Department of Defense RFID Mandate for Suppliers


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Department of Defense RFID Mandate for Suppliers

  1. 1. Guide Department of Defense RFID Mandate for Suppliers Introduction 1 What is the DOD Mandate A Guide from Catalyst International for RFID? 2 When Did the DOD Issue the Mandate? 2 Why is the DOD Issuing a INTRODUCTION Mandate for RFID? 2 The Department of Defense (DOD) has set a mandate for all of its suppliers for the What is the History of the DOD and RFID? 2 use of RFID (Radio Frequency Identification) technology. Many suppliers to the DOD are not aware of the policy or do not understand its impact on their Who Is Affected By the Mandate? 3 organization. When Will Suppliers Need to Be Compliant? 3 This guide from Catalyst International was developed to inform and educate suppliers on the mandate and assist suppliers in determining the impact of the How Does the Technology Work? 6 mandate and when planning should begin for the implementation of RFID based on DOD supplier class. What Happens If a Supplier Does Not Comply? 6 We have developed a few key questions that will help guide you in the process: What Do Suppliers Need to Do to Be Compliant? 6 s Are you a supplier to the DOD? How Can Suppliers Receive Help with Implementation? 7 s Are you a class I, class II, class VI or class IX supplier? s Do you currently ship to the San Joaquin, California or Susquehanna, Where Can I Receive More Information? 8 Pennsylvania distribution depots? s Do you know that suppliers to the DOD will be required to support an RFID tag Summary 8 mandate as of January 2005? s Do you understand the requirements of the RFID mandate? s Do you understand how RFID technology works? The format of the guide is a series of questions and answers that will benefit you in understanding the importance of preparing for this technology change in your supply chain. © 2004 Catalyst International, Inc.
  2. 2. WHAT IS THE DOD MANDATE FOR RFID? The DOD is requiring all of its suppliers to incorporate the use of RFID technology using a phased approach that requires some classes of supplies to be compliant by January 2005 and all other classes of supplies to be compliant by January 2006. Companies that sell products to the DOD soon will have to comply with a new condition of doing business: wireless inventory tagging. WHEN DID THE DOD ISSUE THE MANDATE? In October 2003, the DOD instituted the policy requiring its suppliers to install RFID tags on individual parts and pallets by 2005. In July 2004, the DOD published its final policy guidelines for the use of RFID technology within its supply chain. WHY IS THE DOD ISSUING A MANDATE FOR RFID? RFID chips, or tags, contain identification information that can be wirelessly passed on to a reader allowing, for example, the contents of a shipping container to be identified without opening it. The military expects to achieve many benefits from using passive RFID technology on pallets and cases; most of these benefits are the same as those that businesses hope to realize. Better visibility of the materials in the supply chain will allow the DOD to reduce safety stocks. More accurate and timely data will enable the DOD to more accurately forecast consumption of supplies, so it can buy only what it needs and make sure the supplies arrive where and when they are needed. By enabling data to be captured without manual scanning, the DOD expects to reduce the number of people needed to handle goods and redeploy those people to more critical tasks. Also, better visibility and new security tags should make it possible to reduce the number of items that are lost or stolen while in transit. WHAT IS THE HISTORY OF THE DOD AND RFID? Today the department already is among the largest users of RFID technology. The department uses active RFID tags - which contain their own power supplies - to manage significant assets such as containers full of munitions. The new edict calls for suppliers to use simpler, passive RFID tags, which require a monitoring device to power the tag. 2
  3. 3. WHO IS AFFECTED BY THE MANDATE? The policy requires passive RFID tagging at the case, pallet and container level for all new solicitations issued on or after October 1, 2004 for the delivery of material on or after January 1, 2005 for certain classes, January 1, 2006 for other classes, and January 1, 2007 for unit pack items (UID). The DOD has developed a Defense Federal Acquisition Regulation (DFAR) clause that will contractually require suppliers to affix passive RFID tags to material at the case, pallet and item packaging for unique identification (UID) items in accordance with Attachment 3 of the July 30, 2004 policy for contracts issued on or after October 1, 2004 for delivery of material on or after January 1, 2005. This policy will also be incorporated into the next update of the DOD Supply Chain Material Management Regulation (DOD 4140.1-R), the Defense Transportation Regulation (DOD 4500.9-R) and the Military Standard 129. WHEN WILL SUPPLIERS NEED TO BE COMPLIANT? The tags will be phased in gradually according to “procurement methods, classes/commodities, location and layers of packaging for passive RFID,” with the tags added by the manufacturer or vendor. By January 2005, two distribution depots—one in San Joaquin, California, and one in Susquehanna, Pennsylvania—are designated to receive a variety of tagged goods, including clothes and rations. Suppliers must attach passive RFID tags to all individual cases, all cases packaged within a pallet and all pallets of packaged troop rations, clothing, individual equipment and tools, personal items and weapons systems repair parts and components shipped to the two DLA distribution centers. Beginning January 1, 2006, suppliers will be required to tag cases and pallets of subsistence and comfort items, packaged petroleum, lubricants, oils, preservatives and chemicals, construction and barrier material, ammunition of all types, pharma- ceutical and medical material shipped to 32 depots throughout the United States and the two distribution centers. Beginning January 1, 2007, all commodities shipped to all DOD locations should be tagged. 3
