail businesses, see article on Fujitsu Transaction Solution’s RFID implementation at a STAPLES Business Depot store using AbsoluteSKY’s intelliTRACKER product suite.

SupplyChainer has a great video link on ERP in the U.S. Army. Enterprise Resource Planning (ERP) has traditionally been for manufacturers, but with the trend toward ERP II all large organizations are looking to ERP to solve their data synchronization challenges across the organization.

I am seeing three distinct ways that organizations are looking to address data synchronization within their organization and with their suppliers and customers. One is go the ERP route that the U. S. Army is going at the macro level. The other way is to use a managed file transfer solution or value added network (VAN) to exchange information between organizations and systems. Another emerging supply chain technology is RFID tags where the status of the products and shipments can actually be stored on the RFID tag as it travels with the product. Then systems could poll the RFID interrogation network to get the data and process it for the system’s unique needs. No need for systems to exchange data with each other.

RFID is definitely a revolutionary technology, but all revolutions do not end in success. Modern Materiel Handling has a good RFID article on a modest RFID rollout by Tesco. Here they are integrating into their systems a passive RFID tag network to track roll cages going to their store. Basically, the RFID tag gives Tesco the proactive ability to make sure their roll cages get to the right stores.

Tesco is using the passive RFID tags to alert distribution center workers loading trucks and store dock workers when a roll cage is not suppose to go to the store. That way they can take corrective action before mis-directed goods get stocked in the wrong store. This RFID solution may not be quite a revolution, but it is a good return on investment (ROI).

Information technology professionals have wrestled with B2B information exchange standards for decades. First there was electronic data interchange (EDI), then EDIFACT, Rosetta Net, XML, and so on. Can there ever be a universal standard for B2B and supply chain information exchange between business systems?

To me there is no “silver bullet” for a universal standard for the way businesses exchange data system-to-system today. It is not because the communications, technology, or data standards cannot be developed or acquired. It is more about competitive advantage. Businesses that use information in unique ways will keep ahead of the competition. It is the old “80/20″ rule. You can get 80% of the data interfaces standardized, but the other 20% are going to be non-standard because it is supporting some unique, value add information service.

If active Radio Frequency ID (RFID) tags ever come down in price, there may be an opportunity to standardize data and data interfaces within supply chains using RFID tags and common-use RFID interrogation networks. In an active RFID scenario, the attached RFID tag would hold and update standard data elements about the shipment or product. The data about the product or shipment would actually travel along the supply chain with the product or shipment. Then business systems throughout the supply chain could interrogate the RFID tag to get as little or as much data as they want at any point in time. There are closed, proprietary RFID interrogation networks that do this today, but these networks are not available for general commerce.

E-Seals are an emerging class of active RFID devices with built-in security and tracking features that enhance visibility, security and efficiency of in-transit cargo containers, which account for 90 percent of world trade. E-Seals are a smart move marrying up physical security and online tracking in one device for cargo containers.

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Many companies are following Wal-Mart’s lead in implementing RFID to improve their supply chain visibility and operations. If companies are implementing RFID just because market leaders are implementing it, they may be asking for a disaster. RFID is expensive and technically not mature. If the ROI is not identified, wait on RFID.

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