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  • 1. Case Study Tagging & Verification Retail Pilot Mobile Maximo RFID Implementation Date: 18 March 05
  • 2. Contents 1. ABSTRACT ...................................................................................................................3 1. BACKGROUND.............................................................................................................4 2. PROJECT GOAL.............................................................................................................5 3. PILOT OVERVIEW........................................................................................................7 4. PROCESS OUTLINE......................................................................................................8 5. TECHNOLOGY OUTLINE..........................................................................................12 6. PEOPLE........................................................................................................................17 7. PILOT GAPS.................................................................................................................18 8. CONCLUSIONS............................................................................................................19 9. ACKNOWLEDGEMENTS AND FURTHER INFORMATION.................................20 10. APPENDIX 1 - APPLICATION SCREENSHOTS....................................................21 2
  • 3. 1. ABSTRACT...................................................................................... Can the use of mobile auto identification technologies solve the asset compliance challenges that the Sarbanes-Oxley (SOX) Act requires? Most observers would agree that the Sarbanes-Oxley (SOX) Act is the single most important piece of legislation affecting corporate governance, financial disclosure and the practice of public accounting since the US securities laws of the early 1930s. In July 2002, the United States Congress passed the Sarbanes-Oxley Act into law. The act was primarily designed to restore investor confidence following well-publicised bankruptcies that brought chief executives, audit committees, and the independent auditors under heavy scrutiny. The act is applicable to all publicly registered companies under the jurisdiction of the Securities and Exchange Commission. UK companies with a US listing, such as BP, are also subject to the Sarbanes-Oxley Act. From an asset management viewpoint, BP needs to answer the following questions satisfactorily in order to comply with the Sarbanes-Oxley Act: 1. Do you have an accurate inventory of all your physical and intangible assets? 2. Have you reconciled asset data from different systems? 3. Do you have a full history and audit trail of all Asset Transactions? 4. Do processes exist to detect unauthorised Acquisitions, Disposals and Transfers? It is apparent that asset verification projects will play critical roles in addressing these requirements for Sarbanes-Oxley compliance. However what about sustainability? What about the concept of using a mobile application together with Radio Frequency Identification (RFID) tags as the basis for ongoing sustainability? BP Africa, the Marketing Downstream business stretching from South Africa to Tanzania recently tested such a scenario. 3
  • 4. 1.BACKGROUND BP Africa holds an extensive range of assets valued at approximately $700 million. In order to provide legal compliance, safety assurance and the effective management of these assets, the business unit needs to know: “What assets do we currently have? Where are these assets located? How are these assets changing over time? “ Currently it is unable to do this in a standardised and consistent manner because of the problems highlighted below: o Asset data is duplicated across several systems. o Data held on one system is not made available to other systems. o Reports are drawn from various sources and are inconsistent. o No systemized verification exercises having taken place since 2000. These problems have resulted in fundamental control weaknesses in the management of the fixed asset base which needs to be corrected in order to comply with the requirements within the Sarbanes-Oxley Act, which state that BP needs to: o Ensure that it has the correct asset management policies and procedures in place. o Ensure that its assets are to be properly labeled and classified. o Ensure that asset data from different systems is reconciled. o Ensure that a full history and audit trail of all asset transactions is in place. o And to ensure its assets are secure. Hence it has begun work on a comprehensive Asset Tagging and Verification project, the objective of which is to create an accurate and verified record of fixed assets with significantly more detail than the existing financial system is able to provide. 4
