RFID Whitepaper for Steel Industry
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RFID Whitepaper for Steel Industry

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Here is a Whitepaper I wrote way back in 2011 for the the Steel Industry. The industry has only started capitalizing on the RFID Technology for Inventory Tracking and Realtime Location Tracking. I see ...

Here is a Whitepaper I wrote way back in 2011 for the the Steel Industry. The industry has only started capitalizing on the RFID Technology for Inventory Tracking and Realtime Location Tracking. I see a lot of potential in exploiting the usage of RFID Technology in our day to day operations.
Happy Reading..!

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RFID Whitepaper for Steel Industry RFID Whitepaper for Steel Industry Document Transcript

  • Confidential WHITEPAPER ON RRFFIIDD TTeecchhnnoollooggyy BBeeyyoonndd BBaarrccooddeess Pune, 20th Feb. 2011 ENETEK BUSINESS CONSULTING ENETEKENETEK Analytics to Simplify the World
  • Confidential Radio Frequency Identification (RFID) Executive Summary Radio Frequency Identification (RFID) is evolving as major technology enabler for supply chains around the world. Wal-Mart and the Department of Defense (DoD) along with some other major retailers now require their suppliers to begin RFID tagging pallets and cases shipped into their distribution centers. These mandates are about to impact some 200,000 suppliers globally. The Department of Homeland Security is looking to leverage RFID along with other sensor networks to secure supply chains and ensure port and border security. Pharmaceutical companies are already adopting the technology for anti-counterfeit measures. The automotive industry has been using the technology in manufacturing for decades. Now they are looking to extend its use to help with other mandates. Many major businesses already use RFID for better asset visibility and management. Companies looking to adopt RFID have to deal with a number of challenges, including: • Implementing an RFID solution that can interoperate with emerging standards for communication protocols, hardware platforms, and software interfaces. • Implementing an RFID solution that is cost effective, leverages their existing supply chain investments, and gives them clear a return on investment (ROI). • Preparing for the vast amounts of data generated by RFID. Although RFID technology is still developing, it is projected that RFID solutions will be widely deployed by 2011. Specifically, it is recognizes that RFID is a larger software issue than hardware issue. There are data issues concerning deploying the technology, reading the data, managing and integrating the data into the business flow, and scaling solutions. INTRODUCTION History of RFID The roots of RFID technology can be traced back to World War II. The Germans were using radar to warn of approaching planes. Although planes could be detected at great distances, it was impossible to determine if these planes were enemy or allied aircraft. The Germans discovered that if their pilots changed the angle of approach as they returned to base, it would change the signal reflected back. Effectively, this became the concept of modern day passive RFID systems where a tag reflects back the carrier to effectively backscatter modulate a response. Radar and RF technology systems continued to evolve throughout the 1950s and 1960s. It was discovered that an RF signal could be used to identify objects remotely. Companies began using this technology in anti-theft systems.
  • Confidential At the request of the Agricultural Department, Los Alamos also developed a passive RFID tag to track cows. This was the birth of animal ID or 125 kHz passive RFID to track dosages of medicine given to cows when they were ill. These backscatter systems were small glass tags injected under a cows skin. Other applications for these RFID systems were access control systems. As longer read ranges were needed, systems moved to the 13.56MHz high frequency spectrum which was unregulated and allowed interoperability in most parts of the world. These HF tags had faster data rates and allowed more tags to be used and identified in a shorter period of time. Today, 13.56MHz cards are used in access control, cashless payments, and asset management. In the early 1990's RFID moved up the spectrum again into the 900MHz spectrum offering longer read ranges and faster data rates. This technology is the technology driving the current Walmart mandates and supply chain applications. In 1999 the Auto-ID center was established at the Massachusetts Institute of Technology (MIT) with funding from Gillette, Procter and Gamble, and barcode standard orgnizations the Uniform Code Council and EAN International. The Auto-ID center tried to establish an "internet of things" where all items would be tagged with unique IDs and identified over the internet. The Auto-ID center eventually became EPCGlobal, an organization dedicated to commercializing and standardizing RFID technology. Today, RFID is used everywhere from cashless payment terminals to automatic vehicle identification (toll roads). RFID is beginning to take hold in non traditional markets and appliations. Embedded and enabled RFID technology is gaining foothold in vertical markets such as pharmaceutical and IT. Wal-Mart, Target, Tesco, and Albertsons have firmly backed the technology. New applications and uses are being discovered regularly. Radio-frequency identification (RFID) is an automatic identification method, relying on storing and remotely retrieving data using devices called RFID tags or transponders. RFID is a proven technology that's been around since at least the 1970s. Up to now, it's been too expensive and too limited to be practical for many commercial applications. But if tags can be made cheaply enough, they can solve many of the problems associated with bar codes. Radio waves travel through most non-metallic materials, so they can be embedded in packaging or encased in protective plastic for weatherproofing and greater durability. And tags have microchips that can store a unique serial number for every product manufactured around the world. Many companies have invested in RFID to get the advantages it offers. These investments are usually made in closed-loop systems—that is, when a company is tracking goods that never leave its own control. That's because some existing RFID systems use proprietary technology, which means that if company A puts an RFID tag on a product, it can't be read by Company B unless they both use the same RFID system from the same vendor. Another reason is the price. If a company tracks assets within its own four walls, it can reuse the tags over and over again, which is cost-effective. But for a system to
  • Confidential work in an open supply chain, it has to be cheap because the company that puts the tag on a case or pallet is unlikely to be able to reuse it. One issue that has prevented RFID from taking off until now is standards. There are well-developed standards for low- and high-frequency RFID systems, but most companies want to use UHF in the supply chain because it offers longer read range—up to 20 feet under good conditions. UHF technology is relatively new, and standards weren't established until recently. Another issue is cost. RFID readers typically cost $1,000 or more. Companies would need thousands of readers to cover all their factories, warehouses and stores. RFID tags are also fairly expensive—20 cents or more—which makes them impractical for identifying millions of, items that, cost only a few dollars. RFID is used for everything from tracking cows and pets to triggering equipment down oil wells. It may sound trite, but the applications are limited only by people's imagination. Increasingly, retail/CPG and pharma companies are looking to use RFID to track goods within their supply chain, to work in process and for other applications. RFID Technology An RFID system consists of a tag made up of a microchip with an antenna, and an interrogator or reader with an antenna. The reader sends out electromagnetic waves. The tag antenna is tuned to receive these waves. A passive RFID tag draws power from the field created by the reader and uses it to power the microchip's circuits. The chip then modulates the waves that the tag sends back to the reader, which converts the new waves into digital data. There are differences between low-, high-, and ultra-high frequencies, just as your radio tunes in to different frequencies to hear different channels, RFID tags and readers have to be tuned to the same frequency to communicate. RFID systems use many different frequencies, but generally the most common are low-frequency (around 125 KHz), high-frequency (13.56 MHz) and ultra-high-frequency or UHF (860-960 MHz). Microwave (2.45 GHz) is also used in some applications. Radio waves behave differently at different frequencies, so you have to choose the right frequency for the right application. Different frequencies have different characteristics that make them more useful for different applications. For instance, low-frequency tags use less power and are better able to penetrate non-metallic substances. They are ideal for scanning objects with high-water content, such as fruit, but their read range is limited to less than a foot (0.33 meter). High-frequency tags work better on objects made of metal and can work around goods with high water content. They have a maximum read range of about three feet (1 meter). UHF frequencies typically offer better range and can transfer data faster than low- and high frequencies. But they use more power and are less likely to pass through materials. And because they tend to be more "directed," they require a clear path between the tag and reader. UHF tags might be better for scanning boxes of goods as they pass through a dock door into a warehouse. It is best to work with a knowledgeable consultant, integrator or vendor that can help you choose the right frequency for your application. All the countries do not use the same frequencies, different countries have allotted different parts of the radio spectrum for RFID, and so no single technology optimally satisfies all the requirements of existing and potential markets. The industry has worked diligently to standardize three main RF bands: low
