1. Are you ready for RFID?
The promise and challenges of implementing Radio Frequency
Identification (RFID) systems across the extended supply chain
A SAS White Paper
2. Table of Contents
Executive summary ....................................................................................................... 1
Tracking the elusive object........................................................................................... 2
RFID 101 – A quick tutorial ........................................................................................... 3
What’s so great about RFID and EPC, when UPC bar codes are everywhere? ..... 4
Not just a mandate, but a merit .................................................................................... 6
The data challenges of RFID — trouble with petabytes ............................................ 6
SAS solutions for RFID applications ........................................................................... 8
Manage exponential increases in new data................................................................. 9
Validate what you want, filter out what you don’t ......................................................... 9
Integrate with existing systems .................................................................................. 10
Find the business value in the data ........................................................................... 10
Share data among diverse users and organizations ................................................. 12
Advantages of an end-to-end RFID business intelligence solution ....................... 12
What companies can gain from RFID data................................................................ 13
Closing thoughts ......................................................................................................... 14
About SAS .................................................................................................................... 14
3. The primary content provider for Are You Ready for RFID? The promise and challenges of implementing
Radio Frequency Identification (RFID) systems across the extended supply chain was Wayne Embry,
technical architect at SAS. Wayne can be reached at firstname.lastname@example.org.
4. Are You Ready for RFID?
While still in the very early stages of adoption and rollout, radio frequency identification (RFID) —
touted as the new bar code — holds great promise for retailers, manufacturers, third-party
logistics providers and many other organizations. RFID, which enables
wireless tracking of virtually
An RFID system consists of an RFID tag on each object to be tracked — carton, pallet, vehicle, any kind of object, is
animal, etc. — and fixed or handheld readers to scan those tags. These components use radio revolutionizing supply chain
frequency waves to exchange data, such as product code, manufacturer, destination and more. management, but it also
The data can be transmitted over typical network interfaces to company databases — or it can be introduces enormous data
used to notify a programmable logic controller to trigger an action, such as raising an access gate management challenges.
Are you ready for it?
or interfacing with a transaction database to complete a sale.
For all of the expense and preliminary technical glitches of the new technology, RFID holds great
promise for all parties in the extended supply chain. For example:
• For manufacturers, RFID enables detailed, automated monitoring of parts as they move
through a facility, and quickly identifies the origin of defective components or products, even
after they have been sold.
• For distributors, RFID manages inventories and fleets so effectively that manual tasks can be
eliminated, processes can be dramatically accelerated and shipping errors can be reduced.
• For retailers, RFID ensures appropriate stocking levels, tracks the origin and history of
products, prevent theft or misplacement of goods and speeds up checkout lines.
Where traditional bar coding requires one-by-one scanning of a visible bar code label, RFID
readers can simultaneously scan hundreds of tagged items, whether or not the tag is visible. And
whereas traditional bar coding can only tell you what type of product is being scanned, RFID can
be used to uniquely identify each individual item.
As you can imagine, all this detailed data will give companies unprecedented visibility into the
extended supply chain, from originating source to consumer. Companies can reduce inventory
control issues, increase efficiency, make better use of corporate resources, improve customer
service and get a broader and more complete view of their internal operations.
Yet major challenges remain. RFID systems will ultimately generate a staggering amount of
data — perhaps 100 to 1000 times the data of conventional bar coding systems. As the
technology becomes more and more widespread, adopters will be challenged just gathering and
managing these massive amounts of data, much less finding the nuggets of knowledge amidst all
For nearly 30 years, the fundamental mission of SAS has been to help companies organize,
harness, analyze and exploit data from any external or internal source. To SAS solutions, RFID
data is just another resource — a potential goldmine of business intelligence that can be
integrated into the flexible, extensible SAS information infrastructure.
5. Are You Ready for RFID?
All SAS solutions can be configured to accept, analyze and deliver business value from RFID
data. Furthermore, all SAS solutions are built on a solid framework of data management and
analytic technology that can scale to handle databases of any size — even the petabytes of data
that RFID systems are expected to generate for large retailers and government agencies.