  • 5. 2.PROJECT GOAL In order to add value a whole new approach to verifying, tagging and managing a fixed asset base of approximately 180,000 items has been adopted. This approach utilizes Automatic Identification, (Auto-ID) which is the broad term given to a host of technologies that are used to help machines identify objects automatically. By making use of this type of technology, the identification of assets, the capture of information about them and the mechanisms of getting this data into a computer system(s) without having employees type it in, will ultimately result in increased efficiency, reduced data entry errors and will ensure that asset registers are easily kept up to date. Diagram1: Illustration of Asset Tagging Technology The project’s goal has been to find that affordable, accurate and flexible method for tracking assets (and their condition) anywhere a communications link exists, which will result in a verified record of fixed assets. In addition to the implementation of a mobile Asset Care solution that ensures that a higher level of solution sustainability will exist once the verification exercise is completed. The first phase of this process was concluded with the initial investment in the Maximo Enterprise Asset Management solution. Its build saw the creation of a series of generic placeholders that the “real” asset data, which, once collected, will replace, as illustrated in diagram 2. 5
  • 6. Diagram 2 – Generic Asset Placeholders in Maximo 6
  • 7. 3.PILOT OVERVIEW Before conducting a project of this scale it was seen as prudent to first begin with a pilot before emulating the process throughout the region. The key objective of the pilot was to demonstrate how assets could be verified; and how asset tracking could be accomplished via a mobile asset care solution utilising the applicable auto id and mobile technologies. In addition the pilot aimed to: o Determine appropriate workflow for the integration of Asset Care; o Determine value of tagging for reducing cost associated with Asset Churn; o Determine most appropriate forms of tagging; o Determine infrastructure needs (e.g. savant, middleware and Maximo integration); o Determine data flow requirements; o And to determine a cost model for asset tagging. While the project’s overall scope covers the Retail, Commercial and Industrial (C&I) and Logistics businesses in South Africa, Namibia, Botswana, Mozambique, Zambia, Malawi and Tanzania excluding Zimbabwe, the pilot was conducted in Cape Town, South Africa and it’s scope included the following: o In Scope  Completely tag and record asset data at two full convenience and three fuel sites  The duration was to be no longer than two months  And to be concluded before year-end December 04 i.e. a project timeline of five months with the work effort being completed Sept- Dec 04 and pilot performance monitoring Dec -Jan 05 (two months). o Out of Scope  Sanitising (data cleansing) of the Asset this area of work would be scoped and designed in “Define”. 7
  • 8. 4.PROCESS OUTLINE RFID will not solve bad processes but has the ability to improve those that exist even providing the impetus for realigning these processes with an RFID benefits driven approach. The pilot attempted to outline two key processes with this in mind: o On site Asset Tagging and Data Collection o Ongoing Asset Verification Because both of these where to a large degree “new” the predominant focus of the process mapping involved how the target audience would react to what was proposed i.e. did it fit in with their current workload and expertise. Page: Title: Mapping: Level: Status: Date: 5 Level A4 : Track assets To-Be 3 DONE 09/2004 Target Audience Deployment Schedule Project Goals Defined Processes Informed staff Arrival Checklist Asset List Template Communicate Job Card Safety Guidelines Tagging Guidelines Exception Sheets Plans Tagging Rules Data Verification Errors Handle Deployment Schedule Wrap Up Sheet Exceptions 1 Training Schedule Connectivity Settings Synch Guide 5 A41 Rollout Schedule Work Order System A45 Updated processes Trained contract organization. Planning Team Trained support organization Train Delivery BP Admin Staff Data Capturer New Work Order types Tagging Rules 2 A42 Tag Existing Exception Sheets Assets Asset Planners 3 Installation Contractors Asset Checklist Maximo Administrators A43 Connection Settings Mobile Support Staff Planned Branch Visit Sales Managers Synchronization Guide Trainers BP Admin Scanning Guide Dealer Arrival Checklist Contractor Asset List Data Capturer Asset List Asset List Template Defined Processes Exception Sheet Perform ongoing Trained Sales Managers Feedback Form tracking Trained support organization New Work Order types Scanning Guide Tagging Guidelines 4 Tagging Rules A44 Training Manual Target Audience Wrap Up Sheet Job Cards Sales Manager Updated Asset List Dealer Job Cards BP Admin Version:1.0 Diagram 3: High Level Process Map - Click on the diagram and zoom 200 The overall process started with the communication of the project and continued through training, initial tagging of the assets and on to the regular monthly scanning of the assets by the sales managers (SMs). This is graphically illustrated above by diagram 3. 8