  • Confidential frequency (LF), 125 to 134 kHz; high frequency (HF), 13.56 MHz; and ultrahigh frequency (UHF), 860 to 960 MHz. Most countries have assigned the 125 or 134 kHz areas of the spectrum for low-frequency systems, and 13.56 MHz is used around the world for high-frequency systems (with a few exceptions), but UHF systems have only been around since the mid-1990s, and countries have not agreed on a single area of the UHF spectrum for RFID. UHF bandwidth across the European Union ranges from 865 to 868 MHz, with interrogators able to transmit at maximum power (2 watts ERP) at the center of that bandwidth (865.6 to 867.6 MHz). RFID UHF bandwidth in North America ranges from 902 to 928 MHz, with readers able to transmit at maximum power (1 watt ERP) for most of that bandwidth. Australia has allotted the 920 to 926 MHz range for UHF RFID technology. And European transmission channels are restricted to a maximum of 200 kHz in bandwidth, versus 500 kHz in North America. China has approved bandwidth in the 840.25 to 844.75 MHz and 920.25 to 924.75 MHz ranges for UHF tags and interrogators used in that country. Until recently, Japan did not allow any UHF spectrum for RFID, but it is looking to open up the 960 MHz area. Many other devices use the UHF spectrum, so it will take years for all governments to agree on a single UHF band for RFID. RFID can be used with sensors as some companies are combining RFID tags with sensors that detect and record temperature, movement and even radiation. The technology can also be used in the health- care sector. For instance, Belgium's University Hospital of Ghent has implemented a system that detects when a patient is having cardiac distress, and sends caregivers an alert indicating the patient's location (subscribers, see Belgium Hospital Combines RFID, Sensors to Monitor Heart Patients.) RFID Technology in Steel Industry Taking Product Tracking to the Next Level Over the next couple of years, radiofrequency identification (RFID) and the Electronic Product Code™ (EPC™) are poised to be among the most exciting and transformational technologies to influence the steel industry—with the potential to radically change the way global steel companies run their internal and external logistics. Leading steel companies should move as quickly as possible to adopt RFID technology to increase supply chain visibility, improve process security, generate cost savings and allow for steady business growth. Major benefits of adopting RFID technology include: Asset use: Radio-frequency identification speeds up the identification of tagged items, increasing throughput and optimizing the use of expensive handling equipment such as forklifts and cranes. Time gained can be so significant that it is possible to eliminate machines and reduce attendant capital investments and personnel costs. Operational efficiency: Radio-frequency identification improves operational efficiency in many ways including improved collaboration with trading partners, faster product localization and reduced manual effort. Safety and security: Automating product identification and tracking removes people from physically dangerous situations and averts the potential for product confusion. This in turn reduces risk exposure. Customer service: In addition to the range of benefits accrued by the steel industry as a result of RFID adoption, Technology experts anticipates that steel customers too will experience all the same benefits and will likely mandate the use of RFID if the industry does not take the lead. While it is clear that RFID applications can unlock unprecedented value for steel companies, the path to adoption will see some challenges. Technical and process hurdles to overcome include getting RFID to work on metallic
  • Confidential products, addressing internal resistance related to changing decades-old processes, meeting the need for repeated tagging because of the iterative nature of the production process and supporting the heterogeneous customer base. Despite the challenges, the benefits of RFID will contribute to each steel company’s effort to realize high performance. ThyssenKrupp Steel have set out to collaborate with other global steel manufacturers, customers, industry bodies, standardization organizations and RFID vendors, to create standards for the benefit of all. Using radio frequency enabled tags, these companies tracked the shipment and location of various parts and products within their supply chains. As an industry, Steel Mills faces a continuous need for decreased costs and increased efficiency. Implementing RFID within the supply chain will allow for immediate product analysis, thus saving valuable amounts of time and money. Pricing levels for RFID are still in the evaluation process. Costs are expected to decrease as implementation increases. Passive tags alone cost approximately 30 cents each and are expected to decrease to as little as 5 cents a tag. The RFID market is expected to grow from $1 billion in 2003 to more than $8 billion by 2010. With a value proposition that cuts costs, reduces errors, and increases efficiency; RFID technology is making a name for itself in the Steel industry. Supplementing existing bar code technology standards, we believe that RFID’s current and future applicability in the Steel industry realm will be tremendous. Vendors, Steel Mills, and distributors all have much to gain from this technology as it continuous to grow and changes the way Steel industry operates. This paper illustrates the potential RFID holds for steel companies and demonstrates how cooperation within the steel industry can lead to a standardization of IT-systems that is advantageous for the industry and its customers. Micro-Electro-Mechanical Systems (MEMS)? MEMS (micro-electro-mechanical systems, which are smaller than microscopic dust mites) have been used for several decades in everything from inkjet printers to accelerometers that deploy air bags in cars. A MEMS RFID tag contains micromechanical components that are expected to be rugged and easier to produce, and which could be attached directly to medical devices. Such a tag can withstand exposure to wide temperature ranges and gamma radiation. Mems-ID is developing a unique automated medical device tracking system that clearly addresses critical and immediate unmet needs in the healthcare industry. The patented Radio Frequency Identification (RFID) platform is based on Micro Electro Mechanical Systems (MEMS) technology which has sustainable competitive advantages - the ability to survive high temperatures and gamma irradiation. This allows the Mems-ID™ chips to be placed directly onto individual medical devices, such as surgical instruments, and withstand high-temperature autoclave and irradiation sterilization processes, whereas electronic RFID chips are usually destroyed by these processes.
  • Confidential RFID Printer-Encoders
  • Confidential ANTENNA TYPES The Cost of RFID Equipment The all-important question all companies need to know-is this technology going to show a saving over a reasonable period of time? Does it justify the purchase price, training expenses and implementation costs? Naturally this can only be answered in general terms and is arguable in Certain cases. In the past companies disregarded RFID because it was costly; however in recent years this technology has become far less expensive. Whether it has become cost effective for all companies is a current question. It is thought that until tag costs drop to below 10 cents (U.S), the benefits to industry will not be seen. This however; is being addressed by a new generation of RFID tags, which will reduce costs for manufacturers supplying to current RFID users WAL-Mart and Target. This particular tag, known as Gen 2, will hopefully get everyone to use the same technology standard and therefore increase volumes, thus decreasing costs. Bearing this information in mind it is understandable why many companies are hesitant to make the transition over to RFID. It is in effect a vicious circle because more industries will not use RFID until the price drops; but prices will not drop until there is a larger volume of usage. EPCglobal's goal is to drive adoption of RFID technology to the point where massive numbers of tags are made each year and the cost for silicon-based tags that can store a unique serial number drops to 5 cents per tag. Costs have fallen steadily over the past few years and will decline further as adoption ramps up. Most companies that sell RFID tags do not quote prices because pricing is based on volume, the amount of memory on the tag and the packaging of the tag (whether it’s encased in plastic or embedded in a
  • Confidential label, for instance). Generally speaking, a 96-bit EPC inlay (chip and antenna mounted on a substrate) costs from 7 to 15 U.S. cents. If the tag is embedded in a thermal transfer label on which companies can print a bar code, the price rises to 15 cents and up. Low- and high-frequency tags tend to cost a little more. Most UHF readers cost from $500 to $2,000, depending on the features in the device. Companies may also have to buy each antenna separately, along with cables. Antennae are about $250 and up. The price of readers is expected to fall as companies purchase them in large volumes. Low- and high- frequency readers range in price, depending on different factors. A low-frequency reader model (a circuit board that can be put into another device) can be under $100, while a fully functional standalone reader can be $750. High-frequency reader modules are typically $200 to $300. A standalone reader can be about $500. A fully functional RFID system cost depends on the application, the size of the installation, the type of system and many other factors, so it is not possible to give a ballpark figure. In addition to tag and reader costs, companies need to purchase middleware to filter RFID data. They may need to hire a systems integrator and upgrade enterprise applications, such as warehouse management systems. They may also need to upgrade networks within facilities. And they will need to pay for the installation of the readers. Not only do the readers need to be mounted, they need electrical power and to be connected to a corporate network. Cost The most expensive part of implementing an RFID system is the cost of the tags. The cost of the tags depends on how many are purchased. In the recent literature the cost of a tag ranges from 0.55 cents to 0.85 cents US. In their 2003 article, which represent a major RFID vendor, cited the cost of a tag at 0.55 cents US for 100,000 chips (24). In 2004 estimated the cost for book tags ranged from 0.40-0.70 cents/tag. Tags for discs, like CDs, DVDs and CD-ROMs are more expensive and generally cost about $1.20 USD/tag. It is possible for each tag to be printed with the library's logo on it for an additional cost. In 2003, Vancouver Public Library estimated that it would cost $3.6 million CDN to convert their collection to RFID. This conservative estimate includes necessary hardware, 2.4 million tags, and staff time to process the materials. However, the estimate does not include taxes and self-service checkout machines for the 20 branch libraries. Boss estimates for a large library with 250,000 items to convert the cost would be $333,500 USD. However he has costed labor at $8/hour, which is unreasonably low for libraries in Canada.
