RFID Help From The Outside

Small and midsize companies are turning to systems integrators and consultants to help them design, test, and implement RFID initiatives

Laurie Sullivan, Contributor

March 25, 2005

3 Min Read

A Microsoft SQL Server database houses the information collected by readers and bar codes from harvesters in the field and RFID-scanning portals in the distribution center. "We're still in the preliminary stage of trying to develop reports and determine how to use the data," says van der Bijl, the lead developer for Tanimura & Antle's RFID program. This data eventually will help create new business processes. "When we can track [via RFID] what time a product is harvested in field A versus field B, we can make a process decision on which product will ship first," Casas says. "With these decisions, we can improve the product's quality."

Midsize companies aren't alone in their need for outside help with RFID. H.J. Heinz Co., a consumer-goods company with about $10 billion in annual revenue, knew it lacked the expertise and physical resources to complete its RFID project and comply with Wal-Mart's request to begin shipping RFID-tagged goods by this past January.

So in June, Heinz hired IBM Global Services. In spring 2004, IBM helped Heinz draft a business case by examining its internal business processes and outlining possible uses for for RFID, both now and in the future. The resulting document details cost estimates, the technology's evolution, and the potential savings and strategies for Heinz in the future. "That is the benefit of working with a consulting firm or systems integrator," says Doug Ostrosky, Heinz's RFID program manager.

Identifying business processes affected by RFID and building a team to work with the technology are critical to an RFID implementation's success, says Eric Gabrielson, director of worldwide RFID solutions for IBM Global Services. "Now you have the model, it's important to develop the road map," he says. "Understand near-term and long-term changes that will take place and how to eliminate problems. It's important to understand all of the different pieces that will affect the project, such as the data around cost and savings."

Once the business case was completed, IBM Global Services helped Heinz test the processes. Pallets stacked with cases containing ketchup bottles, bags of frozen potatoes, and jars of spaghetti sauce were shipped to IBM's lab to test how various tags would react to the liquid, plastic, and metal in those products. The tests were completed, and Heinz has since set up a testing center in a Dallas distribution facility comanaged by a third-party logistics provider.

The business case helped Heinz develop a step-by-step plan that calls for Heinz to outfit a production line with an RFID-tagging station at each of its 10 manufacturing plants throughout North America.

The consumer-goods company also is taking lessons learned from its compliance tests with Wal-Mart to figure out how to apply RFID internally. The goal is to track reusable containers used to transport raw materials that today are monitored but with uncertainty. Asset tracking is a step toward automating inventory replenishment to restock spices, tomatoes, and other materials as they're consumed. "Our relationship with IBM has helped us to think differently," he says.

Thinking differently in Bradshaw's case meant the difference between ripping out investments and investing wisely.

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