  • 9. 5.1 On Site Tagging and Data Collection A turnkey contractor with the relevant experience and skill level was appointed to perform this task with the aid of an internal “Assets Tagging” co-ordinator who would play a liaison role between the role-players – Dealer; BP Sales Manager; Turnkey Contractor and Technical Back- office. In this process the turnkey tagging contractor (In-site Info) together with BP’s project co- ordinator would: o Schedule – Pilot sites. o Confirm visits with the Dealer o Ensure that all work done would start with the standard BP Asset Care work order This key process is described in more detail below and illustrated in diagram 4. Work order creation rules arrival checklist asset list template job card safety guidelines Rollout tagging guidelines schedule tagging rules wrap up sheet connectivity settings Prepare for site synch guide visit logged 1 job Informal feedback card A431F BP Admin Handle Perform Site Visit exception sheet installation dealer issues contractor 2 4 work-order Data system A432F Tagged verification A434F Asset data errors updated schedule dealer updated guidelines data capturer updated sales manager plan contractor updated validation rules BP Admin feedback form forecourt map Perform weekly colour stickers data checks RFID tags scanner exception sheet 3 connectivity to BP A433F Operational data store BP Admin Diagram 4: Asset Tagging Process Map - Click on the diagram and zoom 200 When the contractor arrived on site, they would be required to approach the dealer or site owner with the work order in hand and introduce themselves. The contractor would go through a short interview and a checklist with the dealer to understand the assets on the site. The checklist covers items such as stolen assets, broken equipment, third party equipment (e.g. Coke sponsored fridges) and dealer owned equipment. Regardless of ownership each asset is tagged and recorded. To minimise the disruption on site the process recommended that the contractor walk around the site with the dealer and identify each asset and its owner individually. The contractor could use coloured stickers to mark ownership (e.g. green=BP, red=third party, blue=dealer, white=unknown, etc.) during the site walk-through. 9
  • 10. Using the template document that describes the assets that are typically found on the site and which BP are interested in tagging. All assets whether they are owned by BP, the dealer or a third party are to be tagged. BP is responsible for the safety of its sites and any third party equipment must conform to BP’s Health and Safety tracking requirements. Certain fixed assets (as specified by the catalogue list) such as the canopy or coldroom which are high value, are not tagged because their status is unlikely to change. Whether assets are tagged or not their static and performance data is collected for analysis in the back office. Once the assets have been identified and marked, the contractor can begin to tag and record each asset. When the tagging is complete, the contractor will confirm the asset list with the dealer and get signoff of the work order. Finally, the contractor will need to synchronise the handheld to return the captured asset information back to BP. Any paper forms, such as exception sheets or insurance records (in the case of stolen assets) will either be faxed for mailed back to BP. 5.2 On-Going Scanning The Sales Manager (SM) manages the relationship between the business and the Dealer as part of their normal management activities they perform regular visits to “their” sites. Part of their responsibility is the maintenance of the asset list, which forms part of the lease agreement between the Dealer and BP. The SM would still do their normal sales-related activities at the branch as before with the addition of recording of the existing assets on site. They would thus be doing the continuous monitoring of the state of the assets as they visit each branch at least once a quarter as part of their regular sales activities. The intention is to simplify the asset recording process and with the aid of the RFID technology to minimise the amount of disruption to the Sales Managers job (15-30 minutes extra). In preparation for their visit, the Sales Manager would connect to BP and download the current asset list from the server to the handheld. They should also download the Business Objects (Data Warehousing Software) report for a copy of the latest outstanding job cards for the site. These two lists should be reviewed in preparation for the visit. At the end of the visit, the Sales Manager will record any exceptions that were discovered as described in the scanning guidelines document. They would also create any new work requests, either by calling in to the call center or directly on the handheld (when this service is available). Once the visit has been completed they would synchronize the handheld with the BP server when they connected to the BP LAN. 10
  • 11. Diagram 5: Swim lane View of the Verification Process Map - Click on the diagram and zoom 200 asset scanning guide asset list job cards checklist Sales Manager scan and record scan out branch scan in branch tag assets tag perform discuss perform discrepancies with regular site asset review dealer visit activities Dealer feedback form exception report 11
