Description
explains what is RFID, value of RFID and its applications. It also lists the RFID standards. How RFID helps in supply chain operations. What are the concerns of RFID for supply chain users.
RFID : Revolutionizing The Supply Chain Operations
Summary of lecture
• What is RFID? • RFID value and applications • RFID standards • Concerns for users: Cost factor & survey • Walmart study
Breaking News…
World’s supply chains are not totally effective: • Up to 20% of food items are discarded due to spoilage in the supply chain (US FDA) • 75% of the cost of a retail product is getting it there (MIT) • Product diversion, including smuggling, is large and increasing • Global shrinkage in the Consumer Packaged Goods (CPG) supply chain is $60Bn yearly (Shrinkage=theft, expiry, loss, damage before reaching the customer) • Direct and indirect cost of cargo theft is $20-60B yearly Imbalance between supply and demand in the supply chain: • Stock outs at retailers cost 6% of sales (P&G) • Over 50% of trucks on roads are either part or fully empty or are returning unwanted or expired products.
Source: Business Briefing Paper: AMCOR &HP
Solution : Automatic Identification (RFID)
"Our analysis shows that RFID is a transformative technology for the retail and supplier industries with the capacity to synchronize business processes and efficiencies across the supply chain," Ed Carey, Global Managing Director, Consumer Business, Deloitte Touche Tohmatsu.
What is RFID?
• RFID is an ADC (Automated Data Collection) technology that uses radiofrequency waves to transfer data between a reader and a movable item to identify, categorize, track... • RFID is fast, reliable, and does not require physical sight or contact between reader/scanner and the tagged item
RFID Timeline
48 - 74 - 79 - 84 - 95 - 99 - 03- 1/04- 4/04- 7/04- 1/05- 6/05- 10/05- 07 - 09 -
13
Today
What Constitutes an RFID System?
• One or more RF tags • Two or more antennas
• One or more interrogators
• One or more host computers • Appropriate software
RFID System Components
(block diagram) Antenna Asset/Tag Reader
Asset
Firmware
Tag
Insert
TCP/IP
Host
Customer’s MIS Application Software
~
Power
API
RFID Operation
Sequence of Communication
• Host Manages Reader(s) and Issues Commands • Reader and tag communicate via RF signal • Carrier signal generated by the reader (upon request from the host application) • Carrier signal sent out through the antennas • Carrier signal hits tag(s) • Tag receives and modifies carrier signal • Antennas receive the modulated signal and send them to the Reader • Reader decodes the data
– Results returned to the host application
RFID Operations
RFID -- The Tags
• Tags can be read-only or read-write • Tag memory can be factory or field programmed, partitionable, and optionally permanently locked • Bytes left unlocked can be rewritten over more than 100,000 times
RFID -- The Tags
Tags can be attached to almost anything:
– pallets or cases of product – vehicles – company assets or personnel – items such as apparel, luggage, laundry – people, livestock, or pets – high value electronics such as computers, TVs, camcorders
Are All Tags The Same?
Basic Types:
?Active –Tag transmits radio signal –Battery powered memory, radio & circuitry –High Read Range (300 feet) ?Passive –Tag reflects radio signal from reader –Reader powered –Shorter Read Range (4 inches - 15 feet)
RFID -- The Readers
• Readers (interrogators) can be at a fixed point such as
– Entrance/exit – Point of sale – Warehouse
• Readers can also be mobile -- tethered, hand-held, or wireless
Creating Value Through RFID Technology
RFID Adds Value…
• Improved Visibility
–Improved inventory cycle time –Reduction In Inventory Stock-Outs –Inter-Company Error Reductions –Improved In-Store Replenishment / Forecasting
• Reduced Labor Costs (80%)
–Minimizes scan time
• Reduced Theft and Counterfeiting
• Increased Efficiency
RFID and Visibility
Manufacturing
Stock Ship
Data capture “touch points”
Manufacturer’s DC Wholesale DC
The Basis of Improved Process Flow
Retail DC
RFID and Labor
By applying RFID to tote boxes, a leading retailer has reduced the receiving function from over 30s to under 3s per mixed pallet
RFID vs. Barcodes
Barcodes RFID / EPC
•No Line of Sight •Large Memory – Data Moves with Product / Asset •Dynamic Data Reads
+
-
•Low Cost •Broad Utilization •Human Readable
•Data Transfer Requires •Higher Costs Line of Sight •Limited Adoption •Data Storage is Limited •Standardization Issues •Environmentally Sensitive
Radio Frequency Identification (RFID)
Applications
RFID & Its Applications
• RFID Has a Proven Track Record In a Broad Variety of Applications
– – – – – – – – Yard management Container security Container tracking Product identification (each, IP, case, pallet) WIP tracking Inventory management Retail shelf management and checkout Warranty and maintenance – Animal identification – Anti-theft access control systems – Personnel security – Brand experience – Hospitality and tourism – Document management – Access control consumer payment – Toll systems
Portal Applications
Bill of Lading Material Tracking
Conveyor / Assembly Line
Read / Write Operations Higher Accuracy than Bar Code
Application Examples
Wireless / Batch Inventory Management Where is it? What is it? What is inside the box?