Tracking the elusive object
After the December 2003 discovery of bovine spongiform encephalopathy — commonly known as
“mad cow” disease — in western Canada and Washington State, agricultural authorities in both
countries were grim. The disease, which attacks the animal’s central nervous system, can be
harmful or fatal to humans who eat infected beef. Would North America witness a repeat of the
outbreaks and deaths that plagued Britain and Europe in the previous decade?
The disease had to be stopped in its tracks. To do that, cattlemen and government agencies
needed to be able to track the origin, movements and destination of every animal likely to enter
the food chain. As a result, neither country wanted cattle crossing its borders, even though the
ban represented a huge loss of market for Canadian producers and a huge loss of grazing land
for American producers.
In mid-2005, the bilateral ban was lifted, thanks to a tiny chip — a radio frequency identification
(RFID) tag. Under nationally regulated programs, cattle crossing international borders are marked
with ear tags embedded with RFID chips. These tags trigger access to valuable information about
each animal — information that could potentially be used to stop the deadly disease right at the
RFID technology isn’t new. During World War II, RFID technology enabled the British Air Force to
uniquely identify their planes. When you cruise through a toll booth and auto-pay on the fly, you’re
using active RFID technology. You’ll even find RFID microchips implanted under the skin of
millions of household pets, identifying their owners.
What is new is the rapid and imminent spread of RFID technology into a host of new commercial
applications. Already, the U.S. Department of Defense and Wal-Mart are requiring their top
suppliers to implement RFID technology in their supply chains. Target, Albertsons, Best Buy,
Tesco of the United Kingdom and the Metro Group of Germany are following suit.
Wal-Mart, the world’s largest retailer, has been the undisputed leader of the RFID revolution. As
of January 2005, RFID was already in use in 104 Wal-Mart stores, 36 Sam's Clubs, and three
distribution centers. The company had installed more than 14,000 pieces of hardware and run 230
miles of cable to support RFID initiatives. More than half of the 100 suppliers who were tasked to
implement RFID were already shipping tagged cases and pallets — and Wal-Mart had already
scanned more than 7,000 pallets, 200,000 cases and 1.5 million individual tags.
Best Buy has gone public with its RFID plans, pledging to have its suppliers start delivering RFID-
tagged product cases and pallets by January 2006.
6. Are You Ready for RFID?
However, retail applications are just the beginning. For example:
• Manufacturers are using RFID technology to track the movement of parts through their
facilities and through distribution centers and delivery fleets.
• Airports are deploying RFID systems to track passenger baggage.
• The new Airbus A380, the world’s largest passenger airplane, contains more than 10,000
RFID tags on removable pieces and those requiring periodic maintenance or replacement.
• Healthcare facilities are investigating the potential of RFID tags to protect patients from
medical errors and protect babies from abduction.
• Pharmaceutical companies embed RFID tags in drug containers to prevent counterfeiting and
abuse of regulated substances.
• Libraries are tagging books with RFID tags to quickly located misplaced books on the shelf
and enable self-service checkout.
• One tool manufacturer is hoping RFID tags built into its power tools will stem contractors’
multimillion-dollar losses from workplace theft.
As more manufacturers of RFID tags, readers and software solutions enter the market, the price
of the technology will continue to decline and practical applications will continue to grow. Sales of
RFID tags are expected to increase dramatically in the next few years, mostly for shipping carton
tags, as major retailers and suppliers adopt the technology. In fact, sales of RFID tags are
forecast to jump from $300,000 million in 2004 to $2.8 billion in 2009.
RFID 101 – A quick tutorial
Radio frequency identification (RFID) refers to the process of using radio signals to exchange
data between ID tags and readers. The technology is used primarily to locate, identify and track
objects — products, containers, vehicles, animals... just about anything.
An RFID system includes several primary components: tags, tag readers and data.
RFID tags consist of an integrated circuit and an antenna, which are either enclosed in a
protective housing, laminated on a surface or embedded in label material. A tag is applied to or
embedded in every object to be tracked (product, carton, pallet, etc.).
• Active RFID tags contain an internal battery and can transmit their own information to a
reader. Active tags can be read from a great distance (hundreds of feet), but the internal
battery increases the size and cost of the tag — and limits its service life.
