RFID System Planning - A Simple Overview

This document is intended as a short, simple summarised overview for companies thinking of, or wanting to, implement RFID technology within their supply chain operations. It is designed to increase awareness of the needs, wants, dos and don?ts when planning your RFID supply chain systems. A glossary of RFID terms is included to assist you when investigating RFID systems and technology. The single most important message is that defined objectives and planning are paramount; and that input and assistance from independent expertise at a very early stage, can save considerable time and money in the long term.

It is recognised that RFID will enable, (and already has in some cases), a new era of business optimisation, managing and increasing efficiencies throughout the supply chain. However knowing that it can assist your business, and understanding how it will do so, are different enough, let alone knowing how to actually implement a system that provides a sound return on the investment, whilst meeting your objectives.

The potential final cost of a fully integrated RFID supply chain operation would suggest that well planned objectives and a Pilot Scheme within part of the supply chain would be the prudent route to take. This ensures that a final system properly specified and implemented will actually produce the results that you both want and expect.

Business Drivers

The key driver for any investment of this type is the cost savings it will yield. However RFID technology provides additional advantages of real time and faster data capture, with a reduced human error factor. Unlike bar code-based systems, an RFID system can read the information on multiple tags without necessarily requiring line of sight and without the need for a particular orientation. The main business drivers throughout most sectors are as follows:

? Optimise asset and resource utilisation
? Optimise operational process & Manage supply chain exceptions
? Reduce transportation costs
? Reduce theft, wastage and loss
? Increase financial return on investments
? Optimise the labour force
? Manage KPIs and benchmarking
? Avoid congestion of assets and bottlenecks in the supply chain
? To reduce overall supply chain costs
? To assist in making informed decisions in respect of the logistics ?loop"

Where do you start?

The range of technologies, standards and options for RFID systems are too numerous to list here, and there is a danger of over specifying the technology required.

Providing that the system objective is not forgotten during the specification and implementation stage, then a suitable system integrator will ensure that there is not an over investment, or too much needless information being produced. It is therefore crucial that the functionality requirements and objectives are well thought out and defined in advance of partnering with a suitable System Integrator, specifically in relation to the management information you wish to extract from the system.

It is widely acknowledged by all who have conducted pilot schemes and RFID implementation that the most crucial factor is to conduct a pilot scheme with partners that have a proven track record, and are not learning as they go along. Therefore a System Integrator with relevant industry sector experience is vital.

From experience it is preferable, in the early planning stages, to have an independent project co-ordinator / facilitator assisting your project team. This individual should be separate from the Integrator and individual system / hardware suppliers working together on the project, and not part of any individual departments within your business that may bias the direction and objectives of the team.

Your RFID project team should be kept as small as possible to reduce management time, training needs, misinformation, over analysis and to remain focused to the project objectives. Team members should then feed back to their own local departments and teams to facilitate the actions and objectives of the project team.

What are your hardware requirements?

The functional requirements of the system will dictate the hardware and software specifications, for example the read / write capabilities of the RFID tags will ultimately be dictated by the business objectives.

With the ability to write tags comes the ability to change data. This is considered by some to be a very important feature of RFID, specifically when it relates to the retail and warehousing industry where it is not just pallets and boxes, but also individual product items being tracked and replenished. These business operations, information needs, standards, customer requirements and other variables can all change rapidly over a relatively short period of time.

The RFID readers will be able to read tags at a rate of several dozen tags per second; however the speed at which that data is processed into the system is limited and dependent on the network and database. The amount of data held on a tag will affect the read rates. This therefore means that the middleware, back end processing and management reporting systems must be wholly compatible with the tags and readers supplied in terms of speed and capability.

It will be the results of the Pilot scheme that facilitate the specific ?roll out? requirements for the full system. The exact specifications of the hardware requirements for the pilot scheme are to be specified during the site survey and process analysis by the system integrator. What are your system software requirements?