  • Confidential
  • Confidential RFID Implementation You need to deploy an RFID system, but don't understand the key risk factors affecting your project. What should you prioritize? How should you choose a partner? How can you evaluate RFID vendors effectively? What activities will determine the project's timeline? You are not alone. The RFID landscape can be confusing. With RFID middleware and hardware vendors claiming they can do it all and with traditional systems integrators angling to get some experience with the technology, the claims are often conflicting and difficult to verify. To navigate a successful RFID implementation you need to understand the key hazards: objectives, physics, process, systems and interdependencies. End users looking to adopt RFID today have a big advantage over their predecessors because the technology, software and know-how are improving. Follow these best practices to reduce project risk and ensure a successful implementation. Establish clear objectives First and foremost you should tackle your RFID project based on a clear set of objectives. Whether you are complying with a retailer mandate or deploying RFID to meet asset-tracking needs you must define your desired outcomes. This creates a framework for your decision-making. Trade off decisions will certainly arise in your process design, software selection, and RFID hardware and solution scope. A clear set of objectives helps keep your team focused on what is most important and separate "must have" from "nice to have" scope elements. Get the physics right The first point of success and therefore the first point of failure in any RFID system is tag and reader communication. If the reader cannot communicate with the tag, your RFID system will not work properly no matter how elegant your software and processes. Tags must be able to successfully transmit data to the readers for the RFID solution to work properly. However, the effectiveness of tag/reader communication is governed by RF physics. While most implementers will employ trial and error by waving a tag and asking "can you see it now," this invariably leads to poorly performing systems. You should employ a scientific approach to tag selection and reader optimization in order to maximize your read performance over time. Utilize a lab with FCC licensing and extensive RFID testing and field implementation experience to ensure proper equipment selection and deployment specifications. Get the process right If anyone suggests that you can implement an RFID solution without modifying your processes, you can be sure they are not experienced implementers. If you are not tagging product today, then you surely need to add processes to apply and verify tags and most likely to track movement of goods or assets. You should first base your process design on meeting your business objectives. The next step is to modify the new processes where appropriate to increase your read performance. Yes. Process can help improve your read performance. It is one of the variables you have at your disposal to ensure your RFID system can meet your objectives. You may also want to adjust your process to account for constraints of your RFID middleware to reduce implementation, time, complexity and cost. RFID technology ultimately should support your business objectives and processes and not the other way around. Get the systems right Users need to interoperate with your RFID software. Devices and enterprise systems need to integrate with your RFID software. The biggest delay in most RFID implementations can be attributed to RFID software configuration and integration. Once you have determined your hardware needs and
  • Confidential configuration specifications your RFID infrastructure should not be a bottleneck as long as you employ and experienced implementation team. However, from a systems standpoint, every RFID implementation is somewhat unique. RFID middleware also happens to be the least mature component of any RFID solution stack. End users should take great care designing their RFID systems architecture and selecting RFID middleware. No one RFID middleware vendor can meet all client needs well, so trade offs are an inevitable part of finding a good fit for your needs. As a testament to the variability of end user requirements, ODIN technologies has worked on RFID implementations with six different RFID middleware solutions, none of which could have worked well across all of the solutions. It is worth extra time to make sure that the RFID middleware you choose can meet your platform, workflow, rules, user interface, device support, data management and integration requirements. Get the interdependencies right For an RFID solution to work properly, the physics, process and systems need to work in concert. As mentioned above, process can be adjusted to improve read rates and systems should be selected with a clear understanding of process and device support requirements. These are just a few of the interdependencies. Another area to pay close attention to is the coordination of the physical installation. RFID systems tend to have complex bills of material for installation and requirements for power and network drops in addition to the software installation and training. You need to tightly coordinate the procurement and component delivery process with the site preparation work in order to ensure a smooth implementation and testing experience. Many end users have struggled through the actual deployment and testing process because a single item is missing which causes a delay in the implementation timeline. A best practice is to have a single organization oversee the entire implementation process so the installation and testing can go smoothly. For someone to understand all of the variables that can impact your deployment process you also need to work with someone experienced in multiple RFID designs and deployments and knowledgeable in RF physics, RFID middleware and processes. E.g. Costs of doing a "simple" Slap and Ship RFID implementation You can expect to spend $100,000 on external costs: Some of the common external costs a company can expect with a very simple slap and ship solution such as this one, look like this: Description Total One Thermal RFID Printer/encoder $5,000 Two Dock Door Read Points, includes 3 x EPC compliant, multi-protocol reader 8 x Bi-static 915MHz Antennas 4 x Industrial Strength Enclosure for Dock Doors Cables, UPS, Lights, Mounting Hardware, Ballards $15,000
  • Confidential Hardware Total: $20,000 RFID Middleware (varies by vendor): $30,000 External Services: $50,000 Total: $100,000 As for consumables, the 4 inch by 6 inch RFID Labels tend to cost around $0.40 a piece for quantities of 100,000 or less. Thermal printer ribbons are most likely part of the current budget. when you factor in the internal costs -- primarily labor -- the price tag rises to $500,000 - $750,000. Remember also that a slap and ship implementation probably is not nearly as complex or expensive as a full-integrated implementation of RFID into a company's supply chain. "Slap and ship" means affixing tags to cases or pallets in order to meet a mandate from Wal-Mart or some other organization. Costs for a broader solution would be significantly higher. N-Metal Technology and RFID N-Metal, a newly developed and innovative technology that gives commercially available and standards- compliant low-frequency Radio Frequency Identification (RFID) tags and readers the ability to communicate through metal-encapsulated environments. Metallic environments disturb all RFID systems, thus impeding effective communication between read/write modules and tags. The N-Metal technology overcomes this problem by the interposition of an inexpensive micro-adapter that enhances a metal-embedded RFID tag's ability to emit to and receive electromagnetic signals from a standard RFID reader device. Within a diversity of medical fields of use, standard read/write RFID tags can now be combined with a N- Metal adapter in such a way as to be hermetically encapsulated within medical devices - such as surgical instruments, sterilization cases, endoscopes, arthroscopes, and medical power tools, and will withstand aggressive and repeated autoclaving and cleaning. In this manner, specific sets of item-tagged instruments can themselves contain all the required information to trace the history of manufacture, inspection and revisions, data related to specific assembly, disassembly and cleaning instructions, as well as the relevant last surgery information that aids hospitals, sterilization departments and medical equipment providers to reduce costs, increase efficiency, while improving the control and distribution of their medical devices. The market for RFID in hospitals is predicted to increase to $8.8 billion by 2010, according to industry research, and as such the N-Metal technology offers substantial cost-savings to medical device manufacturers, OEM's and health care providers who are no longer restricted to the use of exclusive, proprietary through-metal RFID read/write tags for their medical device track-and-trace implementations, and can now use standards-compliant RFID tags and readers from a choice of multiple, competitive, and cost-efficient sources of supply.