Material Handling By Destination Where is it going? Where has it been? Should it be here?
Material Handling Aggregate / De-aggregate What have I assembled or disassembled? How many do I have? Do I have enough?
Material Handling Inspecting / Maintaining Has this been repaired? Is this under warrantee? Has this been inspected? Is this complete? What is the asset’s status or state?
Radio Frequency Identification (RFID)
Standards
The Importance of Standards
• Provide References for Businesses
– Rigorous maintenance of standards
• Ensure Interoperability
– Users have choice of vendors
• Provide Common Data Formatting
– How do I represent this information?
• Allow Common Data Interpretation
– How should I interpret this data? – This must be unambiguous
International RFID Standards
• • • • • • • ISO 10374: Freight Containers ISO 11784/5: Animal ID ISO 14443: Contactless Smartcards ISO 15693: “Vicinity Cards” ISO 18000: Item ID ANSI MH10.8.4: Logistics AIAG B-11: Tire ID
RFID & Supply Chain Operations
© Q.E.D. Systems 2003
Cost-reduction objectives for an RFID implementation includes:
© Q.E.D. Systems 2003
• • • • • • •
Lower inventory stock levels Reduce waste Reduce manual checks Reduce inventory handling costs Reduce logistics costs Improve asset utilization Cost benefits through increased operations efficiency
Increased Revenue
© Q.E.D. Systems 2003
Both large and small retailers and manufacturers are developing RFID deployments to drive sales. The utilization of RFID empowers these companies to design innovative solutions with tangible benefits, including:
• • • •
Reduced out-of-stocks Improved order fill rates (Measure of DC’s efficiency) Improved inventory turns Enhanced in-store customer support
RFID In Manufacturing
© Q.E.D. Systems 2003
• Fast assembly /Assembly verification (QC) • Improved accurate/reactive production planning • Reduced stock/work in process (WIP), increase make-to-order • Reduced efforts on stock counts • Correct parts identification Accurate and real-time inventory • Accurate packing list and invoice information
RFID In Retails
© Q.E.D. Systems 2003
• Eliminate lost sales due to out of stocks • Speed up store receiving, processing, replenishment plus point of sale (POS) and returns processing • Notification of units needed on sales floor upon store receipt • Satisfy customer requests immediately by locating products on sales floor and in the backroom • Fast, accurate inventory audits • Increased distribution center efficiency and accuracy • Unit, carton and pallet-level visibility throughout supply chain • Immediate identification of exceptions at check points • Visibility to replenish the right product to the right place at the right time
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
• Concern #1: Return on Investment - ROI
Labor Visibility
Fewer Faster More Accurate
Supply Visibility
Where is the Inventory?
Demand Visibility
What are Customers buying?
Decision Visibility
What do customers want?
Reduction in costs > RFID technology investment = +ROI
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
• Concern #1: ROI – Easier said than done
Full Corp. Adoption
Maximizes - with data integration cost reduction real costs
Limited Mfg Adoption Reduces more
- with data integration - no data integration
Limited Mfg Adoption Reduces some
real costs
Tag and Ship
- with data integration
Link to trading partners “Slap & Ship” = pure cost May be the majority
Tag and Ship
- no data integration
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
• Concern #1: ROI – Easier said than done
Full Corp. Adoption
Maximizes - with data integration cost reduction real costs
Limited Mfg Adoption Reduces more
- with data integration - no data integration
Limited Mfg Adoption Reduces some
real costs
Tag and Ship
- with data integration
Link to trading partners “Slap & Ship” = pure cost May be the majority
Tag and Ship
- no data integration
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
• General Concerns:
– 60% worried about cost – 42% concerned about the lack of standards – 36% worried about market maturity/acceptance – 30% cite integration issues/problems
Source: Wavelink Corporation, FrontLine Solutions Magazine, Frontline Solutions Conference
Technology Management: Action Items for Business Managers
© Q.E.D. Systems 2003
•
Evaluate current business practices to identify the best RFID opportunities. Examine current processes to determine where increased visibility will improve or hurt current operations. Determine risks and rewards of early adoption. Assess capabilities of current information systems.
