RFID Technology

1. an APICS presentation by: Vikram Seshadri, RFID Technology The Mapping of a Brave New World of Challenges and Opportunities October 3rd 2012

2. History of RFID

3. RFID Technology A MICROCHIP holds data as an EPC (Electronic Product Code) Radio Frequency Identification A micro-chip in a label used to transmit data when the label is exposed to radio waves READERuses radio waves to read the tag and send the ID to Aries Server Transmit EPC Main Components - RFID Tags, RFID Reader – Antenna & transceiver (reader), Host Computer. 01-0000A89-000169DC0 Tagged Asset Data & Information Transfer to MIS/IT Systems • Visualization of • Equipment • Personnel • Events • movement in facility Aries Middleware Server and Client

4. RFID – Types and Operational Principle Antenna Active Passive • Passive • Operational power scavenged from reader radiated power • Semi-passive • Operational power provided by battery • Active • Operational power provided by battery - transmitter built into tag 

5. RFID – Electronic Product Code Header - Tag version number EPC Manager - Manufacturer ID Object class - Manufacturer’s product ID Serial Number - Unit ID With 96 bit code, 268 million companies can each categorize 16 million different products where each product category contains up to 687 billion individual units Note: 64 bit versions also defined, 256 bit version under definition

6. RFID – Evolving Technology The world's smallest and thinnest RFID tags were introduced this year by Hitachi. Tiny miracles of miniaturization, these RFID chips measure just 0.05 x 0.05 millimeters. The previous record-holder, the Hitachi mu-chip, is just 0.4 x 0.4 millimeters. Take a look at the size of the mu-chip RFID tag on a human fingertip.

7. RFID – Evolving verticals Evolving processes, evolving solutions • Supply Chain Management • Manufacturing tracking and optimization • Medical and Healthcare • Equipment • Patient • Processes • Security & border crossing • Airline luggage tracking • Pedigree tracking (Drugs) • Animal tracking

8. Understanding RFID The hype that (nearly) doomed us…

9. RFID: Defining the core value Define control points Define information filters Define Enterprise Actions ERP/MIS SCM RFID RFID

10. RFID in Retail Supply Chain Automate the Supply chain process RFID TAG Reader

11. RFID in Retail Supply Chain Behind the physical process…

12. RFID in Retail Supply Chain Is the challenge of Information Management What ? Where ? Information When ? Who ?

13. RFID in Retail Supply Chain Supplier Retailer store Manufacturing Retailer/Distributor/ Distribution Consumer Clear segmentation in areas of opportunity/value

14. RFID in Retail Supply Chain

15. RFID in Retail Supply Chain The power of information aggregation

16. RFID in Retail Supply Chain Item level tagging Box level tagging Pallet level tagging Aggregation can yield 90% benefits of item-level tagging, at less than 10% of the cost Trailer level tagging

17. RFID in Retail Supply Chain Automate the Warehousing process

18. RFID in Retail Supply Chain System Visualization & Tracking

19. RFID in Retail Supply Chain Benefits at a glance: Front-end • Better customer trend/preference recognition • Decrease in "lost" stock • Faster Locating stock • Lower labor requirement • Reduction of out-of-stock • Lower safety stock level • Facilitation of JIT Benefits for Everyone: Reduction of Loss, Wastage, and Inefficiencies • RFID might not be the only way to gather some of the above data A study by the University of Pennsylvania's Wharton School found that shoppers left apparel stores more than 30 percent of the time without finding at least one item they came in to buy.

20. RFID in Retail Supply Chain Benefits at a glance: Back-end • Benefits for Retailers • 5 – 8 % improvement in shelf stock rate • 5 – 10 % lower inventory levels • 3 – 4 % lower logistic costs • 2 – 10 % higher sales due to lower out of stocks • Benefits for Manufacturers • 5 – 30 % lower inventory levels • 2 – 13 % lower warehouse and transportation costs • 10 – 50 % reduction in lead-time (facilitates JIT) • 1 – 5 % higher sales due to lower out of stocks Benefits for Everyone: Reduction of Loss, Wastage, and Inefficiencies Including: nearly 40% reduction in paperwork

21. RFID – Effect on consumers In the future all items could be tagged Real-world examples • RFID enabled shopping carts • Fewer empty shelves • No queues • RFID fridge of the future • Personal shopping cart (Germany)

22. Privacy – the price of convenience Consumer awareness is low, but rising Retailers dream, libertarians nightmare “How would you like it if, for instance, one day you realized your underwear was reporting on your whereabouts?” California State Senator, 2003. RFID labelled as SPYCHIP by some

23. RFID – Privacy Issues

24. Let’s break for dinner….. We are here to answer your questions……… Vikram Seshadri

25. RFID – Effect on Management Decisions What will be the effect on management decisions? Metrics relevant to management decisions • Visibility & Quality of data • Impact on costs • Quantification of benefits • Implementation and customization cost • Strategic and operational benefits • Return on investment • Legal implications and privacy concerns

26. RFID – Opportunities Key Question: Can I make a measurable improvement, and provide a strategic benefit ? • Visibility • Ability to visualize and quantify processes • Time • Being able to respond more quickly • Taking quicker decisions • Quality • Quality metrics definition • Baselining and Incremental improvement • Feedback • Minimize human factor • • Savings • Streamlining orgn • Long term savings

27. RFID – Implications • Will require faster responses! • Competition on new terms • Cost • Adapt existing systems and buying new ones • Software • Hardware • Train people • System failure • What to do? • Personal Integrity • Ethical? Customers & Personnel • Laws: labeling of goods carrying chips • Proactive privacy protection

28. RFID – Effects on levels of Management • General effects • Training, faster decision making • Data-driven paradigm • ”Continuous improvement” • Middle Management • Empowerment • Job cuts • Higher/Executive Management • Understanding (better) • Strategic focus

29. RFID – The Future RFID: Driving intelligence to edge of Enterprise networks Analog sensors replaced with cheap digital sensors: Motes, etc Enterprise Management Systems adapted to more effectively react in real-time to data “Middleware” Our professional lives Our personal lives Knowledge Management

30. Famous Quotes… Albert Einstein: “We can’t solve problems by using the same kind of thinking we used when we created them” The key to succeeding in the new world is to change our perspective, viewing old problems through new eyes!

31. Concluding Remarks…. How long can I wait to decide how to use RFID to my advantage? “Start study and discover how RFID can help your business, or your competitors will gain a competitive advantage that you may not be able to overcome!”

32. RFID – References & Recommended Reading • Publications • A Workshop Report from the Staff of the Federal Trade Commission. 2005. Radio Frequency Identification: Applications and Implications for Consumers. Diane Publishing. • Finkenzeller, K. 2005. Second Edition. RFID Handbook: Fundamentals and Applications in Contactless Smart Cards and Identification. John Wiley & Sons Inc. • Glover, B. and Bhatt, H. 2006. RFID Essentials. O'Reilly Media Inc. • Practel, Inc. 2004. RFID Report: A New Horizon for Accountable Society. Information Gatekeepers, Inc. • Shepard, S. 2005. RFID: radio frequency identification. McGraw-Hill. • Websites • http://www.rfidjournal.com/article/view/5112/1 • en.wikipedia.org/wiki/RFID • www.rfidjournal.com/ • www.rfid-weblog.com • www.spychips.com • www.verichipcorp.com • www.wethepeoplewillnotbechipped.com

33. RFID – Questions…