• Passive tags get their power from the reader, just enough to give up their information to the
reader. Passive tags have a much smaller readable range (20 inches to 20 feet, depending
on the radio wave frequency used), but they can be economical, very small — as small as a
grain of rice — and have a virtually unlimited service life.
7. Are You Ready for RFID?
Tags can be read-only, read-write, or a combination of both, where some data (such as a serial
number) is permanent, and additional memory is available for data to be added or updated later.
RFID readers or “interrogators” use radio waves to retrieve information stored on a tag. The
reader might trigger the tag to transmit its information, or the tag might automatically broadcast its
signals continuously or at set intervals. Readers can be mobile or fixed — integrated into
handheld terminals or mounted on forklifts or at strategic locations in a facility. Encryption protects
the privacy of data passing between tags and readers.
The RFID reader then passes the tag data to a computer or local application system known as the
Object Name Service (ONS), which identifies where information about that specific product can be
found on the network. This information can be transmitted over company intranets or the Internet
in the usual fashion.
An RFID tag stores an electronic product code (EPC), the RFID equivalent of a UPC code. The
Auto-ID Center at Massachusetts Institute of Technology (MIT) created the current EPC standard,
which contains a 96-bit “smart label” that designates the product manufacturer, product name and
a 40-bit serial number.
This information in this smart label is written in a Product Markup Language (PML) based on the
The EPC differs from the
eXtensible Markup Language (XML), a standard that enables computers to easily share EPC
UPC in that it can uniquely
information. The new EPCglobal Inc. organization (www.epcglobalinc.org) was formed to
identify every single item,
commercialize and support this EPC coding system.
even though several items
have the same UPC. The
EPC also identifies non-
consumer products, such
as components, cartons What’s so great about RFID and EPC, when UPC bar codes
and pallets that don’t have
UPC codes. are everywhere?
Created in the early 1970s and printed on most everything you buy from retailers, universal
product code (UPC) labels provide valuable information about products. These striped bar codes
help organizations understand how much of a part or product is moved or sold, and to some
extent, where or to whom. This information help manufacturers and retailers track inventory and
speed up the check-out process. However, bar codes have a few shortcomings:
• For inventory purposes, you have to physically scan every bar code on every box/product.
• Going through the checkout line, every item must also be individually scanned.
• The UPC code must be visible — not obscured or hidden inside vehicles or packaging.
• Bar coding is a read-only technology; it cannot record any information on the label itself.
RFID overcomes these limitations, but it is not expected to replace UPC bar coding. It will
complement that established technology by providing greater flexibility and information-carrying
capacity than bar codes can offer.
8. Are You Ready for RFID?
Specifically, RFID offers the following advantages:
No line of sight required. Being a radio technology, RFID does not require a line of sight
between tag and reader. Tags can be read through cardboard containers and plastic pallet wrap.
They can be read through mud, oil and ink that would render bar codes unreadable. RFID tags
can be read even if items are inside a truck or facing in all different directions on a pallet or
conveyer. If RFID tags are on every item inside every carton, you can read them, too, if you have
a powerful enough system.
High-speed, simultaneous processing. If you have ever dabbled with self-service checkout at
your local grocery store or Wal-Mart, you can appreciate that bar code scanning can be slow. You
scan the items, one by one. In contrast, RFID readers can simultaneously read all the tags within
their range, up to 800 tags per second, depending on the equipment and environment.
Transmission speed and range are determined by the frequency used, antenna size, power and
interference, but always far surpass bar code and manual processes. This processing capacity
makes RFID ideal for high-speed material-handling, packaging, receiving and sorting operations.
In a futuristic in-building deployment, stationary tag readers could automatically scan tagged items
as they pass key points in your facility.
Greater data capacity. RFID tags can carry all the same information as bar codes and more. The
tags come in different sizes and with different encoding options, so you can choose the right
combination of price/capabilities for the application. Moreover, bar codes are read-only, but
read/write RFID tags can accept and store new and updated information that they receive as they
Unique individual identifiers. A bar code can only tell you that an item of a certain type from a
certain manufacturer or source was moved or purchased, but not exactly which one. If you need
to trace a manufacturing defect, a shipping error or a passenger’s suitcase, it might not be enough
to know the category and type. You need to be able to identify and track the specific, individual
item. That one.
