Date post: | 15-Jan-2016 |
Category: |
Documents |
View: | 215 times |
Download: | 0 times |
Pervasive / Wireless e-business
Dec04
Emerging Markets
IBM RFID Executive Overview
Faye HollandWW RFID Solution LeaderPervasive/Wireless e-business
2
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Contents
What is Radio Frequency Identification (RFID)? What is the market opportunity for RFID? What is IBM’s play in the RFID space? What are the IBM Market Spaces for RFID? Why IBM?
3
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Building an effective RFID enabled business solution requires a fundamental understanding of the technology
What is RFID? A means of identifying a unique object or person using
a radio frequency transmission
Tags (or transponders) that store information, which can be transmitted wirelessly in an automated fashion
Readers (or interrogators) both stationary and hand-held read/write information from/to tags
RFID: The fundamentals
IntermecUAP-2100
Tags
Reader
How does it operate? RFID tags are affixed to objects and stored information
may be written and rewritten to an embedded chip in the tag
Tags can be read remotely when they detect a radio frequency signal from a reader over a range of distances
Readers then either send tag information over the enterprise network to back-end systems for processing or display it to the end user
4
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
RFID Basics
Tags Active - Includes a power source to help transmit a signal Passive - No power to transmit signal; relies on readers Semi-Passive - Not generally available as yet Frequency - Radio wave frequency at which signals are
transmitted (Telephone example: 900 Mhz, 2.4 Ghz, 5.8 Ghz)
Data Capacity - Many options, will depend on application Antenna - Device attached to tag to help capture
reader signals
Readers Reader - Interrogators that typically emits a radio
signal via an antenna and collects information that is captured from “scans” using some form of “controller software”
Antenna Device attached to a reader which helps transmit radio signals and capture “scan” readings
5
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Examples of RFID tags from different vendors
Intellitag 915 Mhz tags from Intermec Technologies
Family of low-frequency tags from Texas Instruments
2450 Mhz Backscatter tag from Alien Technologies
Spider 2450 Mhz tag from RFCode
Smallest 13.56 Mhz EPC tags from TagSys
13.56 Mhz tag with largest storage capacity (4KBytes) from Hitachi Maxell
6
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
EPC Tag Classes• Protocols have been developed for class 0 and class 1 tags, standards for the other classes of tags
are under development in EPCGlobal. Class 0 and class 1 tags will be used in the various mandates from Retailers.
• Class II tags are expected to reach the market in late 2004, early 2005
• Achieving a unified communications protocol for Class 0, Class 1 and evolving these to higher classes is a critical factor in spurring demand
Class Type Comments
Class 0 Read only passive identity tags Factory programmable (64 bit only)
Class I Write once passive identity tags WORM with provisions for read/write (96 bit
min.)
Class II Passive tags with added functionality, e.g. memory
or encryption Shorter range (i.e. 4”-18’) Read/write (multiple), user memory
Class III Semi-passive RFID tags Battery Assisted – reader activates, battery powers
Medium range (i.e. 10’-50’) Read.write, user memory, sensors, encryption
Class IV Active tags – communicate with readers and other
tags on the same frequency band Active – battery powered
Long range (i.e. 300’) Read/write, user memory, sensors, etc.
Class V Essentially ‘readers’ – can power class I, II and III
tags, as well as, communicating with class IV and with each other
Generat ion
2Source: Auto ID Center/EPCGlobal; Intermec
7
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Tag Frequency
There are a number of RF ranges for tags, including: 100-140 kHz, 13.56 MHz, 862-928 MHz, 2.45 GHz– each have very specific market applicability
Frequency Capabilities Applications
125 kHz
Read Range - up to 18"Good Penetration in Moist EnvironmentsSlow Data RangeCostly TagsNo Anticollision
Pallet/containerRPCWindshield decalLabel insertsCredit card
13.56 Mhz
Read Range up to 3'Good Penetration in Moist EnvironmentsPoor Performance in Metal EnvironmentsMany Standards in Financial MarketAnticollision (10-40 tags / sec)
Pallet/containerRPCWindshield decalLabel insertsCredit card
869, 902-928 MHz
Read Ranges up to 15'Fast Data RatesGood Performance in Metal EnvironmentAnticollision (50 tags / sec)Many Standards in Logistics / Supply Chain
Metal mountLabel insert
2.45 GHz
Read Range up to 3'Good Performance in Metal EnvironmentsPoor Performance in Moist EnvironmentsFast Data RatesAnticollision (50 tags / sec)
Metal mountLabel insertHardened tag formatReusable form factor
8