  • Confidential RFID SYSTEM APPLICATION / USES Potential applications for RFID may be identified in virtually every section of industry, commerce, and services where data is to be collected. Principal areas of applications for RFID that can be currently identified include: • Transportation and logistics • Manufacturing and processing • Security A range of miscellaneous applications may also be distinguished, some of which are steadily growing in terms of numbers. They include: • Animal tagging • Waste management • Time and attendance • Postal tracking • Airline baggage reconciliation • Road toll management Some of the prominent specific applications include: • Electronic article surveillance - clothing retail outlets being typical. • Protection of valuable equipments against theft, unauthorized removal, or asset management. • Controlled access to vehicles, parking areas, and fuel facilities - depot facilities being typical. • Automated toll collection for roads and bridges - since the 1980s, Electronic Road-Pricing (ERP) systems have been used in Hong Kong. • Controlled access of personnel to secure or hazardous locations. • Time and attendance - to replace conventional "slot card" time keeping systems. • Animal husbandry - for identification in support of individualized feeding programmes. • Automatic identification of tools in numerically controlled machines - to facilitate conditional monitoring of tools, for use in managing tool usage, and minimizing waste due to excessive machine tool wear. • Identification of product variants and process control in flexible manufacturing systems. • Sport time recording. • Electronic monitoring of offenders at home. • Vehicle anti-theft systems and car immobilizers. Brand Authentication RFID provides powerful and unique brand protection both at item level and at pallet level. Specific applications are apparel verification, pharmaceutical verification, and mass ticketing. RFID is ideal for brand and royalty driven industries, providing brand protection down to individual items. RFID verification systems help reduce counterfeit merchandise across all industries. Cold Chain Cold chain describes packaged and processed products taht must remain cold. Anything that is temperature sensitive or has to stay within certain temperature requirements. RFID provides greater insight into conditions, temperature, and amount of time that products are in transit. Cold chain is
  • Confidential intimately tied to consumer safety, business liability and, frequently, the difference between profit and loss, cold chain management is a broadly deployable application requiring specialized technology and expertise. Cold chain RFID tags usually contain sensors interfaced to tags to record temperatures and real time stats, tracking the product at a more granular level. Asset Management Asset management is about tracking assets either in a retail environment, a supply chain, or in a service setting. Retail items can be automatically scanned when leaving the store to protect against stolen items. Casinos can actively track chips in real time while they are still on the table, preventing losses. Cashless Payments Cashless payments are transactions that occur remotely without cash with amounts being debited from an on card database. Each tag acts as a portable wallet to allow consumers to pay for goods and services. Blink technology from Chase is an example of this use. Mastercard Paypass is another example of this technology. Terminals are outfitted with RFID readers allowing consumers to pay for items without scanning magnetic stripes which wear out and provide little security. Passports RFID tags are being used in passports issued by many countries. The first RFID passports ("E- passport") were issued by Malaysia in 1998. In addition to information also contained on the visual data page of the passport, Malaysian e-passports record the travel history (time, date, and place) of entries and exits from the country. Standards for RFID passports are determined by the International Civil Aviation Organization (ICAO), and are contained in ICAO Document 9303, Part 1, Volumes 1 and 2 (6th edition, 2006). ICAO refers to the ISO 14443 RFID chips in e-passports as "contactless integrated circuits". ICAO standards provide for e-passports to be identifiable by a standard e-passport logo on the front cover.
  • Confidential RFID tags are included in new passports, beginning in 2006. The US produced 10 million passports in 2005, and it has been estimated that 13 million will be produced in 2006. The chips will store the same information that is printed within the passport and will also include a digital picture of the owner. The passports will incorporate a thin metal lining to make it more difficult for unauthorized readers to "skim" information when the passport is closed. Transportation payments Throughout Europe, and in particular in Paris in France (system started in 1995 by the RATP), Lyon and Marseille in France, Porto and Lisbon in Portugal, Milan and Torino in Italy, Brussels in Belgium, RFID passes conforming to the Calypso (RFID) international standard are used for public transport systems. They are also used now in Canada (Montreal), Mexico, Israel, Bogotá and Pereira in Colombia, Stavanger in Norway, etc. In Singapore, public transportation buses and trains employ passive RFID cards known as EZ-Link cards. Traffic into crowded downtown areas is regulated by variable tolls imposed using an active tagging system combined with the use of stored-value cards. RFID is used in Malaysia Expressways payment system. The name for the system is Touch 'n Go. Due to the name and design, one must touch the card for usage. Product tracking The Canadian Cattle Identification Agency began using RFID tags as a replacement for barcode tags. The tags are required to identify a bovine's herd of origin and this is used for tracing when a packing plant condemns a carcass. Currently CCIA tags are used in Wisconsin and by US farmers on a voluntary basis. The USDA is currently developing its own program. High-frequency RFID tags are used in library book or bookstore tracking, pallet tracking, building access control, airline baggage tracking, and apparel and pharmaceutical items tracking. High-frequency tags are widely used in identification badges, replacing earlier magnetic stripe cards. These badges need only
  • Confidential be held within a certain distance of the reader to authenticate the holder. The American Express Blue credit card now includes a high-frequency RFID tag. BGN has launched two fully automated Smartstores that combine item-level RFID tagging and SOA to deliver an integrated supply chain, from warehouse to consumer. UHF RFID tags are commonly used commercially in case, pallet, and shipping container tracking, and truck and trailer tracking in shipping yards. Wal-Mart and the United States Department of Defense have published requirements that their vendors place RFID tags on all shipments to improve supply chain management. Due to the size of these two organizations, their RFID mandates impact thousands of companies worldwide. The deadlines have been extended several times because many vendors face significant difficulties implementing RFID systems. In practice, the successful read rates currently run only 80%, due to radio wave attenuation caused by the products and packaging. In time it is expected that even small companies will be able to place RFID tags on their outbound shipments. Since January, 2005, Wal-Mart has required its top 100 suppliers to apply RFID labels to all shipments. To meet this requirement, vendors use RFID printer/encoders to label cases and pallets that require EPC tags for Wal-Mart. These smart labels are produced by embedding RFID inlays inside the label material, and then printing bar code and other visible information on the surface of the label. Automotive Microwave RFID tags are used in long range access control for vehicles. Since the 1990s RFID tags have been used in car keys. Without the correct RFID, the car will not start. In January 2003, Michelin began testing RFID transponders embedded into tires with the intention that after an 18 month testing period, the manufacturer would offer RFID-enabled tires to car makers. Their primary purpose is tire tracking in compliance with the United States Transportation, Recall, Enhancement, Accountability and Documentation Act (TREAD Act). As at August 2007 the progress has only extended to truck tires where rubber patches are affixed to the truck tire. An advanced version, the eTire includes a batteryless pressure sensor, is marketed by Michelin for truck tires. Interestingly