  4. 4. The following table provides more details regarding the classes, dates and shipping locations. CLASS January 2005 January 2006 January 2007 Class I Subclass – Packaged RFID Enable: RFID Enable: RFID Enable: Operational Rations & Packaged Pallet Pallet UID Item Food Exterior Container Exterior Container Shipping Container Shipping Container For Shipping To: Class II – Clothing, individual All Locations equipment, tentage, organizational For Shipping To: For Shipping To: tool sets and kits, hand tools, and San Joaquin, CA 32 Depots administrative and housekeeping Susquehanna, PA supplies and equipment Class VI – Personal demand items such as snack foods, beverages, cigarettes, soap, toothpaste, writing material, cameras, batteries, and other nonmilitary sale items Class IX – Repair parts and components to include kits, assemblies and subassemblies (reparable or nonreparable) which are required for maintenance support of all equipment Class I – Subsistence & Not applicable RFID Enable: RFID Enable: Gratuitous Health & Comfort Items Pallet UID Item Class III – Petroleum fuels, Exterior Container Shipping Container For Shipping To: lubricants, hydraulic and insulating All Locations oils, preservatives, liquid and gas, For Shipping To: bulk chemical products, coolants, San Joaquin, CA de-icer and antifreeze compounds, Susquehanna, PA components and additives of 32 Depots petroleum and chemical products, and coal Class IV – Construction material including installed equipment and all fortification and barrier material Class V – Ammunition of all types (including chemical, radiological, and special weapons), bombs, explosives, mines, fuses, detonators, pyrotechnics, missiles, rockets, propellants, and other associated items Class VII – Major end items such as launchers, tanks, mobile machine shops, and Medical material, including repair parts peculiar to medical equipment 4
  5. 5. The 32 depots include the following: USMC Marine Corps Maintenance Depot, Albany, GA Marine Corps Maintenance Depot, Barstow, CA USA Army Maintenance Depot, Anniston, AL Army Maintenance Depot, Corpus Christi, TX Army Maintenance Depot, Red River, TX Army Maintenance Depot, Tobyhanna, PA USTRANSCOM Air Mobility Command Terminal, Charleston Air Force Base, Charleston, SC Air Mobility Command Terminal, Dover Air Force Base, Dover, DE Air Mobility Command Terminal, Naval Air Station Norfolk, Norfolk, VA Air Mobility Command Terminal, Travis Air Force Base, Fairfield, CA USAF Air Logistics Center, Ogden, UT Air Logistics Center, Oklahoma City, OK Air Logistics Center, Warner Robbins, GA USN Naval Aviation Depot, Cherry Point, NC Naval Aviation Depot, Jacksonville, FL Naval Aviation Depot, North Island, San Diego, CA DLA Defense Distribution Depot, Albany, GA Defense Distribution Depot, Anniston, AL Defense Distribution Depot, Barstow, CA Defense Distribution Depot, Cherry Point, NC Defense Distribution Depot, Columbus, OH Defense Distribution Depot, Corpus Christi, TX Defense Distribution Depot, Ogden, UT Defense Distribution Depot, Jacksonville, FL Defense Distribution Depot, Oklahoma City, OK Defense Distribution Depot, Norfolk, VA Defense Distribution Depot, Puget Sound, WA Defense Distribution Depot, Red River, TX Defense Distribution Depot, Richmond, VA Defense Distribution Depot, San Diego, CA Defense Distribution Depot, Tobyhanna, PA Defense Distribution Depot, Warner Robbins, GA 5
  6. 6. HOW DOES THE TECHNOLOGY WORK? The DOD will use two types of RFID tags: (1) Active: Contains an internal power source, enabling the tag to hold more data and has a longer “read” range and (2) Passive: Does not contain any power source, holds a minimum of data and has a shorter “read” range. Initially the tags will be used to identify the bulkiest items. Their current use of active tags is usually on large or valuable pieces of equipment or consolidated shipments— that is ocean containers or air pallets. The initial passive RFID implementation will be at the case or warehouse pallet level where inexpensive tags will facilitate distribution processes and perhaps provide added granularity to item level visibility for some specific commodities. A recent memo from the DOD outlines the phased approach for the integration of RFID. The first appendix to the memo describes the requirements for the use of active tags. A second appendix describes the requirements for passive tags. The DOD plans to use passive UHF tags operating between 860 MHz and 960 MHz with a minimum read range of three meters (about 9 feet). Until EPC UHF Gen 2 tags and readers are available, the DOD will accept Class 0 64-bit