The EPC supplies not only basic UPC-type information, such as company/entity and object class
(similar to stock-keeping unit, SKU), but also a unique serial number that identifies the specific
instance of the object class being tagged.
You can determine not just that the object is a “black rolling suitcase,” but that it is “John Smith’s
checked bag one of two that was screened through security in Salt Lake City at 1:11pm,
destination Chicago on flight 1337.” You’ll be able to identify a box not just as “Candygram
Crunchies-24 oz,” but “Candygram Crunchies from Grand Rapids production line A422 between
8:20am and 8:40am on 04-10-05” or cattle not just as “2003 Angus heifer,” but “Heifer
#US42287101WYO012103, born 01-21-03 in holding area C at the Lazy UR Cattle Co. and
shipped into Canada on July 14, 2005.”
9. Are You Ready for RFID?
Not just a mandate, but a merit
When the world’s largest retailer issues an edict to its top suppliers, they listen. Among the first
suppliers to deliver RFID-tagged pallets to Wal-Mart were Gillette, Hewlett-Packard, Johnson &
Johnson, Kimberly-Clark, Kraft Foods, Nestle Purina PetCare, Procter & Gamble and Unilever.
“Most enterprises are going to RFID because their distributors or customers require it, but the
RFID technology has
benefits can be substantial internally,” wrote George Spohrer, Jr., PE, an executive with the
enormous potential for
accounting and consulting firm, Crowe Chizek and Company LLC. (Network Computing, “Get
ready for the RFID Wave, June 2005). Early adopters say that RFID technology will save
countless millions of dollars by eliminating inefficiencies in the supply chain. No more manual
business processes and
pointing the way toward counting, no driving around, no question of mispicks, no order number mistakes.
opportunities that otherwise
would never have been Monitoring and reporting can be automatic and unattended. For instance, RFID readers can be
recognized. strategically placed to create security zones within facilities. Supervisors can be notified if
someone attempts to remove a tagged item.
Improved visibility across an extended supply chain, enabled by RFID, could trim $2 to $4 billion
in costs from the consumer packaged goods and retail industries, according to Yankee Group
research. An Accenture study suggests that manufacturers can reduce working capital
requirements 2-8 percent and reduce inventory shrink by 10 percent.
Supply chain experts
predict that RFID will
For Wal-Mart, the business case is about improving customer satisfaction while maintaining low
eventually provide much-
prices for customers. With RFID, Wal-Mart can eliminate many manual processes in receiving,
needed visibility into the
retail supply chain,
moving product in warehouses and distribution centers, shipping to stores and paying suppliers.
providing product shipment For their suppliers, Wal-Mart promises that RFID will enable them to reduce inventory and
and inventory views in improve sales, because Wal-Mart will handle their product more efficiently and always have their
unprecedented detail. product in stock on store shelves.
The data challenges of RFID — trouble with petabytes
For all its promise, RFID still faces some technical constraints. Standards are still evolving, tags
and readers are expensive and some products and environments have made tag-reading
problematic. Second-generation standards and technology improvements are rapidly resolving
However, some challenges remain for those who must capture and digest RFID data. Let’s take a
look at some of these issues:
Exponential increases in data volume. A typical RFID tag might contain just a few kilobytes of
data, perhaps just a 96-bit EPC code that stores the most basic information about the tagged
object. That’s a pittance. However, many tags can store much more information than that (such as
movement among locations, pricing and ordering history, and environmental conditions).
Furthermore, a single RFID reader can transmit data from up to 800 such tags per second. Data
points can add up fast.
10. Are You Ready for RFID?
If the company wants to track individual products at multiple checkpoints, RFID has the potential
to generate 100 to 1000 times the data volume of conventional bar code technology. Wal-Mart is
looking at generating some 7.5 terabytes of RFID data per day — a volume that could easily
overwhelm some systems and data warehouses.
Filtering out unwanted data. Many events tracked by RFID systems will be irrelevant to your
operational and intelligence systems. For instance, it may be relevant that a chilled product
passed a designated checkpoint at 30ºF on its way to the mixing station, but it doesn’t matter
what temperature the empty container registered when it passed by the same reader on its way to
recycling. Other events will be irrelevant at face value but essential for the hidden intelligence they
will later reveal.