  • 12. 5.TECHNOLOGY OUTLINE In an effort to define the architecture for the project, three solution proposals where requested and submitted by: o IBM o SAIC and o Syclo These proposals (Technical Infrastructure Plans) were submitted in relation to the pilot phase of the project with the expectation that the solution piloted would have a high degree of fit for the production solution. Following an initial one-day workshop held in London (July 04), a more comprehensive two-day workshop was held in Cape Town (Sept 04). IBM and SAIC were present but not Syclo who were briefed by Brian O’Regan (INTEL) in his capacity as Technical Advisor to the project. 6.1 Evaluation Format As part of the workshop a matrix of key issues was developed which formed the basis for the evaluation. These included: o Tag suitability o Support network o Standards compliance o Solution component availability o Solution flexibility; compatibility and integration o Scalability Two issues, Cost and Partnership Aspects which were not covered in the technical evaluation were dealt with by the selection panel. 6.2 Overall Conclusions On purely technical merits, it was concluded that any of the three proposals would have supported the business need. Implicit in the evaluation was however, a reference to time as per the project Terms of Reference that stated that the pilot would be completed by end-2004. In this regard the Syclo option provided the most immediately available solution. The only potential downside to this solution was a considerable degree of “lock-in”. The Syclo solution was the least flexible in terms of application integration and potential development. If the decision horizon was strategic rather than tactical, then either the SAIC or the IBM solution became more attractive. Differentiating between these two would need to be made within a broader context and as part of a separate evaluation. 12
  • 13. 6.3 Syclo Back-End Solution Diagram 6: Syclo Back-end Technical Solution The backend solution comprised of: o Audit and Work Order Application: Syclo (Mobile Maximo) o Front-End application middleware: Agentry o Back-end Application (Maximo) interface: Agentry. Agentry is the underlying architecture that supports these applications. It has a GUI based development environment that allows for rapid modifications of base screens and business logic; it essentially serves as the “middleware” solution onto which the Maximo Mobile Suite and RFID integration has been built. Once the backend architecture was in place attention was then given to getting the front-end right. 13
  • 14. 6.4 Front End Technical Solution The following technical selections where made with regard to getting the front end correct. TAGS Factors Piloted Type Low Frequency  Successfully used in LPG Yes  Low Frequency 30mm (134 Mhz) pilot in Holland; Disk Transponder  Robust;  Manufactured by Texas  Very Stable; Instruments (RI-TRP-R9QL)  Short Read Range  Operating frequency of 134.2 kHz  Est. read range < 60 mm  Typical read time : 70ms  Dimensions : 29.4 mm x 8.4 mm  Weight : 8 gram Middle hole allows tag to be screw mounted High Frequency  Good tactical fit Yes  High Frequency (13.56 Mhz)  Read range 0.5 -1.0 m 13.56MHz “Laundry”  Stable Transponder  Available  Manufactured by Texas Instruments (RF-HDT-DVBB- N0)  Compatible with ISO15693 standard for 13.56MHz tags  Est. read range 12-14mm (on a steel structure with 3mm adhesive backing)  Data retention time: more than 10 years  Dimensions: 22 mm x 3 mm Weight: 1.6 gram Ultra HF (913 Potentially the best strategic No Mhz) fit but 915Mhz band is currently not available in South Africa RFID Factors Piloted Type READERS TSL 134 Mhz Rugged Yes  RFID Wireless Bluetooth “puck” Size of a matchbox handheld tag scanner ATEX 1  Operates on both 134.2 kHz and 13.56 MHz  Supplied by Technology Solutions UK Limited  Dimensions: 56 x 41 x 21 mm  Weight: 51g  Intrinsically safe for use on the forecourt - ATEX 1 Bluetooth range: 10 meters TSL 13.56 Mhz Rugged Yes Same as above. 14
  • 15. “puck” Size of a matchbox ATEX 1 HANDHELDS Factors Piloted Type Symbol MC 9000  Rugged No  Rejected because it was not  Bluetooth end user friendly.  WLAN  GPRS  Very Industrial and expensive Symbol PPT  Good tactical fit Yes  Symbol PPT 8800 Series 8860  Rugged  Manufactured by Symbol  Bluetooth Technologies  WLAN but no GPRS  Dimensions 33 H x 80 W x  Safe for use on forecourt 146 L (mm)  Nice look and feel  Weight (with wireless lan):  Expensive 306g  Display: TFT-LCD, 65K colors, 240x320 Screen  Intel XScale 300/400 MHz processor  Windows Mobile 2003  Memory: 32Mb / 64Mb RAM  Serial, USB and IrDA Connectivity IPAQ 6340 Good strategic fit No  Not safe for use on the Not rugged (two screens forecourt went down in less than two  Very fragile. weeks) Not safe for use on the forecourt Telephone; GPRS; Bluetooth Nice look and feel Cheapest option Table 1: Front end Technology Selections 15
  • 16. When all the components were pieced together this is what the front-end technical solution looked like: 56 y e P Hz c ss ct to B en le er M ce gs le ad qu ad ire vi Ta ur st i t y Cr 3. kH Fre Re de W ID fra tiv r1 d ru ld h g RF el o in n e c zo ot Ta he di dh to Ra nd ID n n ue Co Ha RF 2 Ha Bl 4. 13 Diagram 7: integrated Front-end Technical Solution 16
  • 17. 