  • Confidential Michelin are required under the terms of their licence to offer this eTire system to all other tire manufacturers in November 2008. Car tires still present technical problems for embedding tags as the low cost of the tire means the cost of fixing the tags should be very cheap to be commercially viable. Starting with the 2004 model year, a Smart Key/Smart Start option became available to the Toyota Prius. Since then, Toyota has been introducing the feature on various models globally under both the Toyota and Lexus brands, including the Toyota Avalon (2005 model year), Toyota Camry (2007 model year), and the Lexus GS (2006 model year). The key uses an active RFID circuit allowing the car to detect the key approximately 3 feet from the sensor. The driver can open the doors and start the car with the key in a purse or pocket. Ford, Honda, and several other manufacturers use RFID-equipped ignition keys as anti-theft measures. Auto manufactures are among the leading users of RFID technology today. Most cars have an RFID reader in the steering column and a transponder in the key. If the ID in the key doesn't match the number the reader is looking for, the car won't stop. This system has greatly reduced auto theft. Auto companies also use RFID to track work-in-process, perfect just-in-time manufacturing, improve shipping accuracy, and manage inventory and warrantee information. Animal identification Implantable RFID tags or transponders can be used for animal identification. The transponders are more well-known as passive RFID technology on Microchip implant (animal). Keeping track of what fish is which can be difficult when there's only a few of them, and when you've got a whole aquarium featuring hundreds of identical swimmers it can be close to an idiot savant talent. Underwater world Singapore has streamlined the process by using Hitachi RFID dust to tag individual fish with a lightweight payload that lets aquarium visitors easily tell an arapaima fish from a pacu fish. When the fish swims past a sensor, the name of the fish is displayed. The system cost a little under £10,000 to set in place and will be extended soon to include their shark population. RFID in inventory systems An advanced automatic identification technology such as the Auto-ID system based on the Radio Frequency Identification (RFID) technology has two values for inventory systems. First, the visibility provided by this technology allows an accurate knowledge on the inventory level by eliminating the discrepancy between inventory record and physical inventory. In an academic study performed at Wal- Mart, RFID reduced Out of Stocks by 30 percent for products selling between 0.1 and 15 units a day. Second, the RFID technology can prevent or reduce the sources of errors. Benefits of using RFID
  • Confidential include the reduction of labour costs, the simplification of business processes and the reduction of inventory inaccuracies. RFID as Human implants Implantable RFID chips designed for animal tagging are now being used in humans. Night clubs in Barcelona, Spain and in Rotterdam, The Netherlands, use an implantable chip to identify their VIP customers, who in turn use it to pay for drinks. In 2004, the Mexican Attorney General's office implanted 18 of its staff members with the Verichip to control access to a secure data room. (This number has been variously mis-reported as 160 or 180 staff members.) Security experts are warned against using RFID for authenticating people due to the risk of identity theft. For instance a man-in-the-middle attack would make it possible for an attacker to steal the identity of a person in real-time. Due to the resource-constraints of RFIDs it is virtually impossible to protect against such attack models as this would require complex distance-binding protocols RFID in libraries Among the many uses of RFID technologies is its deployment in libraries. This technology has slowly begun to replace the traditional barcodes on library items (books, CDs, DVDs, etc.). However, the RFID tag can contain identifying information, such as a book’s title or material type, without having to be pointed to a separate database (but this is rare in North America). The information is read by an RFID reader, which replaces the standard barcode reader commonly found at a library’s circulation desk. The RFID tag found on library materials typically measures 50 mm X 50 mm in North America and 50 mm x 75 mm in Europe, and can also act as a security device, taking the place of the more traditional electromagnetic security strip. RFID has many applications in libraries that can be highly beneficial, particularly for circulation staff. Since RFID tags can be read through an item, there is no need to open a book cover or DVD case to scan an item. This would help alleviate injuries such as repetitive strain injury that can occur over many years. Since RFID tags can also be read while an item is in motion, using RFID readers to check-in returned items while on a conveyor belt reduces staff time. Furthermore, inventories could be done on a whole shelf of materials within seconds, without a book ever having to be taken off the shelf. In Umeå, Sweden, it is being used to assist visually impaired people in borrowing audiobooks. Malaysia, Smart Shelves are used to pinpoint the exact location of books in Multimedia University Library, Cyberjaya. A concern surrounding RFID in libraries that has received considerable publicity is the issue of privacy. Because RFID tags can in theory be scanned and read from over 350 feet in distance, and because RFID utilizes an assortment of frequencies, there is a legitimate concern over whether sensitive information could be collected from an unwilling source. However, advocates of RFID’s use in libraries will point out that library RFID tags do not contain any patron information,and that the tags used in the majority of libraries use a frequency only readable from approximately ten feet.There is much yet to be written and discussed on the issue of privacy and RFID, but it is clear that vendors need to be aware of this issue and develop improved technologies for secure RFID transactions.
  • Confidential Telemetry Active RFID tags also have the potential to function as low-cost remote sensors that broadcast telemetry back to a base station. Applications of tagometry data could include sensing of road conditions by implanted beacons, weather reports, and noise level monitoring. Supply Chain effectiveness with RFID The main benefit which RFID has to offer when it comes to the supply chain is in the area of security. Manufacturers know exactly where their products are at any stage in the internal and external supply chain. This has immense ramifications with regard to inventory management, product handling, and traceability. Not only that; but the read/write capability can also enable manufacturers to update information at various stages of process. Couple this technology with Best Practice Manufacturing and Logistics and the possibilities seem infinite. The Kearney report, which was focused on over-the-counter drug makers, estimated that RFID could reduce manufacturers’ distribution labor requirements by nine percent and inventory holding costs by six percent. RFID appears to be an invaluable development where supply chain optimization is concerned. Supply chain is vital for many businesses, both retail and manufacturing. Supply chain allows manufacturers to track raw materials, progress, and finished goods while collecting data to improve business processes and efficiency. RFID has the following advantages over other Auto ID technology: • Improved Visibility and Intelligence Into the Supply Chain • Reduce out-of-stocks • Proof of Delivery • Reduced Liability Distribution and logistics companies are looking at RFID technologies for both internal operational improvements and external benefits. Companies are tracking assets, such as containers, axles and chassis, to improve asset utilization and schedule routine maintenance. Many are also looking to use RFID to provide information to their customers on the location of products in transit. Eventually, logistics providers envision linking passive RFID tags on cases and pallets with active RFID tags on containers, and having that data communicated to GPS or satellite communication systems, enabling shippers to view the locations of their products as they move on land, on sea or in the air.
  • Confidential The EPCglobal Network mentioned previously will make organizations more effective by enabling true visibility of information about items in the supply chain. This will in turn enable companies to be more responsive to customer needs and increase agility of supply chain operation. Communication will be improved by use of web interfaces and fewer errors will occur. In this manner the flows of information along the supply chain will be improved by use of RFID which can only mean better efficiencies. Having more accurate, immediate information about the location of items, the history of items, and the number of items in the supply chain will enable organizations to be more responsive to customers and consumer needs through more efficient, customer-driven operations. Application in other sectors Today, CPG and retail companies are using RFID to track promotional displays, reduce out-of-stocks and improve shipping and receiving accuracy. RFID is also being used in the manufacturing industry by the Manufactures are using RFID to track work- in-process, perfect just-in-time manufacturing, improve shipping accuracy, and manage inventory and warrantee information. Pharmaceutical companies are exploring RFIDs potential in many areas, including improving supply- chain efficiencies, complying with government information-collection requirements, reducing counterfeiting, creating electronic pedigrees and ensuring public safety by making sure only legitimate drugs enter the supply chain. With RFID, new applications seem limited only by our collective imagination. New enabled and embedded applications continue to emerge. Examples of other applications are automotive assembly and tracking work in progress, employee monitoring, and package tracking.