When the system is capturing massive amounts of streaming data every second, how do you
separate signal from noise? How do you filter through the information you really need to gather
and keep for business systems and intelligence? Data management systems will require flexible
rules to organize, filter and cleanse input, so systems won’t drown in nonessential data.
Integration with existing systems. To reap the real benefits from RFID, companies must
“RFID trials have
effectively integrate RFID data into existing supply chain management (SCM), customer demonstrated how
relationship management (CRM), and enterprise resource planning (ERP) applications. This will managing all this new
entail new transaction types and data formats, and new correlations between EPC numbers and information can be a
internal inventory numbers and UPCs — transmitted in real-time XML rather than batch EDI challenge. RFID can
(electronic data interchange). Data management and integration processes will have to move swamp your network with
more nimbly and flexibly than today’s bar coding systems require. real-time, streaming data
related to the location and
Finding the business value in the data. Companies are making a mistake if they implement contents of cartons, cases
RFID as a “slap and ship” process, slapping labels on product and shipping it out the door just to and pallets. Make sure
your servers and network
meet downstream expectations. The real value of the technology, the real ROI, will be found in
can handle this onslaught
exploiting RFID data to optimize processes and relationships.
of new data. And determine
what you will do with the
RFID makes it possible to gather new information from internal places and processes, faster and new data.”
in greater detail. It provides visibility into the extended supply chain, from suppliers to
manufacturers to distributors to retailers and even customers. It tracks items in more places, George A. Spohrer Jr.,
PE, Crowe Chizek and
without human intervention, which makes it possible to deploy new features and applications.
Smart companies will use this information to run the business more efficiently and profitably.
(In Network Computing,
Data sharing among diverse users and organizations. The promise of RFID is that information
about products can flow across the extended supply chain. Participating organizations will
therefore face new requirements for creating and sharing detailed information for each EPC
number, such as product identifiers, manufacturing data, expiration, lot tracking, pricing and
customer order information. Data exchange will be more complex than the EDI interchange of
Some organizations will use a central clearinghouse for this process; others will be so wary of
privacy concerns that they’ll use peer-to-peer processes. Chances are, your IT systems will need
to accommodate a variety of processes and protocols. There’s also the human factor to consider.
Data won’t be very useful unless it is available where and when needed, presented in a format
suitable for the needs of very different types of users.
11. Are You Ready for RFID?
SAS solutions for RFID applications
For nearly 30 years, the fundamental mission of SAS has been to help companies organize,
harness, analyze and exploit data from any external or internal source. To SAS solutions, RFID
data is just another source — a potential goldmine of business intelligence that can be integrated
into the flexible, extensible SAS information infrastructure.
All SAS solutions can be configured to accept, analyze and deliver value from RFID data. And all
SAS solutions are built on a solid framework of data management and analytic technology that
can scale to handle databases of any size — even those containing massive amounts of RFID
The following solutions are likely to have the most relevance for organizations as they deploy
• SAS data integration (ETL) capabilities bring together and organize RFID data in a way that
makes it suitable for analysis and cross-functional (or inter-company) communication.
• SAS data quality capabilities validate and cleanse that data, along with other types of data,
to enable users to have confidence in the results of reporting and analysis.
• Platform management solutions enable SAS administrators to define the information-
management framework for RFID systems, such as business rules, data models and flows,
authorized users and stored processes.
• Business intelligence systems, including retail-specific solutions, transform RFID and other
data into meaningful intelligence, uncover patterns and trends, and identify opportunities for
• Analytic intelligence solutions help you understand not only what was in the extended
supply chain, but also “What if?” and “What will be?” In dynamic markets, predictive insight
can be as valuable a competitive differentiator as product/service quality and price.
• “Fit-to-task” interfaces deliver the right information in the right format to suit the diverse
needs of business users, quantitative specialists and executives.
• Strategic performance management enables the organization to analyze RFID data in
context with overall performance management efforts.
Each component of this “intelligence value chain” adds incremental value to the organization.
