Pervasive / Wireless e-business

IBM RFID Solutions IT Solutions for Business Value
Jean-Michel Corrieu IBM Europe, Pervasive/Wireless e-Business Technical Sales Manager

May 25th

What is Wireless Computing

“A billion people will interact with a million e-businesses via a trillion intelligent interconnected devices”
– Louis V Gerstner, Jr., 1999

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e-business on demand

Any device Page 3 e-business on demand .

   => RFID is small enough. 4 4 4 © Copyright IBM Corporation 2003 . fast enough.e-BSC La Gaude What makes RFID relevant now?  After decades of technology refinement these radio tags have now become very small and inexpensive A great deal of innovation has brought us to the point where the silicon core of an radio tag is now 0. and cheap enough to do real work with today.25 in quantity.4mm The antenna can be printed onto a product’s packaging at time of manufacture Currently radio tags can be purchased for less that €0.

e-BSC La Gaude RFID enables End to end IT Solutions (Auto ID drawing) 11 et rn te In ONS Server Internet Product Information (PML Format) 12 Antenna Write data to RF tags Items with RF Tags RF Antenna Reader Read Manager Transaction Data Store Application Systems Trading Partner Systems 1 2 3 4 5 6 7 Tag/Item Relationship Database 8 9 EDI / XML 10 5 5 5 © Copyright IBM Corporation 2003 .

intensive research is being conducted both at the theoretical (e. antenna design) and manufacturing (e.g. even if the cases are made of RF-friendly materials  The number of tags that can be simultaneously read/written is limited to about 50 – 100 / second  The following environmental factors can hamper proper reading: - Speed with which the object is moving Human bodies (composed largely of water) Presence of RF interference.. processing techniques) 6 6 6 © Copyright IBM Corporation 2003 . carbon  RF can penetrate only up to a limited depth of a material.e-BSC La Gaude Progressing…… but still not perfect  Does not work well if the tagged object is made of RF opaque material like metals. So it may be impossible to read all the case tags of a pallet..g. several type of liquids. material used. moisture and metals  Tag technology is not mature.

and errors in redundant data reads  Real gains in productivity by better managing the use of skilled resources through automation  Industry recognized qualitative impacts which returns improved customer service. lost inventory.  Driving regulatory impacts through compliance activities to meet governmental regulations  Automated POS means skilled resources are in front of your customers – and not behind a cash register 7 .RFID: an ENABLER for Business Value  Measurable impact to labor costs  Real reduction in errors via automation – reduction in misshipments. lessened warrantee handling.

Aligning RFID to business strategy is dependant on the forces that are driving change . DoD. etc. Walmart)  Replace or supplement existing barcode systems/applications  Increase accuracy and decrease error rates of existing applications (inventory management.) Low Low Source: IBM Business Consulting Services analysis 8  Transform operating/business models  Enable new sources of revenue  Enable collaboration with external clients/suppliers  Maintain item historical records (where it has been and what it has been through)  Track/Trace goods throughout the value chain both internally and externally High .g.multiple factors influence how a particular company might view RFID High TRANSFORMATION Opportunities & Benefits OPTIMIZATION  Increase throughput  Reduce labor requirements  Enable Warehouse Management  Enable JIT manufacturing/logistics  Enable real time decision support  Provide internal track/trace of goods/people  Automate and speed processes (e.g. cross docking) Complexity COMPLIANCE  Meet minimum requirement (e.

Developing an RFID strategy – Looking for BUSINESS VALUE Strategic  How can RFID enable our overall strategic vision?  Should we be a leader or a “fast follower”?  Which trading partners should I pilot with and when?  How will we operate in a world of dual processes? And for how long? Organizational  What are the change management implications?  What are the risks involved in an RFID implementation? Financial  What is the expected return on our RFID investment?  What specific RFID applications can drive value for us?  What is a realistic adoption pattern/rate of RFID and how will that impact my business case? Technological  What are our technology requirements for an RFID implementation?  What is the architecture that best delivers on my strategic technology plan?  How will an RFID implementation impact our current applications? 9 .

Business Value On Demand Operating Environment An IT operating environment optimized for flexibility and resilience sP es sin Bu Innovative business designs that sharpen focus and accelerate growth s se es roc Business Business Transformation Transformation Integrated. end-to-end business processes that are built to change Based on real customer cases with real business processes Page 10 e-business on demand .