  • Confidential Drawbacks Of RFID Technology Drawbacks of RFID technology often depend on what is being scanned/read. Because of the conductivity of metals, objects/products containing them may be hard to read. The tag itself may be comprised of an aluminum or copper foil antenna or silver ink. Other obstacles that may need overcoming are orientation of RFID tags and contents of scanned item: Contents of packages can dramatically reduce the read rate. Only 25% of the tags on shipping containers containing water filled bottles could be read. Rice filled jars had a higher reading rate (80.6%) Even empty boxes did not have a 100% read rate...The orientation of the tag does make a difference, especially when coupled with a filled package between it and the reader antenna. Tags facing outwards, towards the reader antenna, had the highest likelihood of a successful read. When tags for the boxes of water filled bottles were all facing downward, no tags were read. The three major drawbacks to implementing RFID are the expense, issues about patron privacy and the lack of standards. Privacy It is argued that current RFID systems are incompatible with patron privacy and should not be implemented and also concludes that libraries should not yet implement RFID systems until there are adequate government and industry standards. The current RFID tags used in libraries contain static information that can be read by unauthorized tag readers. This weakness can be exploited in two different ways that violate patron privacy: tracking and hotlisting. Tracking refers to the ability of an adversary to track an item by "correlating multiple observations of the book's RFID tag" .For example, "this personal checked out the same books as a known terrorist" (ibid). It is stated that the adversary is likely a government agent and that "if the bad guys are intent on screening you, the library is largely irrelevant". It is stated that the perceived privacy threat is a misconception based on the belief that “(1) that the tags contain patron information and (2) that they can be read after someone has taken the materials to home or office” (3). They do not address hotlisting, tracking or the use of unauthorized readers, which are legitimate concerns Lack of standards There are two International Organization for Standardization (ISO) standards that are relevant to RFID in libraries. ISO 15693 was the standard, however it was developed for supply chain systems, not library applications where each item is tagged. ISO 15693 set out various parameters including: physical characteristics, radio frequency power and signal interface, initialization and anti-collision and transmission protocol for RFID. ISO 18000-3 became the standard in September 2004. This standard set out parameters for the physical layer, anti collision and communication protocol at a 13.56 MHz, the frequency used for tags in libraries. Within this standard there are two modes that address different applications. These modes are not interoperable and not interfacing. Mode 1 is equivalent to ISO 15693. Mode 2 operates at a higher speed and has more memory available. For a more in depth discussion of the technical specifications and how they are still inadequate in protecting patron information see Molnar and Wagner's article.
  • Confidential RFID In Steel Industry Automatic identification, or Auto-ID, technologies such as radio-frequency identification (RFID) are increasingly important for streamlining production and logistics operations in almost every industry. Radio-frequency identification enables process automation, reducing the need for manual labor, speeding the completion of critical business processes and simultaneously increasing process security. Background After conducting several successful pilot projects using RFID for slab and coil logistics, ThyssenKrupp Steel is collaborating with steel customers from the automotive and industrial construction segments, other global steel producers, industry bodies and standardization organizations to leverage their knowledge and experience and to create standards of benefit to the entire industry. Implementing RFID in slab and coil logistics results in several benefits in the following key areas: Areas that could be improved by RFID • Better life cycle management • Reduced labor and time costs • Better exchange of resources • Quicker communication overall • Customs adherence • End to end planning • Reverse logistics • Inventory management • client inventory • Slash inventory write-offs • Shorten cash cycle • Asset utilization • Operational efficiency • Safety and security • Customer service • Reduce time to account for and track consigned inventory at multiple distributor location and • Traceability when launching in emerging markets • Communication in the area of expedition /delivery/due dates • Green logistics packaging recycling
  • Confidential Why standardization matters to the steel industry Standardization will be key to success and to the realization of the many benefits. It is paramount for the following reasons: Customer acceptance: Most steel companies sell their products (largely coils) and intermediary products (slabs and coils) to a uniform customer base in the automotive and industrial segments. If steel producers adopt diverging RFID solutions to identify slabs and coils, this places the onus on customers to work with multiple systems. Conversely, as has already occurred in the retail, military and pharmaceutical sectors, if the steel industry proposes anything other than a standardized approach, customers may simply mandate solutions, leading to unnecessary complexity, redundancy and cost for steel companies. Flexibility: By implementing a standard for solutions, the integration of new customer systems will be far easier than if a customized solution for every unique customer scenario were necessary. Standards also allow customers to choose among different suppliers and reduce their dependency on a single one. In other words, the necessarily tight integration of customer and supplier systems will not become an artificial trade barrier. Availability and cost: Using RFID for slab and coil logistics requires specialized solutions, which either do not yet exist in a production-ready form or which are at least more expensive than products used by other industries. While designing RFID products appropriate for handling steel is technically feasible, many vendors will only do so given sufficient sales volumes. As a result, the steel industry should focus on adopting a limited number of standardized solutions. No duplication of effort: There is no point in duplicating efforts and individually repeating technical mistakes. While the RFID applications described in this paper would provide benefit even if only used in one company, far greater benefits would be realized by standardizing systems across the entire supply chain, from producers to endues manufacturers. The steel industry must proactively develop standards for RFID-enabled slab and coil identification. A wait-and see attitude is strongly discourage because implementation times would increase—as would the costs and risks associated with responding to diverging customer requirements. It is for these reasons that we invite steel companies as well as steel industry customers to join and participate in this standardization effort. Opportunities for steel company participation may be found in the next article to be published specifically on RFID Technology for Steel Industry, by the author Mr.Unnikrishnan. What strategy should Steel Manufacturers adopt with regard to RFID Companies should educate themselves fully on all aspects of this technology and emerging trends. 1. Steel Mills and its entities interaction-A proactive cohesive strategy has to be adopted with mills as to the use of the technology. 2. Existing Business Software-A complete review of existing systems being used and what needs to be integrated. 3. Communication-This should be across all levels. 4. Supply Chain Review- A review of the existing supply chain and how it operates. RFID works best from an economical perspective in a closed system type of arrangement. It is also more applicable where there is multiple use of the tag throughout the supply chain. As with anything this technology is not going to turn a business around if there are already inherent flaws in the system. In fact the potential results could be disastrous. For this reason it is very important that the company wishing to implement RFID knows their own business supply chain and software capabilities well.
  • Confidential But embedded tags used in the production stage would also allow manufacturers to go beyond compliance. “RFID allows for individual product pedigree—companies can trace each product, not just batches of product,”. We also identify several aspects of the manufacturing process that can be improved by RFID. For successfully using RFID will need a very specific business plan. Increasing profits with the technology may require manufacturers to adopt a strong digital infrastructure using the following strategies: • Adopting a cohesive strategy for interacting with business units. • Defining an accountability chain and allowing for external and internal communication. • Having a complete hardware solution—quality management must be integrated with enterprise systems, and those need to integrate with products at an individual level. • Creating a service support structure for steel mills. Future of RFID Assessing RFID's Future Many regard RFID as a technology in its infancy with as yet untapped potential. This assessment seems true. The technology has many benefits to offer. Its stumbling point seems only to be a variety of issues outside the technology itself: marketing problems, false promises, questions over intellectual property and a lack of standards. Industry members, however, have become painfully aware of these problems and are trying to do something to remedy the mistakes of the past. If they are able to successfully unify the industry with standards, deliver on future promises, and convince end users of the technology's benefits, then RFID's future looks favorable. With the adoption of the EPC Class 1 Gen 2 standard, RFID is poised for worldwide growth with large players driving adoption and standards. With more and more companies adopting the technology, RFID is poised to grow at a torrid pace both domestically and worldwide. EE Times reports that the production of RFID tags is expected to grow 25 fold by 2010 reaching 33 billion tags from the current 1.6 billion. Currently, most individuals experience 2-3 daily contact points for the technology with the number expected to grow to 5-6 contact points. Currently, these contact points are mostly through cashless payment credit cards, vehicle identification and access control. Moving forward, RFID technology is being adopted in non-traditional embedded and enabled solutions such as counterfeit protection, asset verification, and customer loyalty. RFID technology will be embedded in passports, servers, printers, and consumer products. Item level tracking will become more and more prevalent. Casino chips will include RFID tags that can quickly identify the amount and number of chips on the table. Printers will automatically verify that ink cartridges are not counterfeits. New and exciting applications will continue to surface while RFID becomes seemlessly integrated with our lives.