read-only tags, Class 1 64-bit read-write tags, Class 0 96-bit read-only tags and Class 1 96-bit read-write tags. Once Gen 2 tags and readers are available, the DOD will phase out Class 1 and Class 0 tags. The appendix provides details on when specific EPC data constructs—including Serialized Global Trade Item Number and Serial Shipment Container Code—should be used. It also spells out in detail how many bits of data on the tag should be used for the elements of the data construct, including the company prefix, item reference and serial numbers. WHAT HAPPENS IF A SUPPLIER DOES NOT COMPLY? The DOD expects all suppliers to be compliant by the January 2005 implementation date. Contracting officers will work with non-compliant vendors to ensure that they are meeting the requirements of their contract. Compliance is a requirement for obtaining a DOD contract and will be used for contract performance analysis. WHAT DO SUPPLIERS NEED TO DO TO BE COMPLIANT? Suppliers to the DOD must encode an approved tag using either an Electronic Product Code (EPC) tag data construct or a DOD tag data construct. Suppliers that choose to use the DOD construct will essentially replace the manufacturer ID in the EPC number with a Commercial and Government Entity (CAGE) code. EPC global subscribers can use a standard EPC, so consumer packaged goods manu- facturers can use the same tag data constructs for the DOD that they use to comply with retailers’ requirements. 6
  7. 7. HOW CAN SUPPLIERS RECEIVE HELP WITH IMPLEMENTATION? As RFID quickly becomes a requirement for the supply chain, finding a partner who understands the technology, the compliance issues and who can provide the necessary business integration is paramount to success. Catalyst International delivers reliable, customer-driven software and services that optimize enterprise supply chain performance. With 25 years of experience in complex, high-volume warehouse operations, Catalyst offers an innovative suite of solutions that help global Fortune 1000 customers implement, integrate, manage and operate fast, efficient supply chain networks. Catalyst’s products and services have been seamlessly integrated into the enterprise environments of global Fortune 500 companies, including Avial, Boeing, Office Max, Rayovac, Reebok, Snap-On, Panasonic, Subaru, and The Home Depot. Headquartered in Milwaukee, Wisconsin, Catalyst serves customers in 20 countries worldwide. CatalystCompass™ RFID is a consulting practice dedicated to assisting companies in determining the best approach to deploying RFID. The Catalyst RFID Demonstration Center is a world class educational facility designed to help companies gain maximum benefit from RFID. For companies requiring strategic counsel, the consulting practice and demonstration center can help you: s Determine the best approach for RFID deployment s Identify and resolve label selection and positioning associated with product and environmental characteristics s Validate the approach via a proof of concept and a pilot that will identify and resolve technology, process, product packaging and environmental issues s Streamline the equipment selection, installation and deployment of RFID solutions s Achieve EPCglobal/DOD compliance Catalyst’s Implementation methodology ensures success in integrating RFID into the supply chain. Our methodology includes the following phases: Phase 1: RFID Business Case (4 – 6 weeks) s Executive Briefing (Overview on RFID, EPC and DOD compliance) s Recommended approach for RFID deployment s Cost and Benefit Analysis s Product and shipment tagging requirements s Proof of Concept Phase 2: RFID Design and Configuration (6 – 8 weeks) s Site Survey and RFID Configuration s Process Flow and Integration Plan s RFID and System Architecture Design s Revised Cost Estimates and Schedule 7
  8. 8. Phase 3: RFID Implementation (2 – 3 months) s Install and tune all RFID equipment s Install iRFID middleware module s Integration to WMS, SAP and other ERP systems s User training and support training s System commissioning s Operation support and maintenance s Create and agree upon detailed roll-out plan Phase 4: RFID Rollout (3 – 4 months) s Site survey and preparation s Training and education s Implementation and installation s Operational support s Ongoing Catalyst Help Desk Support Catalyst’s RFID implementation methodology ensures success in integrating RFID into the supply chain. Our proven method minimizes risk, keeps the RFID life cycle investment costs to a minimum and delivers a solution that companies can depend upon for RFID compliance, performance and reliability. Catalyst RFID Consulting offers the following benefits: s Meet short-term compliance requirements s Gain long-term scalability and flexibility s Start small, easily grow later s Easily adapt to variations in RFID requirements s Gain benefits of RFID without compromising the performance of SCE applications s Deploy a more configurable solution WHERE CAN I RECEIVE MORE INFORMATION? For more information, refer to or download the United States Department of Defense Suppliers’ Passive RFID Information Guide or Under Secretary of Defense RFID memo SUMMARY Let Catalyst International serve as your source for RFID technology guidance and services. For more information and to set up the initial meeting, please contact us at Corporate Headquarters 800.236.4600 European Headquarters +44 (0) 1895 450400 8