Synergies among modules make the total solution truly greater than the sum of the parts, as each
module offers functionality that affect all other components in the integrated, end-to-end
Let’s take a look at how SAS solutions specifically address the key data challenges described
12. Are You Ready for RFID?
Manage exponential increases in new data
Data management. SAS provides the industry’s most powerful DATA INTEGRATION platform,
which aggregates data from currently incompatible data silos on any platform and any format.
Powerful, out-of-the-box data transformations eliminate the need to manage thousands of lines of
custom code. An interactive interface makes it easy to manage ETL and data integration
processes to support RFID data requirements across the enterprise.
High-throughput, scalable processes. Grid computing and a high-throughput, multithreaded
architecture enable SAS data processes to efficiently process the massive volumes of data that
RFID systems are expected to create.
RFID systems entail complex data-sharing scenarios that span platforms, applications and protocols.
SAS provides the vehicle to bring this disparate data into a common data repository, where it can be
integrated into existing or new intelligence applications.
Validate what you want, filter out what you don’t
Data quality. Data quality processes are fully integrated into the data integration platform, to
transform and combine disparate data (such as RFID data from different types of tags and
frequencies), remove inaccuracies, standardize on common values, parse values and cleanse
dirty data to create consistent, trustworthy information.
13. Are You Ready for RFID?
Information mapping. SAS analysts can design information flows with embedded analytics and
strategic business rules that filter out “noise” and process only the valued data from RFID
systems. Information architects can then translate technical warehouse and data structures into
terms that business users can understand, and specify business rules that define how data can
With these “information maps” in place, business users can self-sufficiently conduct their own
queries without being mired down in finding the meaningful nuggets among masses of cryptic and
irrelevant data elements. They can transparently reuse SAS analytical procedures without
needing advanced skills in statistics or support from IT.
SAS therefore creates a collaborative domain that links previously isolated specialists in statistics,
finance, marketing, and logistics — and provides the whole user community with access to
company-standard analytic routines, cleansed data and user-appropriate presentation interfaces.
Integrate with existing systems
To gain value from your RFID data, you need to be able to use it within existing operational and
analytical systems, even though they may all use different platforms and data definitions. The key
to this integration is to establish consistency by means of metadata (the information about data:
how it was derived, business rules, access authorizations and so on).
SAS provides an open, centralized and integrated repository for managing metadata. Central
management of metadata ensures that information is accurate and consistent, even though it may
originate in and be shared among disparate systems within and outside your organization.
Differences among platforms and applications are reconciled through unified definitions of data,
locations, content and business rules that are accessed by all components of the business
This common metadata environment provides for consistency and interoperability between
applications. RFID data could significantly enhance the accuracy and value of your customer
relationship management (CRM), supplier relationship management (SRM) and enterprise
resource planning (ERP) systems.
Find the business value in the data
Business intelligence applications. SAS offers analytic applications that support enterprise
intelligence, customer intelligence, supplier intelligence, supply chain intelligence and strategic
performance management — as well as turnkey solutions for various vertical markets, such as
retail, financial services, pharmaceuticals, health care, telecommunications, automotive and
energy. All of these applications are RFID-compatible and can be applied to derive actionable
business intelligence from RFID data.
14. Are You Ready for RFID?
Retail-specific intelligence applications. SAS Retail Intelligence Solutions, like all SAS
solutions, are RFID-compliant and can immediately handle all RFID data, from the supply chain to
point-of-sale transactions. The software suite for retailers includes components for understanding
and predicting customer behavior, determining net profitability of merchandise, assessing and
improving promotions, and managing retail performance at a strategic level. Within this integrated
software suite, two components are particularly relevant for RFID implementations:
• SAS Supply Chain Costing for Retail combines advanced data management and a retail-
specific costing methodology. Retailers gain financial visibility into supply chains by
consistently measuring and analyzing true supply chain costs and net product profitability as
products move through distribution centers, stores and customer checkouts. Incorporating
RFID data into this solution, retailers can model the financial impact of merchandising and
supply chain decisions with greater detail and accuracy than ever, and make timely, fact-
based decisions about new process, product or promotional initiatives.