Extending On Demand e-business systems Securely connecting the Physical Plant / Operational Environment to the IT / Business environment to allow customers to aggregate. analyze and act upon data to dynamically adjust operations in response to changes in their business environment Aggregate Analyze Physical Environment On Demand Infrastructure Act Enable operational control systems to be integrated with Business Knowledge in IT Systems. Next Generation Pervasive Technologies 11 . using open standards-based.

RFID Across All Sectors RFID across industry sectors Industrial Healthcare Retail/CPG Government Logistics Field Service 12 .

IBM’s Divisions Supporting RFID Industry (S&D. BCS) RFID Focussed IGS Consulting Services RFID Trained Tech Group SWG Software Group • Solution Development • Alliances Systems Group Personal Systems Group Sensors & Actuators  Software Development  Alliances  Standards Bodies WW RFID Focused Community Pervasive/ Wireless EBO Research 13 Strategy Solution Development Thought Leadership  Alliances Standards Bodies FOAK Solution Development IBM has a matrix. non-hierarchical teaming approach to RFID .

Logistics Asset Mgmnt Security Shrink Mgmnt Track & Trace Counterfeiting Business Process Partner Performance VMI/SMI CPFR/ SC Collabor Production Planning Websphere Business Process Modeling / Workflow Process Integration Architecture Websphere Business Integration Websphere Business Integration For Collaboration DB2 Order Mgmnt System Item Master File Db2 Integrator Internal Catalog / PIM/PML Communication & Connectivity Management Directory RFID Middleware Server Auto-ID Enablement RFID Edge Server Reader Reader Reader RFID Edge Server Reader Reader Reader Auto-ID Tags 14 WBC Gateway Registry External Catalog /ONS /Data Pool/PML External Data Acquisition Partner Collaboration .IBM’s View – RFID will deliver value in the context of current mission critical business processes Strategy Services SC Planning Business Case Strategy Assessment Pilot Definition Partners Exchanges WPS Portal CRM Promotion Mgmnt Assortment MgMnt Price Optimization Targetted Marketing SC Execution SC Event Mgmnt Warehouse Mgmnt Order Management Trans.

IBM laboratories worldwide .8 research centers focused on RFID advanced learnings. 3 testing labs Almaden Yorktown ISL Hawthorne Zurich ISL Zurich Beijing IBM RFID Testing Labs Gaithersburg La Gaude Austin Haifa Delhi Tokyo 15 .

Customer Reference: Supply Chain: IBM Fishkill Plant Challenge • $2. and order routing during retooling or maintenance accelerating time to market • RFID has enabled IBM’s 300mm fab to run with 60 to 70 people compared with an industry average of 100 to 120.know where its been. are associated with the ID in the Factory Control System's DB2 database • The transponder is read at every processing step to validate that the correct container and material are going to the correct process tool result • Fabs moved from infrared systems to RFID allowing real-time vs. processing of specialty orders.5B Corporate 'from scratch' investment in 300mm Manufacturing and Development. wafer or recepticle. Fishkill then made the decision to use RFID after assessing barcode and infra red systems. point to point tracking of wafer containers (on average 25 wafers in each container) providing true track/trace capability • RFID enabled increased efficiency. process tools and manufacturing facilities . and reduced labor requirements • RFID systems facilitated prioritization of orders. Their challenge was to create a real time.g.all of which are very valuable ($1K per container holding goods worth ~$2M). where its going and its history • IBM software is used to create and write the ID to all new containers • The contents of the container. holidays) Solution Benefits 16 . common container tracking system • Every container has an integrated passive RFID tag with a unique ID (common across all IBM sites) . decreased error rates. The plant needs to use thousands of different active containers for different functions that are transferred from storage area. allowing IBM to add value to its products without necessarily adding cost • With automation enabled by RFID. IBM is able to run the plant with skeleton crew when normally they would shut it down (e.

 IBM in collaboration with Intel and SAP have been involved in technology selection and implementation. Metro Group Future Store of the Future says “The tremendous success of the Metro 'Future Store Initiative' is also driven by IBM's contribution to this innovative project. The initiative helps Metro track and manage grocery store inventory from the distribution centre to and within the retail store environment  IBM have provided business consulting. Executive Project Manager." Solution Benefits 17 . In particular IBM developed a RFID Middleware and integrated a complex RFID solution with multiple functions on pallet.  Metro has decreased misorders and lost inventory due to accurate visibility of inventory from the distribution centre to the retail store  Real-time tracking of retail store inventory helps Metro order new inventory on-demand. hardware and support. case and shelf level. improving customer satisfaction  Dr.Customer Reference: Supply Chain: Metro Group Challenge  The Metro Group Initiative has been up and running since April 28. middleware. implementation. Gerd Wolfram. 2003. reducing “OOS” (out of stock) situations  POS checkout locations are monitored and staff added during peak hours to avoid customer bottlenecks  Customers have instant access to information about products from kiosks located through the store.

