One of big winners of the 2008 Olympics in Beijing was RFID technology, which is also increasingly winning commercial applications around the world.
Last month, the world's fastest man, Usain Bolt, captured an Olympic medal for Jamaica when he ran the 100-meter dash in less than 10 seconds. That's stunningly fast. But did you know that before Bolt reached the finish line you could have scanned over 100 garments with a handheld RFID reader? That is one of the key findings in a study conducted by the RFID Research Center at the University of Arkansas.
Whether authenticating Olympic athletes or helping retailers and consumer good manufacturers track inventory, RFID has finally come of age.
One of the largest RFID deployments in history, the 2008 Olympics in Beijing last month was big in every way: China hosted 280,000 athletes, referees, journalists, and other workers from more than 200 countries and regions, and 7 million spectators watched the games at the venues, all identified with tickets using RFID anti-counterfeit technology.
In addition, to ensure the safety of food for athletes, coaches, and spectators by tracking the path from farm to plate, the China Olympic committee contracted for 12.2 million RFID tags to protect the production, processing, and transport of food and beverage products to coaches, athletes, and concession stands. A mix of 1,000 active and passive RFID systems recorded temperatures of highly perishable foods like beef and pork in addition to identifying the destination of thousands of different meals for hundreds of menus.
In short, RFID worked on a grand scale at the Beijing Olympics, and China will again turn to that technology for the 2010 World Expo in Shanghai, where nearly 70 million RFID tags will again help identify, track, and trace visitors, assets, and food stuffs.
From Gold Medals to Gold Lamé
Meeting Olympian challenges is not the only way RFID is being used in a big way this year. Research firm IDTechEx estimates that RFID spending on apparel will be $68 million in 2008. The Cambridge, Massachusetts-based company predicts that figure will rise to $988 million in 2013, an impressive 71 percent compound annual growth rate.
According to IDTechEx, some 200 million RFID tags were purchased in 2008 for apparel deployments alone. These staggering numbers are proof that RFID works. Retailers and apparel manufacturers have determined that the ROI (return on investment) from RFID is measurable, and despite the global economic slowdown, they are expanding their RFID plans.
For example, the Karstadt Warenhaus chain of German department stores has successfully deployed an item-level RFID system at its 323,000-square-foot Düsseldorf store. There, 50,000 items--from jeans, to sweaters, to shirts--from six suppliers were tagged, and this is what store management learned from the nine-month test:
- Recording incoming merchandise used to take one hour; with RFID the process now takes eight minutes, a time savings of 85 percent.
- Inventory checking used to take one hour and 20 minutes per department; with RFID, stock checking now takes 20 minutes, a time savings of 75 percent.
- Repricing items used to take four days; with RFID, the process now takes two hours.
- The store also saw a 75 percent decrease--from 80 seconds down to 20--in the amount of time spent checking stock for a specific type and size of jeans.
More Than "Slap and Ship"
The primary reason that RFID deployments are expanding this year is that pioneering customers in the field discovered that the more they invest in RFID, the better the ROI.
Manufacturers who implement minimal RFID technology only because they need to comply with an Electronic Product Code (EPC) mandate (from Wal-Mart or the Department of Defense, for example) and simply affix an RFID smart label on a carton and/or pallet as it leaves their facility are missing the opportunity to use the technology to save time, improve data accuracy, and save money. In short, you can get more benefits by employing RFID toward the beginning of your supply chain process, as opposed to leaving RFID to the end of the process. The earlier you introduce RFID and the more applications that become RFID-enabled, the greater the benefits.
For example, if you ask your supplier to put RFID smart labels on the cartons of raw materials or finished goods that you purchase, you can take advantage of the incredible time savings RFID offers in receiving. If you put RFID tags on totes and other fixtures that you use in your facility, you can track work in process, orders, and components far more efficiently than you can today. And, if you tag the finished goods that you store in your warehouse, you can dramatically reduce the time it takes to do physical inventory (or cycle counting), and you can automate picking, order fulfillment, and ASN creation to a greater degree.
Doing More with Less
The first step in determining your ROI is to measure your baseline Key Performance Indicators (KPI). How much time does it take now to receive goods? How much time does it currently take to pick, pack, and ship orders? What is the cost of misdirected orders? What is the cost of specialty ingredients that need to be reordered because they have expired and there is no system in place to track the expiration dates? What is the cost of idle machines and workers because of how long it takes to find a mold or a tool in your shop? And how visible are your inventory levels? Are you adding "safety" levels to your inventory that cost money but may not be needed? By looking at every facet of your business--from asset management to labor management to manufacturing to warehouse and supply chain management--you can find areas that can take advantage of the real benefits of the no-line-of-sight-required automatic identification that RFID can bring to your enterprise. No matter what business you are in, time is money, and the time savings of RFID let you do more with less.
The RFID Market Is Now Mature
Another reason that RFID deployments are starting to pick up steam is that the latest crop of readers and tags are delivering increased performance while also reducing installation, integration, and operations costs.
First, RFID readers have gotten smarter. Literally. For example, the Intermec IF61 Enterprise Reader is capable of running complex RFID applications all by itself. The IF61 filters, stores, and manipulates information from tags and sends it to a server in a required format, while monitoring external sensors and controlling audible and visual indicators. If the network is down or electrical power fails, the IF61 has "store and forward" capabilities. How many tags can this reader "store"? A fully loaded IF61 can store over 6 billion RFID tags.