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
RFID Reader Technologies
There are three basic choices for reader technology – based on the job or type of work to be performed
Entrances - portalsConveyors across
assembly linesPoints of saleOverhead
StationaryHand-heldWireless or batchOne-piece or two piece
tagging
MobileMobile service agent
PCMCIA
9
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Examples of RFID readers from different vendors
1555 Handheld serial readers from Intermec Technologies
303.8 Mhz Mantis wireless LAN reader from RFCode
S6410 Serial reader from Texas Instruments
902-928 Mhz serial stationary reader fromMatrics
915 Mhz Network stationary reader (with antenna) from Alien Technologies
10
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Tag and reader costs projected over time
Purchasing Curve 2002 2003 2004 2005 2006
Industry tag sales (millions of units)
150 500 1,200 3,500 15,000
Tag price to highest volume users
$0.30 $0.25 $0.15 $0.10 $0.05
Industry reader sales (millions of units)
0.1 0.3 0.6 1 2
Reader electronics price to volume users
$500 250 150 125 100
Source: AMR Research
RFID –purchasing curve
11
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
World Wide Challenges for RFID
Europe:862 – 870 MHz (869
MHz 0.5 W)
Middle East:Potential for
862 – 870 MHz
China:Permissive 915 MHz
Australia:915 – 927 MHz
1 Watt
New Zealand:915 – 927 MHz
1 Watt
Japan:950-956 MHz
Potentially available
Pacific Rim:Singapore 862 – 870 MHz, Taiwan
915MHz
Northern Africa: 862 – 870 MHz
(869 MHz)
US and Canada:902 – 928 MHz
4 W
South America:Undefined but 915 is typically
accepted
Mexico:Typically 915MHz, Case
by case basis
Southern Africa: 915MHz Typically permit FCC
approved devices(902 – 928 / 4 W)
StandardsEPC
ISO
ucode
TagsCost
Durability
Packaging
Weight
Materials
FrequencyFrequency
Power Level
Duty Cycle
All Evolving
12
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
…and are already in limited use across several industries
RFID tags have many advantages over the barcode…
RFID has not yet been widely adopted due to high implementation costs and a lack of standards – industry leaders are combining their efforts to address this issue
Military containers: 250,000 containers are monitored for the Department of Defense
Automotive: Inventory Management at Ford
Baggage Handling Logistics: San Francisco Airport, Swiss Federal Railway
Mobile Assets: Singapore has tagged cars for road taxation, American “I-pass” prepaid highway toll systems
RFID tags are the next step after barcodes
Barcode/ UPC RFID Tag/EPC
Efficiency Ability to read one tag at a time (line of sight required)
Ability to read multiple tags simultaneously (no line of sight required)
Dependability Labels easily damaged Tags less susceptible to damageCan be used in harsher environments
Data Capacity Limited amount of data can be assigned
Significantly higher data capacity to capture detailed information about productAccuracy close to 100%
Flexibility Static information Potential for read/ write capability, making tags reusable
13
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Electronic Product Code (EPC™) Vision: pen standards for pervasive product tagging
The EPC vision uses low-cost RFID radio tags and readers to uniquely identify and track objects to improve inventory visibility and reduce costs throughout the value chain
Real-time information related to each object is stored and accessed via the internet
It is an open, standards-based system that facilitates collaboration among partners in the value chain
IBM is actively involved in defining the future of EPC vision through the EPCglobal organization
The Auto-ID system is not a stand alone solution or service offering, but rather a key enabler to current and envisioned initiatives within the value chain
Prototype Auto-ID radio tags
14
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Accenture ACNielsen Alien Technology Avery Dennison AWID British Telecommunications (BT) Cash's Catalina Marketing Corp Checkpoint Systems, Inc.ConnecTerra, Inc. Ember Corporation Embrace Networks Flexchip AG
Technology Board Members
Smurfit-Stone Container Corp Target Corp. Tesco Stores Ltd. The Gillette Company Toppan Printing Uniform Code Council Unilever United States Postal Service UPS Visy Industries Wal-Mart Stores, Inc. Wegmans Food Markets, Inc. Westvaco Yuen Foong Yu Paper Mfg. Co.,
Abbott Laboratories Ahold, IS Best Buy Corporation Canon Inc. Carrefour Chep International Coca-Cola CVS Dai Nippon Printing Co., LtdDepartment of Defense Ean International Eastman Kodak Gillette Home Depot
International Paper Johnson & Johnson Kellogg's Corporation Kimberely Clark Corporation Kraft Lowes Companies, Inc. Metro Mitsui & Co, Ltd. Nestle Pepsi Pfizer Philip Morris USA Procter and Gamble Company Sara Lee
Board of Overseers
Flint Ink GEA Consulting GlobeRanger IBM IDTechEx Impinj, Inc. Information Resources, Inc. Intel Intermec Invensys PLC Ishida Co, Ltd. KSW Microtec AG Manhattan Associates
