Way to Smart SCM - RFID
Determining item status and its movements tracking during logistic transactions, productivity, inventory accuracy, monitoring of items and timely response to inquiries are critical loop holes for any organization.
The traditional way of capturing and entering data into a computer system is to gather the data on paper and key it in after events occur. A more evolved data capture system is based on the use of bar code labels, whereby manually scanning the code, one can identify the item - whether that item is a product, an asset or a location - and obtain a set of data relative to the SKU level properties of the item.
To overcome the disadvantages of manually captured data, an advanced automatic and item level data capture system; Radio Frequency Identification (RFID) has been developed.
Radio frequency identification (RFID) is a method of remotely storing and retrieving data using devices called RFID tags. An RFID tag is a small object, such as an adhesive sticker, that can be attached to or incorporated into a product. RFID tags contain antennas to enable them to receive and respond to radio-frequency queries from an RFID transceiver.
RFID systems originated in the 1940s, when the U.S. government used transponders to distinguish friendly aircraft from enemy aircraft. Through the 1970s, the federal government primarily used the systems for projects like tracking livestock and nuclear material.
Usage of RFID however includes animal identification, beer keg tracking, automobile key-and-lock, anti-theft systems, library book or bookstore tracking, pallet tracking, building access control, airline baggage tracking, apparel item tracking, identification badges and in pallet and container tracking, truck and trailer tracking in shipping yards.
However RFID is creating great impact in B2B and B2C especially in managing supply chain model and retailing.
Companies such as Wal-Mart, Procter and Gamble and Boeing have started to apply RFID tags on their products.
1. Wal-Mart began asking its suppliers that it will be required to put RFID tags on their products beginning from January 2005.
2. Procter and Gamble has already introduced RFID tags to its supply chain to hasten its logistic service paces.
3. Boeing uses RFID tags to track parts as its product move through its facility.
4. Sun Microsystems, Inc., and SupplyScape Corporation created a Pharmaceutical Anti-Counterfeit RFID Package, an offering enabling companies in the pharmaceutical supply chain to combat counterfeiting and diversion while gaining efficiencies throughout the supply chain.
5. McDonald's and ExxonMobile are testing RFID chips to allow customers to pay for food or gas.
Why RFID instead of Barcode or another traditional methods?
RFID-based systems provide efficiency and accuracy similar to those of printed bar code systems, and offer additional benefits such as:
Label face readability
RFID supports read/write operation. RFID's real-time characteristic enables efficient updating of information contained within the tag as an item moves from one point to another. For example, a tag on a delivery truck can contain the truck's manifest, which can be updated easily as the driver adds and removes items.
Insensible to greasy and contamination
RFID is not limited to contact operation. RFID tags can be read through nonmetallic materials, and a reader does not have to touch a tag, making RFID ideal for cluttered, dirty, wet, and harsh environment. Unlike bar code scanners, RFID scanners can read tags through mud, dirt, paint, grease, wood, cement, plastic, water, and steam.
Integral capability with sensors
RFID tags can be hidden. Because RFID is not limited to line-of-sight operation, you can embed tags under skin, inside clothes hems, and within the pages of a book, preserving the item's usability and aesthetics.
Security
RFID tags are very secure. RFID tags are virtually impossible to counterfeit, because an unalterable permanent serial code prevents tampering. This guards against an unauthorized user changing data corresponding to a particular item.
Faster speed
RFID tags are read at a faster speed. The time it takes for an RFID reader to activate the tag and receive the associated information stored in the tag is approximately 40 percent faster than scanning traditional printed bar codes.
Multi-label readability
Multiple RFID labels can be read at one time, speeding up the data collection process. A scanner can read each tag independently when mixed in a pile, distinguishing among multiple items based on each one's unique identification number.
RFID Enablers
Successful technology solution providers and industry companies have ambition to create the next evolution of the UPC by developing the standards and infrastructure necessary to leverage Radio Frequency Identification Device (RFID) technology across the value chain.
The ePC (Electronic Product Code),a 96- bit unique item-level code, written onto a smart chip and attached to the product, will enable full traceability of the product as it moves through the value chain.
In conjunction with Auto-ID's Object Naming Service (ONS) and Physical Markup Language
(PML), the ePC enables a seamless flow of product information throughout the product's life cycle creating the industry's first "intelligent" value chain.
Auto-ID brings us closer than ever to realizing an integrated, seamless supply chain that not only reduces cost, but also virtually eliminates inefficiency and drives benefits for all stakeholders -manufacturers, retailers and consumers.
Model Providers
Silent commerce at Accenture
For several years, Accenture have been exploring the business potential of these innovative technologies at Accenture Technology Labs ' Silent Commerce Centers located in Chicago, Illinois; Palo Alto, California; Sophia Antipolis, France and the Accenture Institute for Strategic Change in Cambridge, Massachusetts. Accenture has a vision for Auto-ID and broader related technologies, called "Silent Commerce". Silent Commerce creates unlimited new business opportunities by making objects intelligent and interactive. It is "silent "because communication and commerce can take place between objects such as cases of paper towels, dock doors and warehouse management systems.
Auto-ID Center: An MIT's Effort
The Auto-ID center was formed to address three issues, namely companies' problems tracking items throughout the supply chain, the UCC's thoughts of the future, and MIT researchers' quest for computer sensing. The Auto-ID Center started on October 1, 1999 with just MIT, UCC, Procter & Gamble, and The Gillette Company as members. It has since expanded in all directions. The center has grown to 73 sponsors - 34 end-user companies and 39 vendor companies.
IBM
As a member of the Auto-ID Center and leading sponsor of the Business Case Action Group (BCAG), IBM Business Consulting Services is developing a series of adoption strategies for clients. Based on the real costs and benefits of these solutions and input from other Auto-ID sponsor companies, IBM Business Consulting Services is writing a series of business cases that will help drive the adoption of Auto-ID technology and quantify the value in the Auto-ID system. IBM is working closely with over 35 leading global consumer goods, retail and technology companies to develop business cases that reflect the realities participating companies face, as well as the current state of the applicable technology.
According to AMR, both Accenture and IBM currently benefit from having been early to invest in building their RFID capabilities, as well as from having worked on dozens of RFID projects for CP manufacturing companies looking to meet Wal-Mart's RFID-compliance mandates. According to AMR, these two companies are currently involved in over 90 percent of RFID projects implementation projects. Other companies covered in the report were Atos Origin, BearingPoint, BT Syntegra, Capgemini, Clarkston, Deloitte, Entegreat, HP, Infosys, Intelligroup and Unisys.
RFID is a powerful technology, and it is a technology that is likely to see worldwide deployment within the coming years. However costs, scope and privacy issues need to be taken care.
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