Another new reader, the Motorola XR450, has advanced data collection features, such as filtering, reconciliation, user-defined association, and selective visibility. By setting filters based on rules and then associating the filters with specific read points, the XR450 can be configured through software to ignore all RFID tags except the ones the application is interested in. In addition, the XR450 features both bi- and mono-static antenna ports on one platform to protect RFID investments and decrease deployment complexities. Mono-static ports are ideal for real-time item-level tracking, while the bi-static ports offer the highest possible performance in the most challenging RF environments.
In the direction toward simplicity, new readers from Alien Technologies and ThingMagic make installing an RFID system much less costly and easier to deploy. The Alien 9860 and the ThingMagic Astra both feature integrated antennas and Power Over Ethernet (POE) to eliminate the need to run electricity to the read zone.
RFID Tags Now In Stock
Tags, too, have seen many advances: manufacturing processes have improved reliability, and the cost for passive RFID tags has dropped significantly. Gen 2 (EPCglobal's Class 1 Generation 2) is the first standard that was widely embraced by the entire RFID ecosystem: chip and tag manufacturers, reader and antenna manufacturers, and the businesses that have invested in RFID.
Because of this widely adopted standard, customers can now choose from many suppliers of Gen 2 hardware and supplies. Multiple suppliers of Gen 2 RFID tag inlays are now competing to supply the industry's label converters. This development has helped drop the cost of a 4" x 6" smart label from 45 cents to 15 cents over the past few years.
Also on the supply side, until the Gen 2 standard was ratified, no manufacturer wanted to stock smart labels if there was a chance the Class 0, Class 0+, and Class 1 tags would be rendered obsolete (which they now are; EPCGlobal is no longer developing Class 0 and 1 tags). Because no smart label supplier wanted to stock supplies, every order was a custom order, so no customer could benefit from quantity discounts. This cycle prevented budgeting for RFID because label converters would quote prices based on testing and pilot quantities but couldn't predict what the price would be as customers rolled out RFID systems in production. Now you can order, from stock, 2" x 4", 4" x 4", and 4" x 6" smart labels from a number of manufacturers at competitive prices.
In addition to lowering costs, tag manufacturers are continuing to add new capabilities as well. New Battery Assisted Passive (BAP) tags from companies such as Intelliflex and PowerID feature impressive read distances and improved performance characteristics at a fraction of the cost of active RFID systems. BAP tags give customers the very long range of an active (battery-powered) tag at a cost closer to a passive (non-battery-powered) tag.
The latest advance in RFID is from Mojix, a startup formed by a team of former JPL/NASA scientists. The Mojix STAR system combines advances in digital signal processing technology to deliver 100,000 times the indoor receiver sensitivity, 20 times the read range (600 feet), and 100 times the coverage area (up to 250,000 square feet) of existing passive RFID systems.
Putting the Power of RFID into IBM Power Systems
Putting all these advances in RFID tags and readers to work requires software to integrate the technology with ERP or WMS systems. This "middleware" communicates with RFID readers and collects, processes, consolidates, and reconciles the RFID tag data and then extracts business information. Before the advent of smart RFID readers (such as the Intermec IF61 and the Motorola XR450), this filtering (looking for specific tags) and smoothing (rejecting duplicates and erroneous reads) needed to be done by a standalone server; the sheer volume of tag data would clog a network and bog down a host optimized to run business applications. As the number of readers increased, this job became even more complex. In addition, this middleware server also had to manage and monitor the system to detect and report errors and maintain integrity and stability. Another task once performed by this separate server is reader configuration and maintenance: RFID readers for different locations and applications behave differently, so the configurations needed to be tracked and maintained.
Another component that needed to be in the system was an edge server, a device whose sole purpose is to communicate with devices on the edge of the network such as photo eye sensors (presence detectors) and signal lights.
A number of middleware vendors combine both middleware and edge functions into their offering. Sounds great, right? Well, except one big point: these vendors have developed products that will work with any server, but they don't run on System i. And because these vendors wish to be known in the marketplace as application-neutral, what that really means is that your IT staff (or an army of consultants) has to build the bridges between these boxes and your System i applications.
There's nothing more frustrating than a PC that locks up, especially if that PC has a vital role as an "RFID middleware server" in your supply chain. The dreaded "Blue Screen of Death" could severely limit your ability to get your products to market.
CYBRA Corporation recently conducted a survey of more than 514 System i shops to learn of their plans for RFID. As of May 2008, 25 percent of the customers surveyed are currently using, piloting, or implementing RFID technology.
When asked "On which computing platform is the current RFID System based?" 46 percent responded OS/400, 22 percent said Windows, and 5 percent said Linux or UNIX. But when asked "On which computing platform would you prefer the RFID System based?" OS/400 jumps to 63 percent, and Windows drops to 16 percent. Of customers who run their Warehouse Management Systems (WMS) on OS/400, the numbers are dramatic: only 10 percent of System i WMS customers prefer to run their RFID systems on a Windows, Linux, or UNIX platform.
System i customers overwhelmingly prefer the System i to the PC for RFID for obvious reasons. The things that the System i excels at--generating EPC codes, printing RFID smart labels, generating manifests, defining business rules, and storing configurations--are easier to manage on the System i because that's where your order and product information is. Now, if you can define a filter (show me only pallet tags), and a rule (divert pallets going to store 4501) on the System i, and program the reader directly from the System i, is there any reason to use PC middleware?
Is this the year System i customers start reaping the benefits of RFID? The RFID success at the Beijing Olympics proved there is no project too large for RFID. Pilot projects in retail and apparel are documenting real performance gains, RFID readers are getting more powerful while becoming easier to install, RFID tags are dropping in price yet having more capabilities and greater reliability, and the System i is uniquely qualified to be the perfect platform for RFID.
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