  • Confidential Is RFID Technology Future Proof? This is another important consideration. The last thing any manufacturer wants to do is implement a system that becomes obsolete in a short space of time. The fact that RFID has actually been around for quite a long period but has only become economically viable recently, lends it some longevity. Imagine a world where your pantry reminds you that you have forgotten to take your medication and your refrigerator tells you it is running low on milk and the butter is past the use-by date. Imagine you are about to leave home and your handbag announces “you forgot your keys” and that you have very little cash. Fantasy? No! Each of these is just part of the world of RFID and many of these have gone beyond the drawing board and are already in testing and production. When, with mass production, their price eventually reduces to perhaps a cent, all products are likely to have an RFID instead of a barcode and retailers will be able to electronically "poll the shelf" to keep track of everything from cans of Coke to packets of Pringles. You too will be able to “poll” your pantry and indeed your entire house. You will know exactly what you own, where everything is, and be reminded if anything is getting low. Imagine being able to locate your car-keys, spectacles, and remote control. Another important point to note is standards, which are emerging based around RFID technology; this also implies that it will not be outdated in a hurry. With regard to the healthcare sector the FDA (Food and Drug Authority) has proposed an industry timeline calling for full implementation of RFID in the pharmaceutical supply chain, including pallet and case labeling by 2007. EPCglobal Inc. is an organization, which establishes and promotes technology standards and it finalized the UHF Generation 2 standard in December 2004. One method of installation, which is relatively future-safe, is a platform independent RFID system, which accepts data from any application and uses a variety of data collection means. This could prove to be the best option for those beginning to use RFID in the interim. Conclusion RFID is a Technology which has finally come of age. Early implementation in the organization is the key to success where RFID is concerned. It may take a few years to go live but any company, which has done its groundwork, should reap the benefits. RFID projects are complex. A typical enterprise software implementation must coordinate processes, applications and people. A typical RFID implementation includes those elements and adds a physical device layer, a sophisticated wireless communication network governed by RF physics, and impacts to physical facilities and material flows. As you see now, it is not limited to Wal-Mart or the Department Of Defence (although it is precisely due to the mandates issued by these venerable Organization that RFID Technology has received a boost today). RFID has myraid possibilities and use and can be applied in more & more places today. However, by leveraging experienced partners and understanding the key elements of a successful RFID program, you can establish a sound foundation for a successful RFID implementation.But effective implementation of RFID requires a good understanding of the Technology, what it can do & what it cannot do. This can be achieved only by suitable training.
  • Confidential About the Author Mr. Unnikrishnan completed Post Graduation Degree Program ,with MBA & E- Business from an Asian Business School. He assumed senior responsibility with ENETEK, for the Asia Pacific & Middle East Region, and is heading Operations & Business Development in the Supply Chain & Analytics Division and based out of Pune, India. The Organization is HQ in France with Branch offices in Turkey & India and deals in the Management & Supply Chain Consultancy & Financial Investments Consultancy. He is also a part of the Management Team of Orcades Commodities SA, Geneva, Switzerland based firm which is into Financial Investments & Energy Pricing Consultancy. Unnikrishnan, is an expert energizing professional, who has lead several MNC Organizations to higher levels of performance & Customer Satisfaction in the Logistics & SCM Sector, by using his extensive Global Exposure & Qualifications in International Business, and other Corporate functions for developing & implementing the right IT- driven Supply Chain Breakthrough Strategies. He has worked in various projects related to Corporate Strategy, International Business, Supply Chain & Logistics, Operational Excellence, Cost Optimization, Investment Plan Re-engineering, Business Process Modelling, Network Design & Optimization, Simulation etc., and has evolved & establish SCM & Logistics systems leading to better Customer experience & Operational excellence. Moreover, he was brought up and lived in Middle East and worked in Europe and Turkey and worked with several Cross-functional Teams from Europe, North America and Asia and is aware of the cultures, tradition and way of life. He is also a regular contributor to several magazines and author of several articles. He has a passion for driving to the Next Generation of Virtual, Intelligence-based, Customer Driven Supply Chain. You can contact him on: uk.apac@enetek.eu, Cell:+919960626888 About ENETEK ENETEK S.A.R.L is a well established, Supply Chain Operations & Consultancy firm, based out from France. It has been successfully providing Supply Chain Analytics, Designing & Modeling Consultation in the areas of Current & Future Distribution Networks, Inventory Mgt. & Optimization, Demand Mgt. & Forecasting, Warehousing/DC Mgt., and Strategic Planning & Operations Excellence etc. since its inception in 2004, and located at Guérard, France. Being an Global Supply Chain & Logistics - Analytics & Consultancy firm, Enetek is primarily dedicated to leading its Clients to Next level of Supply Chain effectiveness, by using the State – Of – The - Art- Technology in Supply Chain Optimization, Simulation, Forecasting Tools & Methodologies. Our proven Track record, expertise & excellent Service offers the tools you need for Supply Chain competency, looking at the current Scenario of shrinking Product Life Cycles, Ongoing Cost pressures, Customer Demand Variability, Supply Chain Complexities & Visibility, With huge impact on Service Level, Revenues & Market Shares. ENETEK has a Strong presence & a broad experience in the Europe, and willingness to grow in the fast Developing Countries. It has strong partnership in Turkey, Brazil, US and India. Its Team comprises of Experts with vast experience in Various Industry and respective Supply Chain fields, and also Academic Experts & Research Professors from renowned Universities. ENETEK’s cliental includes, Hewlett-Packard, Proctor & Gamble, Dell, Johnson & Johnson, Toyota, Safran Aeronautical, Arcelor-Mittal, Conocco Philips, Orange, Idom. We have worked on several Projects on Distribution Reengineering, Spare Parts Mgt., Supply Chain Design, Planning Optimization, Investment Plan reengineering, and Network Design & Optimization. For more Information about our Company, Please visit us at www.enetek.eu
  • Confidential © Copyright ENETEK 2006 | 8, rue de Prémol, Montbrieux, 77580 Guérard Tél : 01 60 70 22 53 – info@enetek.eu | www.enetek.eu ENETEKENETEK ENETEKENETEK BUSINESS CONSULTING Analytics to Simplify the World Business Process Modelling (BPM) Management Planning Supply Chain Analytics Operations Excellence Distribution Reengineering Cost Reduction Spare Parts Mgt. Supply Chain Design Planning Optimization Investment Plan Reengineering Network Design & Optimization Inventory/Stock Optimization Flash Diagnostics Book1–Main presentation • Introduction • Basicbeliefs • Casestudies • Potential approaches Book3–Sampleend products • 4-week diagnostic • 8-week diagnostic • Supplychainblueprint • Pilot planningandexecution Book4–Additional information • References, experts, andcase studies • Best practiceoverview • SCMITapplications Book2 –Detailed processapproachmodules 0. Supplychainmanagement diagnostic 1. Service-level management 2. Demand management 3. Productionmanagement 4. Supplymanagement 5. Distributionmanagement 6. Integratedplanning 7. ITArchitecture, selection, andintegration 7. 1eSCMandmSCM 8. Workingcapital management 9. Changeandproject management 10. Organizationand performance management 11. DC/Plant quick scan 12. SKUrationalization ENETEKSUPPLY CHAINTOOLKIT Tableof contents Book1–Main presentation • Introduction • Basicbeliefs • Casestudies • Potential approaches Book3–Sampleend products • 4-week diagnostic • 8-week diagnostic • Supplychainblueprint • Pilot planningandexecution Book4–Additional information • References, experts, andcase studies • Best practiceoverview • SCMITapplications Book2 –Detailed processapproachmodules 0. Supplychainmanagement diagnostic 1. Service-level management 2. Demand management 3. Productionmanagement 4. Supplymanagement 5. Distributionmanagement 6. Integratedplanning 7. ITArchitecture, selection, andintegration 7. 