• SAS Strategic Performance Management for Retail translates business strategy into
Going beyond other
actions that can be quickly measured and monitored throughout the organization. This
solution can glean data from across the enterprise, including RFID data, to monitor retail-
vendors' talk of drill, sort,
specific key performance indicators, perform scorecarding, and create maps and knowledge-
filter and rank as
base visualization that help decision makers set and monitor high-level performance targets.
"analytics," SAS offers true
Predictive analytics. Historical query and reporting tools tell an organization where it has been, analytical power that
but companies really need to be able to predict and manage events, not just react to them after enables you to predict
the fact. They need to understand how, where and why costs are being incurred to be able to future outcomes of interest;
model the impact of planned changes to business processes. That’s why SAS offers advanced to explore and understand
analytics that incorporate various types of predictive capabilities: complex relationships in
data; and to model
• Predictive modeling helps you set the best processes and policies, optimize dealings with behavior, systems and
customers and suppliers, understand which initiatives are most effective and address many processes.
other organizational issues, such as fraud detection, failure analysis, predictive maintenance
and risk management.
• Descriptive modeling helps you understand important relationships and the implications of
those relationships over time, space and across new outlets, markets and processes.
• Forecasting lets you accurately estimate future conditions and proactively prepare for them.
SAS provides the only forecasting software that can be integrated into existing systems,
access all kinds of data sources (including RFID data) and run on different platforms.
• Optimization capabilities can identify the most effective combinations of factors (such as
warehouse layout, pallet configuration, truck size and distribution route) to produce peak
results within known budgets and constraints. In a manufacturing or distribution environment,
for example, optimization can determine which procurement strategies make the most
economic sense, select the distribution routes with the lowest transportation costs, or juggle
multiple resources to keep production projects on track and under budget.
The integration of RFID data into these systems enhances the knowledge base as well as the
accuracy and timeliness of decisions that result.
15. Are You Ready for RFID?
Share data among diverse users and organizations
We recognize that all this business intelligence is only useful if it is shared and used. So, SAS
provides a full range of “out-of-the-box” client interfaces to suit all user types, enabling users to
select the tool that is most appropriate to their individual skills and analytic requirements. For
• SAS Enterprise Guide enables business analysts, statisticians and programmers to publish
dynamic results throughout the organization from within a Windows client application.
• SAS Web Report Studio uses step-by-step “wizards” to enable non-technical business
For nearly three decades, users throughout an organization to conduct their own Web-based query and reporting.
SAS has been
accomplishing the hard • SAS Add-In for Microsoft Office enables users across the company to take advantage of
tasks: developing a SAS analytics within the comfort of Microsoft Office products such as Word and Excel.
powerful, extensible, end-
to-end business These query and reporting tools deliver the highest quality of information when and where it is
intelligence architecture needed to improve decision making for all authorized users. You can save, share, publish and
and the industry’s most
distribute reports via multiple platforms and channels, including the Web, customized business
robust analytic suite. Now
portals, e-mail and wireless devices for better collaboration and shared intelligence.
we have also done the
easy part: making all that
With these self-service interfaces, rich analytic information is available to a wide spectrum of
power available to users
who have little or no users, while IT staff is freed from the non-stop stream of ad hoc requests. Information quality
statistical background. improves too, since more people are empowered with robust tools — able to get their own
answers while IT retains control over the consistency and reliability of the data they use, and
administrators retain control over access privileges.
SAS offers a breadth of solutions for managing RFID data and data-flow processes, with fit-to-
task interfaces for all types of users.
SAS provides a range of
client interfaces and
Advantages of an end-to-end RFID business intelligence solution
visualization techniques so
that non-technical users, When formulating a strategy for converting RFID data into quality business intelligence, a
analysts and statisticians company might be tempted to piece together technologies from different vendors. For example, a
each have a workspace company could cherry-pick favorite software packages, tools and platforms. With this type of
that is appropriate to their approach, you could potentially end up with a dozen or more vendors to supply all the
role and find it easy to components of the total solution.
interact with their data,
model business scenarios,
Even though the individual components might each be prime choices, this diversified, multi-
and send the output to
vendor strategy can be maintenance and integration nightmare. Integrating all those products is a
hundreds of different
time-consuming and non-value-adding activity. Furthermore, the whole platform is at the mercy of
the weakest link. If one supplier scales back R&D, gets acquired or merges, or goes out of
business, it affects the entire intelligence value chain, the organization’s competitiveness and the
16. Are You Ready for RFID?
For that reason — and to control spiraling cost — many companies are consolidating their
business intelligence portfolio around one or two strategic vendors. For that approach, SAS offers
a broad portfolio of RFID-ready solutions (from data source to end user) plus the ability to
integrate legacy systems and data into a unified intelligence architecture.