A key area for concern is handling the sheer volume and speed of data produced by an RFID system.

If you were to implement an RFID system by directly hooking RFID readers to the backend management and ERP systems, the results will be disastrous due to the massive volume of data directly entering the system.

What?s needed is the right system architecture, not only to maintain data accuracy and authenticity, but to make meaning of the vast volumes of data delivered by the RFID readers. Some estimates are that pallet, tote and item-level tracking, combined with data generated by RFID readers as items move within the enterprise, will increase the volume of data by 100 to 1,000 times today?s levels in most supply chains (source: RFID Journal).

Effective RFID implementations should follow the architectural principles developed for financial trading systems, process control and large-scale network management. Like RFID systems, these systems process huge volumes of data, correct errors in real time, correlate events, detect trends and patterns, re-organise and cleanse data and recover from faults ? all in real time.

A role of the system integrator is to develop and implement an operational data management architecture that captures events at the ?edge? of the enterprise, where operational activity occurs, rather than in the centre, where business-oriented transaction processing occurs. To achieve manageable data then the architecture will comprise of data concentrators and pipelines to route relevant data to the specific user systems that require it, thus not overloading any individual back end management system. For example:- container / pallet data to the asset management system, product and stock data to the ERP and MRP systems cost data to the financial management systems and so on??.

System compatibility in a Global Supply Chain is important, not necessarily for the pilot scheme, but if it is to facilitate a successful roll out across the whole supply chain. Global standards are progressing with the new systems created in compliance with the EPCglobal Generation 2 (Gen 2) standard.

Gen 2 creates a foundation on which to build interoperable RFID products and systems that will improve inventory management, logistics and retail operations around the world. However there will be significant performance and capability differences among Gen 2 compliant equipment. Gen 2 is a standard, and standards specify minimum performance requirements and will therefore not accommodate all systems, as standard ?based equipment will not provide a standard performance.

Gen 2 specifies basic RFID communications performance required for common supply chain business processes. However, although companies within the same sector have similar information needs as their competitors and have comparable business practices, usage environments will be very different depending on age and design of the assembly / manufacturing facility, geography and culture. Gen 2 or any RFID technology won't provide exactly the same performance at any two facilities. That is why it is important to understand the difference between what Gen 2 specifies and the range of performance that Gen 2 compliant products can provide.

What next?

RFID does not need to be as complicated or as daunting as some of the industry players would have you believe. Just because the technology exists it does not need to be used to maximum capacity throughout all supply chains. The following factors are considered to be key when moving forward:

? Do not overcomplicate the technology; use what is suitable to meet your objectives.
? Ensure the correct partner (system integrator / provider) is engaged from the outset.
? Ensure that the systems chosen can move with technology
? The pilot scheme is just that - it will need development

RFID system planning is crucial to its success but can on its own be a major task. This combined with the fact that you may have little or no RFID expertise internally can prevent you from taking your first steps to deciding if RFID is suitable to you and your business. Gideon Hillman Consulting can assist you with knowledge and experienced based RFID system planning and help you design a project plan with specific focus on:

-Project Objectives & Scope
-Resource Requirements
-Project Stages and Timescale
-Project Milestones
-Integrator / Supplier Choice
-Regular Technical Reviews

Investment into planning and consultative project management at the outset can negate over investment and additional cost in the longer term.