6. PEOPLE The development of capabilities in a consistent and standardised way did not occur because both the process and technology solutions where being developed in parallel and at a very high rate. The resultant training was often via show and tell; learning by playing and participating; some trial and error and via open channels of communication. As a result much of the time was spent in trying to design the potential training templates that would be needed rather than formally presenting specific courses to the respective audiences, this was a restriction encountered as a result of a tight timeline and a global project team who often had other project commitments. ) M B i n or .I r oj CT n ng d m act to .g Se le S ept (e Pr l D Co nti ac r tr ne C S y C on tr ce ca ion cou ax an an rt ff ur A F o or M po ta M ten Pl Lo lat c I n c e nt so C mo ce al & A s tS n ni up e n e co t ai Re D tio re g le r na m ai ar ur ea Mg M ng Fi ure M tC rip Tr c t A r ni s e e c i n i oc ob le ss es st C Sa Pr D D Communication Introduction to what is being done Kick-off and why. How the rollout will take communication x x x x x x x x x x x x x x place The process by which the Installation Process x x x x x x x installations will be done at the sites The process by which sales Ongoing Scan manager staff will do the ongoing Process x x x x x x x x x x x x scanning The schedule by which the High level process x x x x x x x x x x x x x installation will be done The schedule by which the Install Schedule x x x x x x x x x installation will be done MIS Summary reports of the results Results of install x x x x x x x of the installation Results of install (per MIS Summary reports of the results branch) x x x of the installation per branch Results of install MIS Exception reports of the results (exceptions) x x x x x x x x x x x of the installation per branch Results of ongoing MIS Exception reports of the scan (exceptions) x x x x x x x x x x ongoing scanning per branch Training How and where to apply tags to Tagging x x equipment How to categorize equipment in Categorising x x x x x Maximo heirarchy How to use the handheld HH application x x x x x application How to synchronise with the Sync'ing device x x x x x handheld The information going into Data transmit x x x x x x Maximo Diagram 8: Training and Communication Plan Summary 17
  • 18. 7.PILOT GAPS The pilot produced the following GAPs: No TECHNOLOGY GAP IMPACT FIX/MITIGATION 8.1 Handheld battery life LOW Double size battery; Car Charger; approximately three-four hours. Additional Batteries to be carried by Turnkey Contractor. 8.2 Battery life of the “puck” LOW Battery should last approximately 16 hours. No power indicator but can be recharged using a Nokia Cellphone charger. Additional pucks to be carried and investigate a non blue- tooth add-in. 8.3 No Reads of Low Frequency Tags LOW High Frequency tags more off metal surfaces. appropriate and will be used for the full roll-out. 8.4 Partial Reads of High Frequency HIGH Investigate and test a tag with a Tags off metal surfaces. plastic backing which will work in this environment. 8.5 Application enhancements MEDIUM Minimal, involved reworking some of the data templates and embedding the application into the PDA RAM, so that it would auto install if the battery went down. No PROCESS GAP IMPACT FIX/MITIGATION 8.6 Process conformance by Asset MEDIUM Once technical solution is robust and Tagging Contractor and SMs where tags are giving 100% read. Process minimal. training will formally be given to all parties. No PEOPLE GAP IMPACT FIX/MITIGATION 8.7 Capability with regard to use of HIGH Proper training material has been the handheld. developed to close this GAP. It deals with wider topics not just the use of the application. 8.8 Support for Handheld and HIGH Process and subsequent agreements/ Application. contracts will need to be in place prior to a full roll-out. 18
  • 19. 8.CONCLUSIONS The use of RFID technology on the Asset Tagging and Verification pilot provided enough evidence that increased RFID network connectivity to a broad range of high value assets translates to better control and management and ultimately more efficient asset tracking. Once the GAPs have been closed the pilot goes a long way to satisfying the SOX requirements with regard to asset management. The use of RFID will enable the Business Unit to improve its sensing capabilities within the technology’s actual limitations as well as the business readiness. It should be noted that the RFID will not make bad Asset Management processes better, or miraculously clean bad data in the Asset Register, but with the correct upskilling of the user base will make a good practice better and allow for more accurate asset management at far less cost and complexity. Looking forward the Model now offers the BU a platform – a strong electronic back-bone - to develop its asset verification and tagging strategy. The era of using spreadsheets and bar-coding to control assets over a wide and diverse area, will soon be over for complex, asset intensive, Business Units within the Group, and with an asset base of $8bn, it is vital that BP begins using auto identification technology to extract value, and to extend the useful and safe life of its assets. 19
  • 20. 9.ACKNOWLEDGEMENTS AND FURTHER INFORMATION This paper was written by Robin Golding (BP Assets Project Manager, BP Africa), David Mooney (IBM Business Consulting Services), Brian o’ Reagan (Intel, Solutions Architect) and Neil McKinley (SAIC). With assistance from Curt Smith (BP US Application Director, CTO); James Neophytou (IBM Business Consulting Services), Nick Waller (SAIC Business Consulting Services), David Evans (TSL), Tom Altergott (Syclo) and Emily Woffod (IT Business Consultant/Project Manager). For further information on the project please contact: robin.golding@za.bp.com 20
  • 21. 10.APPENDIX 1 - APPLICATION SCREENSHOTS Logging On Screen Pilot Sites with RFID tag type 21
  • 22. Establishing the bluetooth connection Scanning the tag and capturing other information from drop down lists. Equipment details and specifications Setting up two blue tooth readers using the “favourites” option. 22