In any business intelligence implementation, the biggest liability can be juggling vendor
relationships. From integration to troubleshooting, multivendor architectures can be more costly
and vulnerable than unified solutions — especially as mergers and acquisitions continue to
reshape the vendor landscape.
What companies can gain from RFID data In any business intelligence
implementation, the biggest
If organizations can effectively manage the huge volumes of RFID data and integrate the valued liability can be juggling
subset of that data into business intelligence applications, there are tremendous benefits to be vendor relationships.
From integration to
By providing much more information than bar codes can deliver — faster and more flexibly —
can be more costly and
RFID opens up options for new applications that wouldn’t be feasible with bar codes alone. For vulnerable than unified
example, your RFID system could: solutions, especially as
mergers and acquisitions
• Continuously monitor inventory of an item and automatically reorder from an online continue to reshape the
purchasing application when stock dips below a certain threshold. vendor landscape.
• Automate manual processes, such as creation of shipping manifests and verification of
incoming and outgoing shipments.
• Identify when objects are misplaced — a patient is headed to the wrong operating suite, a
library book is on the wrong shelf, or a pallet is loaded on the wrong truck.
• Trigger alerts to pagers or PDAs when objects are mishandled — when an aircraft part
becomes overdue for maintenance or replacement, a manufacturing component is delivered
to the wrong line, a regulated drug is counterfeited, or a power tool is stolen off the job site.
• Provide data inputs into the company’s quality improvement systems, such as Six Sigma and
• Add greater insight to the total flow of corporate information, to continuously reduce inventory
and distribution costs, optimize internal processes, and increase the value of relationships
with suppliers and customers.
A business case study by the MIT Auto-ID Center found that RFID systems can improve demand
planning forecast accuracy for consumer packaged goods manufacturers by 10 to 20 percent,
reduce required inventory levels by 10 to 30 percent, and improve sales by 1 to 2 percent by
reducing out-of-stock conditions. A June 2005 research report released by Bear Stearns noted
that two early adopters of RFID had reported a 37 percent increase in efficiency in loading sea
containers, 9 to 14 percent reductions in out-of-stock conditions and an 18 percent drop in
17. Are You Ready for RFID?
Even small incremental improvements can yield substantial cumulative savings, suggesting that
RFID will soon be seen as much more than an unavoidable mandate.
In the 1970s, many companies grudgingly accepted bar coding and electronic data interchange
systems, because they were pressured into it by industry forces. Today, it would be hard to
imagine doing business without the advantages of UPC codes and electronic commerce — the
speedier and more accurate merchandise tracking, faster store checkouts, supply chain
efficiencies and insights about product movement.
RFID technology will not replace bar coding, but it holds even greater promise to improve
operations and reduce costs for all parties.
“The biggest issue is for companies to focus on what the broad and enterprise-wide repercussions
could be as new information flows and unexpected insights drive improvements in processes and
create new opportunities,” writes Bob Evans, editorial director of CMP (CMP.com) in an
Information Week special edition on RFID.
There are data challenges, to be sure, but the technology exists today to address those
challenges in a way that brings real business benefit. With the right data management and
business intelligence infrastructure to manage and use RFID data, this emerging technology could
soon be as indispensable as, and more valued than, the humble bar codes that we now take for
SAS is the market leader in providing a new generation of business intelligence software and
services. SAS solutions are used at more than 40,000 sites — including 96 of the top 100
companies on the FORTUNE Global 500® — to develop more profitable relationships with
customers and suppliers; to enable more confident decision-making; and to drive organizations
SAS solutions leverage the investments you’ve already made in existing systems and
applications, adding a layer of intelligence you can’t get anywhere else. For nearly three decades,
SAS has been giving customers around the world The Power to Know®. For more information,
visit us on the Web at www.sas.com