RFID Terminology:

ASN ? Advanced Shipping Notice ? notification between vendor and customer of parts due or to be delivered.
Agile reader - An RFID reader that can read tags operating at different frequencies or different communication protocols.
Air interface protocol - The standards that govern how RFID tags and readers communicate.
Anti-collision - Anti-collision algorithms are used to collect data from multiple RFID tags at the same time from the same RFID reader without interference.
Auto-ID Centre - The original non-profit organisation that helped develop RFID system technology. This work is now continued by EPCglobal.
Backscatter - The communication method between a passive RFID tag and a reader. An RF signal sent by a reader is reflected back to the reader from the tag, which is modulated to transmit data.
Beacon - An active or semi-passive RFID tag that is programmed to wake up and broadcast a signal at pre-set intervals.
Commissioning - Writing data to an RFID tag for the first time. This can happen at the factory or later using a smart label printer.
Concentrator - A device used to gather data from multiple RFID readers at the same time. Contactless smart card - A credit card or buyer card that contains an RFID chip to transmit information without having to be swiped through a reader.
EPC ? Electronic Product Codes
EPCglobal - The organisation set up to commercialise RFID technology, which has taken over this task from the Auto-ID Centre.
Far-field communication - An RFID tag that is located one full wavelength away from an RFID reader.
HHT ? Hand Held Terminal ? portable handheld RFID reader which operators can carry to manually interrogate RFID tags
Inductive coupling. - An RFID reader antenna and a tag antenna each have a coil, which together form a magnetic field. The RFID tag draws electrical energy from this field, which powers its microchip. The microchip then changes the electrical characteristics of the tag antenna. These changes are sensed up by the reader antenna and converted into a serial number for the RFID tag.
Interrogator - Another name for an RFID reader.
KPIs ? Key Performance Indicators ? used in performance benchmarking processes
License plate - A simple RFID system that only tracks RFID tag serial numbers and no other information.
Middleware - In the context of an RFID system, refers to software that is used to filter RFID data and pass on useful information to enterprise software applications for further processing.
Moores Law - The observation made in 1965 by Gordon Moore, co-founder of Intel, that the number of transistors per square inch on integrated circuits had doubled every year since the integrated circuit was invented. Moore predicted that this trend would continue for the foreseeable future. In subsequent years, the pace slowed down a bit, but data density has doubled approximately every 18 months, and this is the current definition of Moore's Law.
Passive tag - An RFID tag without a power source or transmitter. Radio waves from an RFID reader are collected from the RFID tag antenna, which powers up the microchip in the tag. The tag is then able to send back information stored in the chip to the reader.
Phantom read - When a RFID reader reports the presence of a tag that doesn't exist.
RFID reader - A device used to communicate with RFID tags. The reader has one or more antennas, which emit radio waves and receive signals back from the tag. The reader is also sometimes called an interrogator because it "interrogates" the tag.
RFID tag - A microchip attached to an antenna in a package. An RFID tag contains a unique serial number at a minimum, but commonly contains other information about a product. RFID tags can be passive, semi-passive or active.
Semi-passive tags - Similar to active RFID tags, but the battery is used only to run the RFID chip - not to broadcast a signal to a reader.
Slap and ship - Placing an RFID tag on a case or pallet just before it is shipped from a supplier. Used to meet a retailer's requirements.
Smart label - A bar-code label that contains an RFID tag.
Transponder. A radio-frequency transmitter-receiver combo. Another term for a RFID tag.
Write-once, read-many (WORM) - A RFID tag that can be written to (changed) only once by a reader. Afterward, the tag can only be read.

Gideon Hillman was employed at a Senior Management Level throughout Europe within the Materials Handling, Logistics and Specialist Supply Chain Services industry for over 12 years, (7 of which with TNT Logistics), prior to establishing Gideon Hillman Consulting in 2004. Gideon is a Member of the Institute of Logistics and Transport & The Institute of Management Consultants. As well as presenting to, and working with, Industry specific forums such as BARD / BPI in the music retail industry, the IISRP in the Global Automotive Tyre Industry and the Odette Group for Automotive Materials Handling, he was a Keynote speaker on "Asset management in the supply chain", at the 1998 IFPWA Global conference and has worked closely with the IARC (International Automotive Research Centre) on RFID implementation for Automotive Stillage Tracking. He was also a speaker on Asset Management in the Humanitarian Aid Supply Chain, at the 2006 Aid & Trade Humanitarian Relief Conference in Geneva.