•
• •
doc_259953838.pptx
explains what is RFID, value of RFID and its applications. It also lists the RFID standards. How RFID helps in supply chain operations. What are the concerns of RFID for supply chain users.
RFID : Revolutionizing The Supply Chain Operations
Summary of lecture
• What is RFID? • RFID value and applications • RFID standards • Concerns for users: Cost factor & survey • Walmart study
Breaking News…
World’s supply chains are not totally effective: • Up to 20% of food items are discarded due to spoilage in the supply chain (US FDA) • 75% of the cost of a retail product is getting it there (MIT) • Product diversion, including smuggling, is large and increasing • Global shrinkage in the Consumer Packaged Goods (CPG) supply chain is $60Bn yearly (Shrinkage=theft, expiry, loss, damage before reaching the customer) • Direct and indirect cost of cargo theft is $20-60B yearly Imbalance between supply and demand in the supply chain: • Stock outs at retailers cost 6% of sales (P&G) • Over 50% of trucks on roads are either part or fully empty or are returning unwanted or expired products.
Source: Business Briefing Paper: AMCOR &HP
Solution : Automatic Identification (RFID)
"Our analysis shows that RFID is a transformative technology for the retail and supplier industries with the capacity to synchronize business processes and efficiencies across the supply chain," Ed Carey, Global Managing Director, Consumer Business, Deloitte Touche Tohmatsu.
What is RFID?
• RFID is an ADC (Automated Data Collection) technology that uses radiofrequency waves to transfer data between a reader and a movable item to identify, categorize, track... • RFID is fast, reliable, and does not require physical sight or contact between reader/scanner and the tagged item
RFID Timeline
48 - 74 - 79 - 84 - 95 - 99 - 03- 1/04- 4/04- 7/04- 1/05- 6/05- 10/05- 07 - 09 -
13
Today
What Constitutes an RFID System?
• One or more RF tags • Two or more antennas
• One or more interrogators
• One or more host computers • Appropriate software
RFID System Components
(block diagram) Antenna Asset/Tag Reader
Asset
Firmware
Tag
Insert
TCP/IP
Host
Customer’s MIS Application Software
~
Power
API
RFID Operation
Sequence of Communication
• Host Manages Reader(s) and Issues Commands • Reader and tag communicate via RF signal • Carrier signal generated by the reader (upon request from the host application) • Carrier signal sent out through the antennas • Carrier signal hits tag(s) • Tag receives and modifies carrier signal • Antennas receive the modulated signal and send them to the Reader • Reader decodes the data
– Results returned to the host application
RFID Operations
RFID -- The Tags
• Tags can be read-only or read-write • Tag memory can be factory or field programmed, partitionable, and optionally permanently locked • Bytes left unlocked can be rewritten over more than 100,000 times
RFID -- The Tags
Tags can be attached to almost anything:
– pallets or cases of product – vehicles – company assets or personnel – items such as apparel, luggage, laundry – people, livestock, or pets – high value electronics such as computers, TVs, camcorders
Are All Tags The Same?
Basic Types:
?Active –Tag transmits radio signal –Battery powered memory, radio & circuitry –High Read Range (300 feet) ?Passive –Tag reflects radio signal from reader –Reader powered –Shorter Read Range (4 inches - 15 feet)
RFID -- The Readers
• Readers (interrogators) can be at a fixed point such as
– Entrance/exit – Point of sale – Warehouse
• Readers can also be mobile -- tethered, hand-held, or wireless
Creating Value Through RFID Technology
RFID Adds Value…
• Improved Visibility
–Improved inventory cycle time –Reduction In Inventory Stock-Outs –Inter-Company Error Reductions –Improved In-Store Replenishment / Forecasting
• Reduced Labor Costs (80%)
–Minimizes scan time
• Reduced Theft and Counterfeiting
• Increased Efficiency
RFID and Visibility
Manufacturing
Stock Ship
Data capture “touch points”
Manufacturer’s DC Wholesale DC
The Basis of Improved Process Flow
Retail DC
RFID and Labor
By applying RFID to tote boxes, a leading retailer has reduced the receiving function from over 30s to under 3s per mixed pallet
RFID vs. Barcodes
Barcodes RFID / EPC
•No Line of Sight •Large Memory – Data Moves with Product / Asset •Dynamic Data Reads
+
-
•Low Cost •Broad Utilization •Human Readable
•Data Transfer Requires •Higher Costs Line of Sight •Limited Adoption •Data Storage is Limited •Standardization Issues •Environmentally Sensitive
Radio Frequency Identification (RFID)
Applications
RFID & Its Applications
• RFID Has a Proven Track Record In a Broad Variety of Applications
– – – – – – – – Yard management Container security Container tracking Product identification (each, IP, case, pallet) WIP tracking Inventory management Retail shelf management and checkout Warranty and maintenance – Animal identification – Anti-theft access control systems – Personnel security – Brand experience – Hospitality and tourism – Document management – Access control consumer payment – Toll systems
Portal Applications
Bill of Lading Material Tracking
Conveyor / Assembly Line
Read / Write Operations Higher Accuracy than Bar Code
Application Examples
Wireless / Batch Inventory Management Where is it? What is it? What is inside the box?