The savings will be used to reinvest in competitive advantage and growth. in turn. all customer direct ships (cartons) in AP from the PSK location. Solution Benefits 18 . The project provides near real-time inventory visibility to the Philips Semiconductors business units. drive increased inventory turns • The project is initially between the Philips Semiconductors Kaohsiung (PSK) site and the Regional Distribution Center Hong Kong (RDC HK) on all packaged quantities and boxes. all cartons sent from the RDC HK to all destinations and for EXEL (3PL) all outbound flows in Hong Kong • IBM provided an end-to-end solution that encompasses: • Services to support Philips Semiconductors in the STAR proof of concept project approach will be delivered during the following project phases (total duration 30 weeks). IBM proprietary radio frequency identification (RFID) framework and documentation •IBM software licences: •DB2 UDB Enterprise Edition (including one year maintenance) •2 Websphere studio application developers for the proof of concept (including one year maintenance)  This project will help PSC to further optimize its supply chain and is another step in the route to become an on demand company. It will also enable changes to policies in production and inventory planning systems which will.Customer Reference: Supply Chain: Philips Semiconductors Challenge • The objective of the project was to help Philips increase inventory turns. in particular: •Vendor selection •Design and validation •Construction and testing •Targeted launch •Evaluation • Intellectual property services components.

The DoD is currently preparing to read RFID tags at key sites within their supply chain. IBM is working with the Department of Defense to: –Develop test pilot milestones and manage test pilot requirements –Create project metrics and reporting –Build a business case analysis of the overall RFID implementation –Monitor implementation issues and resolution –Assist in the development and release of RFID business rules –Establish commercial best practices –Provide Subject Matter Experts to develop the short term and long term implementation plan IBM seen as trusted brand for US DoD Solution Benefits Benefits 19 . 2005. Beginning January 1. Department of Defense is dedicated to becoming an early adopter of Radio Frequency Identification (RFID) technology. pallet.Customer Reference: Supply Chain: US Department of Defense Challenge Challenge  The U. and Defense Department Unique Identifier (UID) item packing level.S. the Department of Defense has mandated that all suppliers place passive RFID tags at the case.

Customer Reference: Supply Chain: Sara Lee Challenge Challenge  Major field trial in RFID USA  Step 1 pilot at one DC in compliance with Wal-Mart Mandate  Integrated to WMS  Step 2 roll-out in 2004 to more DCs (5 to 30) Solution IBM chosen as RFID System Integrator and RFID Software Infrastructure and Applications Provider Solution uses Alien UHF tags and readers and Zebra and Printronix printers Benefits Different RFID Use Cases RFID Picking/Labelling RFID Goods Outbound Order verification at case level Load verification Benefits 20 .

Integration and Professional Services Leverage IBM and non IBM Components Build a strong RFID ecosystem of Partners Support and drive open standards 21 . How do we Help Companies : Deliver Business Value Focus on key industries Develop end-to-end solutions Provide Consulting.In Short.

IBM: a leader in mobile and wireless computing The Yankee Group ranked IBM # 1 in March 2003 “IBM ranks first among the enablers of enterprise mobile computing solutions” “IBM also boasts the most successful professional services business (IBM Global Services) in the mobile computing space” A mid-2002 IDC report shows IBM and PwCC Wireless jointly have close to a 30% market share. are over 5 times the nearest competitors. One could be shocked by seeing how far ahead IGS is” 22 . “IBM Global Services (IGS) is by far the leading provider of mobile and wireless professional services. and when combined.

 http://www.asp?pmillid=16933 23 .amrresearch. and implementation expertise. IBM is providing strategic direction. It will also establish an RFID lab in Germany to test supplier interoperability in all stages of the initiative.com/Content/view. consulting.  The Takeaway: IBM is emerging as the leader in RFID integration and consulting services.AMR Recent assessment of IBM  January 2004 release with Metro on Store of the Future and IBM's involvement  IBM--The overall systems integrator on the project.