The EPCglobal Network was developed by the Auto-ID Center, an academic researchproject headquartered at the MassachusettsInstitute of Technology (M.I.T.) with labs atfive leading research universities around the globe. The EPCglobal Network is a set of technologies that enable immediate,auto-matic identification and sharing of informa-tion on items in the supply chain. In that way, the EPCglobal Network will makeorganizations more effective by enablingtrue visibility of information about items inthe supply chain.
Wal-Mart, the world’s second largest com-pany, is deploying RFID technology in itsstores. “Wal-Mart is positioning itself at thefront of an inevitable technological revolu-tion, even if it means dragging others into afuture they’re not sure they want,” saidDillman, Chief Information Officer, Wal-Mart.
Furthermore, Dillman states, “I had no idea we’d get a reaction like this.But the fact that this is happening in publicdoesn’t change our focus on making sure ithappens.” Dillman is referring to someresistance from consumer advocates whoare concerned about privacy issues andsuppliers who are concerned about the fair cost for their end of the technology – theRFID tags. The Department of Defense is embracingthis emerging technology as well. “TheDefense Department recently announced it would require its suppliers to use wireless3tags based on radio frequency identification(RFID) technology by January 2005. Thepolicy calls for Defense Department suppli-ers to put RFID tags on the ’lowest possiblepiece‘ - each part, case or pallet, for exam-ple - and pertains to all items except bulk commodities such as gravel. The goal is bet-ter inventory management through faster,hands-off processing.” The Department of Defense purchases not only just multi-milliondollar military equipment, but over $20 bil-lion dollars in consumer products and isseeking to make the supply chain more effi-cient.
Companies like Microsoft, IBM, and PhilipsElectronics, which recently made productenhancement announcements in this area,are also participants in the industry. “IBM, in Armonk, New York, and Philips, in Amsterdam, will team on RFID for supply chain management, retail and asset manage-ment, as well as smart card technology for finance, e-government, transportation andevent ticketing.” the company said. “As partof the joint effort, IBM Global Services willbuild an RFID system for use in for Phillips’semiconductors facilities for manufacturingand distribution in Taiwan and Hong Kong.”7
Efficiency Gainsfrom RFID
As mentioned above, large organizations,such as the Department of Defense, arelooking to improve their supply chain man-agement and reduce labor, errors, and han-dling costs.