Material Handling By Destination Where is it going? Where has it been? Should it be here?
Material Handling Aggregate / De-aggregate What have I assembled or disassembled? How many do I have? Do I have enough?
Material Handling Inspecting / Maintaining Has this been repaired? Is this under warrantee? Has this been inspected? Is this complete? What is the asset’s status or state?
Radio Frequency Identification (RFID)
Standards
The Importance of Standards
• Provide References for Businesses
– Rigorous maintenance of standards
• Ensure Interoperability
– Users have choice of vendors
• Provide Common Data Formatting
– How do I represent this information?
• Allow Common Data Interpretation
– How should I interpret this data? – This must be unambiguous
International RFID Standards
• • • • • • • ISO 10374: Freight Containers ISO 11784/5: Animal ID ISO 14443: Contactless Smartcards ISO 15693: “Vicinity Cards” ISO 18000: Item ID ANSI MH10.8.4: Logistics AIAG B-11: Tire ID
RFID & Supply Chain Operations
© Q.E.D. Systems 2003
Cost-reduction objectives for an RFID implementation includes:
© Q.E.D. Systems 2003
• • • • • • •
Lower inventory stock levels Reduce waste Reduce manual checks Reduce inventory handling costs Reduce logistics costs Improve asset utilization Cost benefits through increased operations efficiency
Increased Revenue
© Q.E.D. Systems 2003
Both large and small retailers and manufacturers are developing RFID deployments to drive sales. The utilization of RFID empowers these companies to design innovative solutions with tangible benefits, including:
• • • •
Reduced out-of-stocks Improved order fill rates (Measure of DC’s efficiency) Improved inventory turns Enhanced in-store customer support
RFID In Manufacturing
© Q.E.D. Systems 2003
• Fast assembly /Assembly verification (QC) • Improved accurate/reactive production planning • Reduced stock/work in process (WIP), increase make-to-order • Reduced efforts on stock counts • Correct parts identification Accurate and real-time inventory • Accurate packing list and invoice information
RFID In Retails
© Q.E.D. Systems 2003
• Eliminate lost sales due to out of stocks • Speed up store receiving, processing, replenishment plus point of sale (POS) and returns processing • Notification of units needed on sales floor upon store receipt • Satisfy customer requests immediately by locating products on sales floor and in the backroom • Fast, accurate inventory audits • Increased distribution center efficiency and accuracy • Unit, carton and pallet-level visibility throughout supply chain • Immediate identification of exceptions at check points • Visibility to replenish the right product to the right place at the right time
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
• Concern #1: Return on Investment - ROI
Labor Visibility
Fewer Faster More Accurate
Supply Visibility
Where is the Inventory?
Demand Visibility
What are Customers buying?
Decision Visibility
What do customers want?
Reduction in costs > RFID technology investment = +ROI
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
• Concern #1: ROI – Easier said than done
Full Corp. Adoption
Maximizes - with data integration cost reduction real costs
Limited Mfg Adoption Reduces more
- with data integration - no data integration
Limited Mfg Adoption Reduces some
real costs
Tag and Ship
- with data integration
Link to trading partners “Slap & Ship” = pure cost May be the majority
Tag and Ship
- no data integration
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
• Concern #1: ROI – Easier said than done
Full Corp. Adoption
Maximizes - with data integration cost reduction real costs
Limited Mfg Adoption Reduces more
- with data integration - no data integration
Limited Mfg Adoption Reduces some
real costs
Tag and Ship
- with data integration
Link to trading partners “Slap & Ship” = pure cost May be the majority
Tag and Ship
- no data integration
Concerns for Supply Chain users:
© Q.E.D. Systems 2003
• General Concerns:
– 60% worried about cost – 42% concerned about the lack of standards – 36% worried about market maturity/acceptance – 30% cite integration issues/problems
Source: Wavelink Corporation, FrontLine Solutions Magazine, Frontline Solutions Conference
Technology Management: Action Items for Business Managers
© Q.E.D. Systems 2003
•
Evaluate current business practices to identify the best RFID opportunities. Examine current processes to determine where increased visibility will improve or hurt current operations. Determine risks and rewards of early adoption. Assess capabilities of current information systems.
•
• •
doc_259953838.pptx