1eSCMandmSCM 8. Workingcapital management 9. Changeandproject management 10. Organizationand performance management 11. DC/Plant quick scan 12. SKUrationalization ENETEKSUPPLY CHAINTOOLKIT Tableof contents Book1–Main presentation • Introduction • Basicbeliefs • Casestudies • Potential approaches Book3–Sampleend products • 4-week diagnostic • 8-week diagnostic • Supplychainblueprint • Pilot planningandexecution Book4–Additional information • References, experts, andcase studies • Best practiceoverview • SCMITapplications Book2 –Detailed processapproachmodules 0. Supplychainmanagement diagnostic 1. Service-level management 2. Demand management 3. Productionmanagement 4. Supplymanagement 5. Distributionmanagement 6. Integratedplanning 7. ITArchitecture, selection, andintegration 7. 1eSCMandmSCM 8. Workingcapital management 9. Changeandproject management 10. Organizationand performance management 11. DC/Plant quick scan 12. SKUrationalization ENETEKSUPPLY CHAINTOOLKIT Tableof contents 1. CUSTOMERSERVICEMANAGEMENT– INDICATORSOFPERFORMANCE) Performance Processes Poor Average Good/Leading-edge Order Penetration Point Not set tomatchsupplyand demand characteristics, leadingto high complexity costs Some assemblyand geographical postponement tominimizecosts and complexity Tailoredbyproduct/ customer segmentand make-to-stockvs. make-to- order policies TacticalOrder Management Mainlymanual dataentry Mainlypush-based deliveries Inflexible order lead times and sizes, and delivery timing MainlyFIFOorder processing Some customer integration; minimal clericalorder handling Mostlyfixed order lead times Order sizes and delivery timingdrivenmainlyby production capabilities Mixedresponse to “flash” orders Fullcustomer integration; no clericalorder handling Order lead times andsizes, and deliverytiming tailored to minimizeTCOfor both producer and customer FlexibleFGsupplychainfor efficientresponse to “flash” orders Order Processing Infrastructure Mainlypaper and phone based Nosupplychain transparency(i.e., order visibility in producer’s supplychain) Some EDI penetration Minimal/no supplychain transparency PrimarilyEDI- or on-line- basedinterface for order processing,problem resolution, andpayment processing Keycustomershave full visibilityinto producer’s supplychain 1. CUSTOMERSERVICEMANAGEMENT– INDICATORSOFPERFORMANCE) Performance Processes Poor Average Good/Leading-edge Order Penetration Point Not set tomatchsupplyand demand characteristics, leadingto high complexity costs Some assemblyand geographical postponement tominimizecosts and complexity Tailoredbyproduct/ customer segmentand make-to-stockvs. make-to- order policies TacticalOrder Management Mainlymanual dataentry Mainlypush-based deliveries Inflexible order lead times and sizes, and delivery timing MainlyFIFOorder processing Some customer integration; minimal clericalorder handling Mostlyfixed order lead times Order sizes and delivery timingdrivenmainlyby production capabilities Mixedresponse to “flash” orders Fullcustomer integration; no clericalorder handling Order lead times andsizes, and deliverytiming tailored to minimizeTCOfor both producer and customer FlexibleFGsupplychainfor efficientresponse to “flash” orders Order Processing Infrastructure Mainlypaper and phone based Nosupplychain transparency(i.e., order visibility in producer’s supplychain) Some EDI penetration Minimal/no supplychain transparency PrimarilyEDI- or on-line- basedinterface for order processing,problem resolution, andpayment processing Keycustomershave full visibilityinto producer’s supplychain LEVERAGEPOINTS, ANALYSESANDTOOLS: PLANNINGANDORDERING Leveragepoint Analysis Tools •Decrease order leadtimes •Increase flexibility of safety stocks •Order lead timevs. total timeof order todelivery •Contribution of thedifferent lead time elements –Net demand planning –Production planning and MRP breakdown –Call-off of supplies –Production time •Decouple andreduce theminimum leadtimes thesupply chaincan offer (e.g., increaseflexibilityof production workforce) •Introducea two-step production planning fully exploiting the reduced anddecoupledleadtimes: –Order on demand: fixed quantity, variableproduction schedule –Order with fixedproductionplan: variablequantity, fixedproduction windows •Amount of identical SKUs are storedin different warehouses (product, packaging, country version) •Amount of SKUs, partially made up of identical rawandpackaging materials/semifinished products? •Concentrate identical SKUs inone warehouse •Allowfreeflowof information and products betweendifferent warehouses to have only onesafety stock perSKU •Designproduct insucha way that differentiationbetweendifferent products takes place inthe last process step only (lateidentification) LEVERAGEPOINTS, ANALYSESANDTOOLS: PLANNINGANDORDERING Leveragepoint Analysis Tools •Decrease order leadtimes •Increase flexibility of safety stocks •Order lead timevs. total timeof order todelivery •Contribution of thedifferent lead time elements –Net demand planning –Production planning and MRP breakdown –Call-off of supplies –Production time •Decouple andreduce theminimum leadtimes thesupply chaincan offer (e.g., increaseflexibilityof production workforce) •Introducea two-step production planning fully exploiting the reduced anddecoupledleadtimes: –Order on demand: fixed quantity, variableproduction schedule –Order with fixedproductionplan: variablequantity, fixedproduction windows •Amount of identical SKUs are storedin different warehouses (product, packaging, country version) •Amount of SKUs, partially made up of identical rawandpackaging materials/semifinished products? •Concentrate identical SKUs inone warehouse •Allowfreeflowof information and products betweendifferent warehouses to have only onesafety stock perSKU •Designproduct insucha way that differentiationbetweendifferent products takes place inthe last process step only (lateidentification) LEVERAGEPOINTS, ANALYSESANDTOOLS: PLANNINGANDORDERING Leveragepoint Analysis Tools •Decrease order leadtimes •Increase flexibility of safety stocks •Order lead timevs. total timeof order todelivery •Contribution of thedifferent lead time elements –Net demand planning –Production planning and MRP breakdown –Call-off of supplies –Production time •Decouple andreduce theminimum leadtimes thesupply chaincan offer (e.g., increaseflexibilityof production workforce) •Introducea two-step production planning fully exploiting the reduced anddecoupledleadtimes: –Order on demand: fixed quantity, variableproduction schedule –Order with fixedproductionplan: variablequantity, fixedproduction windows •Amount of identical SKUs are storedin different warehouses (product, packaging, country version) •Amount of SKUs, partially made up of identical rawandpackaging materials/semifinished products? •Concentrate identical SKUs inone warehouse •Allowfreeflowof information and products betweendifferent warehouses to have only onesafety stock perSKU •Designproduct insucha way that differentiationbetweendifferent products takes place inthe last process step only (lateidentification)
  • Confidential References The whitepaper has been published with references from certain websites like RFID, - Thyssenkrupp, - EPC Global Disclaimer The information contained in this document represents the current view of RFID Technology on the overview discussed as of the date of publication. Because the ENETEK Supply Chain Analytics must respond to changing market conditions, it should not be interpreted to be a commitment on the part of ENETEK, and ENETEK cannot guarantee the accuracy of any information presented after the date of publication. This White Paper is for informational purposes only. ENETEK, MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS DOCUMENT. Complying with all applicable copyright laws is the responsibility of the user. Without limiting the rights under copyright, no part of this document may be reproduced, stored in or introduced into a retrieval system, or transmitted in any form or by any means (electronic, mechanical, photocopying, recording, or otherwise), or for any purpose, without the express written permission of ENETEK. ENETEK may have trademarks, copyrights, or other intellectual property rights covering subject matter in this document. Except as expressly provided in any written license agreement from ENETEK , the furnishing of this document does not give you any license to these , trademarks, copyrights, or other intellectual property. Unless otherwise noted, the example companies, organizations, products, domain names, e-mail addresses, logos, people, places and events depicted herein are fictitious, and no association with any real company, organization, product, domain name, email address, logo, person, place or event is intended or should be inferred. © 2010 ENETEK S.A.R.L. All rights reserved. All other trademarks are property of their respective owners. Homepage: www.enetek.eu © Copyright Enetek Business Consulting Europe (Paris): Thibault QUIVIGER President & CEO Thibault.quiviger@enetek.eu Tel: +33 6 5001 7788 Turkey, Middle East (Istanbul): Tolga Yanasik Vice President- ME Tolga.yanasik@enetek.eu Tel: +90 532 667 6595 Asia Pacific (Bombay, India) Unnikrishnan MD –APAC Uk.apac@enetek.eu Tel: +91 99 6062 6888