by [TC]²
A monthly column of technology rambling, rumination and reality
By: Jud Early, Corporate Vice President, and Chief Technology Officer, [TC]²
September 2006
Hello, faithful readers,
I first must express my thanks to those who e-mailed or called to see if the Technology Corner had died. This month marks the first since February that I have been able to devote time to collecting information and bringing it to you in the newsletter. I’m sorry about the lapse in publication. In early March, I accepted additional responsibility in the area of finance and human resources at [TC]². Since that time, I have been busy with restructuring our accounting department and working with a new accountant to develop streamlined reporting for timely business decisions. With this issue I plan to resume a monthly newsletter that will vary in timing, but will be published each month during a week in which the [TC]² Technology Communicator is not published.
RFID – The Promise and the Reality
A Conference jointly sponsored by RFID Journal and AAFA was held in New York on August 16. I came away with mixed feelings about how near, or how far we are from broad adoption of RFID technology, especially at the item level. More on that later.
Normally the press is welcomed and often is afforded a complimentary admission, since event promoters hope to read positive comments from those media folks and writers. My request for a press pass was denied, so a fully paid registration was required. I later learned the reason why press was not welcomed is the concern that the summit might be infiltrated by members of CASPIAN, the vocal group that opposes the use of RFID, and even affinity cards from supermarkets, labeling all such as “The Mark Of The Devil”. This irrational fear among a few zealots has done more to harm RFID than the concern for lower tag costs. The cost of tags has fallen as manufacturers improve yields and assembly processes become more automated. The reality of a five cent or less individual tag is not far away, and with the breaking of the price barrier, it will be possible to utilize RFID in many points within the supply chain.
Take note of the word “possible” in the preceding sentence. Possibility does not lead to ubiquity, nor does mandated use lead to broad adoption. Without the mandate from Wal-Mart and DOD to top tier suppliers, the level of penetration at the case and pallet level would not have happened. Vendors who wanted to continue to sell to Wal-Mart were compelled to begin use of the technology, and some whose systems were already fine tuned to management using bar code labels had smaller gains to be realized. However, those who did not have robust systems of control were enabled to reap rewards, and many that I have spoken with have done so. It is the use of item level tagging that brings the greatest pessimism to me, and that just should not be the case. It is possible to attach (sew in or otherwise permanently attach) tags at the beginning of manufacture, giving each SKU a different identity which will allow tracking the item as it progresses from raw material to finished goods, and from finished goods into processed orders. At an industry symposium on RFID sponsored by [TC]² in 1995, attendees developed a “wish list” of many uses in the supply chain, extending past the consumer purchase and into the cleaning and eventual recycling of the RFID tagged garment. My pessimism stems from the lost potential that can be realized if only the industry is bold enough to adopt unit level tagging, and is also bold enough to counter the anti-tag zealots with a strong campaign of RFID benefits, and a fearless adoption of the technology along the supply chain. Adding the “kill” feature to tags was a backward step in the evolution of tags. I’m sure to come under fire for that statement, but I feel that caving to special interests in providing a means to kill tags at point of sale was an unnecessary move and one that should have been countered by a shove in the face to those seeking to stop deployment.
The morning of the conference in New York I was watching the news as I dressed, and saw a commentary by one of the zealots regarding the danger in attaching RFID to passports. As the founder of the movement, the news people seemed to grant some authority to her words as she condemned the use and stated that anyone with two hundred dollars worth of technology can duplicate the tags. Through such misinformation as this, the consumer is led to believe that RFID is dangerous and should not be used. The same argument could be made for keeping knives in the kitchen. I found it highly coincidental that she could appear on TV the same morning as the RFID Journal/AAFA Summit, but there was no reference to the Summit, which was a well attended event.
Now to the event… James Stafford of Marks & Spencer in the UK presented a well done story about their use of item level tagging in clothing in forty-six stores. He stated that twenty-five million garments had been tagged by forty-four factories in twenty countries. They also are tagging recyclable food trays that are used to transport food within the M&S system. More than 1.5 million tags are now in use on food trays. Inventory is taken locally with hand-held wands, and can be done during store operating hours and does not require “primping” the merchandise, nor does it require scanning each item’s bar coded tag. The wand is couple wirelessly to a portable console that contains a computer and as each item is read by the wand, those items that were reported by a previous scan are ignored, while newly arrived tags cause a beep to occur when read. In this way the inventory is scanned until all beeps stop, which means that all inventory has been registered in the system. By so doing, it is known in real time what items are in stock and which are needed to meet the stock plan. Goods are moved from the distribution center to the forty-six stores within hours, preventing the consumer from being disappointed by an out-of-stock condition. All garments with a price of more than nine pounds sterling are tagged. Mr. Stafford would not comment on the economic benefits, but was pleased to say that M&S were quite satisfied with the results. Why, then does this successful implementation cause me to doubt that the full potential of RFID will be realized? The item tags are added to the goods at completion, which offers no benefit in the factories. The tags are not used in portal scans to track the movement of merchandise, but the biggest disappointment in this otherwise fine story is that the tag is either killed at the point of sale, or is removed, also removing the benefit of streamlined returns, customer affinity programs, coordination of other garments in later promotions, and the potential uses in laundry and dry cleaning to ensure proper garment care. So much is not being enabled, and it is due to a misplaced hysteria caused by a few kooks.
A different story was told by Bosco Law, corporate development director at Laws Group. They are a large manufacturer of apparel, and are using RFID for control in 175 manufacturing operations in fifteen factories in Asia. After a six year journey from 2000 until now, the Laws Group has adopted unit level tagging and has improved WIP control, identified bottlenecks in manufacturing, and has replace manufacturing data capture while reducing cost. Lead time was reduced by 27% and production planning accuracy improved by 29%. Cost of implementation was more than $5 million USD, and there was no projected payback calculation, just the firm belief that RFID would add value in ways that could not be imagined. Such blind faith has paid off and the company is now reaping the benefits of technology leadership. This is a story that I am pleased to being you, since it shows the benefits of an earlier entry with RFID, and the boldness that this company’s management had when deciding to move forward. My compliments to those who allowed this to become a success!
I’ll cover additional items related to RFID in the next edition of the Technology Corner. One of particular interest is RFID telemetry and how it enables better cooking and can keep your feet warm. Stay tuned.
Until next month, stay well, compute safely, and continue reading.
Jud