Slide 1:RFID Will Remote Radio Frequency Identification Technology Revolutionise the Supply Chain? Presented by Simon EnglandSlide 2:Early Beginnings  Precursor technologies:  Continuous Wave Radio (1906)  Radar (1922)  AFF  Stockman raised idea of devices powered by radio wave vibrations  Beigel’s patent is first RFID-like device  Anti-theft tags first basic, widespread implementationSlide 3:What are RFID Tags?  Two different types of tags, but both feature:  A microchip core  An coupling device  Two distinctive tag types and one hybrid mix.  Passive tags  Active Tags  Semi-Active TagsSlide 4:Tags: Passive  Cheap to print in mass-production.  Limited storage space.  EPC global standard for utilising available space.  Range limited to around 5 metres.Slide 5:Tags: Active  Include a power source: a battery or capacitor.  Power allows greater memory capacity.  Greater range, up to 100 metres.  More expensive to mass-produce.Slide 6:Tags: Semi-Active  Combination of both active and passive technologies.  Smaller memory capacity.  Integrated power source.  Offers greater range at a cheaper price than active tags.Slide 7:Trials of RFID Technology Government Initiative Early Trials Recent TrialsSlide 8:UK Government Initiative  UK Home Office conducted a ‘chipping of goods’ initiative, starting May 2000.  Aimed to determine effects of RFID on reducing retail crime rates.  Provided financial support to 12 retail companies to trial RFID tagging of products.Slide 9:Roberti’s Prediction  In an analysis of the initiative, Roberti (2002) loosely suggested: “The government is seeding the market, encouraging U.K. companies to be leaders in adopting RFID… [perhaps] U.K. vendors will be among the key players in the emerging RFID market.”Slide 10:Lever Fabergé Trial 2002  Developed a web-tracking portal in a small trial with two partners:  Safeway, end-retailer of product  Tibbett & Britten Group, logistics provider  Tagged 30,000 packs of Lynx deodorant  Reported benefits in the 2005 Consumer Packaging Report:  Better management of stock  More timely shelf fillingSlide 11:Enter the World’s Biggest Retailer  Wal-Mart is the world’s largest retail group in terms of revenues.  In 2004, they mandated their top 100 suppliers, requiring them to tag products at case/pallet level by January 1 2005.  Reported 100% compliance rate.  One of the larger suppliers was Pacific Cycle.Slide 12:Wal-Mart’s Trial: Pacific Cycle  The supplier reported various immediate benefits:  Warehouse transfers on order confirmation  Immediate confirmation to customer of transfer  Advanced shipping notification  Goods receipt by customer  Much more automated billing proceduresSlide 13:Wal-Mart’s Trial: Pacific Cycle  Pacific Cycle also announced expected future benefits:  Accurate, certified order fulfilment  Improved sales  Reduced out-of-stock situations  Reduced discrepancies requiring reconciliation  Greater retail stock-movement visibility  Improved efficienciesSlide 14:Other Recent Trials  Marks & Spencer reported staff morale and productivity levels were up.  Plan to roll out trials to further stores and distribution centres.  Volkswagen invested €550m in RFID.  Announced that implementing RFID led to a 20-fold increase of speed in warehouse operations.Slide 15:Past & Future Spending  Juniper Research highlighted European spending on RFID technology at £238.7m during 2005.  Predicted spending to reach £1bn by 2009.  Retail supply chain will be the biggest spending area followed by pharmaceuticals.Slide 16:Juniper Research: Spending Breakdown $1856.7m$1485.4m$1142.6m$846.4m$626.9m$464.4mTotal: $185.7m$148.5m$114.3m$84.6m$75.2m$69.7mOthers $575.6m$490.2m$388.5m$296.2m$250.8m$185.8mSupply Chain $371.3m$297.1m$228.5m$169.3m$112.9m$83.6mMass Transportation $408.5m$282.2m$194.2m$127.0m$62.7m$32.5mPharmaceutical $315.6m$267.4m$217.1m$169.3m$125.4m$92.9mRetail 200920082007200620052004Slide 17:Supply Chain Benefits: Manufacture “Holy grail of RFID technology will be the ability to track and monitor every product part at each stage in the manufacturing process.”  Will allow easier tracking back in the event of faulty components.  Reduces financial loss from missing parts.  Greater records of individual parts in a completed product.Slide 18:Supply Chain Benefits: Logistics  Automated checking of goods when loading/unloading.  Allows tracking of products throughout transport chain.  Aids in reducing human error by automating many processes.  Gives customers ability to check status of items online rather than telephone inquiries.Slide 19:Supply Chain Benefits: Inbound Shipments  Every product scanned and recorded when delivered, cutting out risk of human error.  Stock levels in inventory systems may be updated instantly.  Allows confirmation of receipt to be sent to supplier.  Brings up the possibility of automated invoice payments.Slide 20:Supply Chain Benefits: Retail Improvements  Smart shelve technology could revolutionise just-in-time systems.  Reduces out-of-stock situations, and therefore the risk of losing business.  Self-service checkouts are a long- predicted advent of RFID.  Allow the customer to process their own goods at checkout automatically.  Could potentially track customer’s movements around a store.Slide 21:Privacy Issues  How often are tags read, and who is allowed to?  Would a man want a gift shop to know he just bought lingerie? Would a woman want a music store to know her underwear size?  How long should tags remain active after purchase?  RFID ‘clouds’ could bring about an extra element to the ‘big brother’ state.Slide 22:Potential Solutions to Privacy Concerns  Killing active tags at the point of purchase.  Applying encryption techniques to tags.  Allowing consumers to carry a ‘blocker’ tag which prevents other tags on their person from being read.Slide 23:Security Issues  Recent reports suggest concerns over the potential to hide viruses in tags.  If any company can read what is on a tag, businesses have to be careful what data is held.Slide 24:Read Rates  Reports have suggested read rates as low as 4%.  This figure while attempting to read an RFID tag through the metal shell of a car.  Others suggest 100% read rates using the latest generation of tags at item level.Slide 25:In Conclusion  One source states: “…international trade tops $8 trillion (£4.08 trillion) in imports and exports, effective and efficient supply chain management translates into improved return on assets and a distinct competitive advantage.”  So, any tool which can help to maintain an efficient supply chain is one which will be welcomed with open arms.Slide 26:In Conclusion: My Stance  In answer to the topic of the seminar, my answer is yes.  RFID is already making huge waves.  The easier question to answer is ‘will’, the more difficult to pinpoint is ‘when will it?