Markem Corp. Matrics Morningside Technologies NCR Corporation Nihon Unisys Ltd. Nippon Telegraph and Telephone NTT Comware OATSystems Omron Corporation Philips Semiconductors Rafsec RF Saw Components SAMSYS SAP
Savi Technology Sensitech Sensormatic Electronics CorpSiemens Dematic Corp. STMicroelectronics Sun Microsystems Symbol Technologies TAGSYS ThingMagic Toppan Forms Toray International, Inc. Vizional Technologies Zebra Technologies Corporation
The sponsors of EPCglobal are come from multiple industries and geographies
15
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
EPC™ - variable length product identification code
Header Domain Class Instance
EPCglobal – commercializing the Electronic Product Code
The base of the EPC vision is the Electronic Product Code – a robust labeling convention that is embedded into each radio tag
What is the EPC™?A product numbering scheme
Created by the Auto-ID Center
Managed by EPCglobal
How is it different from today’ UPC barcode number?Variable length
Supports multiple industries
Uniquely identifies every single item (unique serial number)
16
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
RFID Standards
Auto ID / EPCglobal Standards Compliance is a Strategic IssueCustomers demand AutoID/EPCglobal compliance
Significant support and participation from Retail/CPG players
IBM has minimal influence on the board of this organization
IT companies have issues with EPCglobal’s IP policies
Software and data standards for connecting readers and applications
Tag data enrichment through object lookup WW standards needed for RF technology and tag data formats
RFID Air Interface standard for item management (ISO 18000 part 6)
Information interface for object orientated use of RFID in item management (ISO 15961/62)
Application standard for the use of RFID in the macro-supply chain (EAN/UCC GTAG)
Application standard for tire and wheel identification (AIAG) Data privacy and ownership issues and regulations emerging National, international and industry standard organizations require monitoring to ensure
environment supportive of IBM technologyANSI, IEC, ISO, EIA, AIAG, TCIF, ATA, GS1, EPCglobal
17
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
RFID is an On Demand Technology Enables end-to-end business process integration
Recognition of real-time transactions/ actions of an object, via an automated system.
Decrease of redundant recording processes and data reads
Automation of manual processes
Streamlined processes and improved order turnaround Automates response to customer demand, market opportunities, and external
eventsRecognition of alert events or special condition
Forecasting and real-time inventory diversion
Improved supplier and customer relationships (vendor direct, manufacturer, retailer, consumer)
Just-in-time manufacturing
RFID helps to operationalize manual processes and read dynamic conditions across intermittent conditions.
PC card readers
18
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Contents
What is Radio Frequency Identification (RFID)? What is the market opportunity for RFID? What is IBM’s play in the RFID space? What are the IBM Market Spaces for RFID? Why IBM?
19
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Worldwide RFID Market
0.00
1000.00
2000.00
3000.00
4000.00
5000.00
6000.00
2003 2004 2005 2006 2007 2008
US
$ M
Readers
Tags
Hardware
Software
Services
Significant market opportunity exists, with the IBM opportunity representing $3.1B by 2008
Based on estimates from Venture Development Corp., ABI, Yankee Group, and AMR, IBM estimates the RFID market compound annual growth rate at approximately 34%
IBM estimates total market for 2004 to be $1.5 billion
Recent market triggers such as Wal-Mart, Tesco, U.S. Dept. of Defence, Target decisions to implement RFID systems are expected to accelerate market adoption
Source: IBM estimates using inputs from Venture Development Corp., ABIYankee Group, AMR
$1.3B$1.5B
$2.2B
$3.4B
$4.3B
$5.3B
20
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
WW RFID IBM Addressable Market Opportunity by Geo
0
500
1000
1500
2000
2500
3000
US
$M
AP
EMEA
Americas
AP 152 179 263 443 566
EMEA 232 257 364 629 809
Americas 246 304 483 870 1127
2003 2004 2005 2006 2007
RFID WW IBM Addressable market opportunity differs by Geo; several drivers explain the growth
EMEA Drivers Retail initiatives (Tesco, Metro) Cross industry adoption occurring Increasing user acceptance Cross-border shipping Government regulations
AG Drivers US Government mandates Retailer initiatives (Walmart, Target,
Albertsons) Automotive, A&D, and Government
industries are extending the adoption rate
AP Drivers Expansion of suppliers in the region Adoption of radio frequency in Japan and
China Expectations that Australian Defense
Force will follow US Govt. lead Government and electronics industries
becoming more of a focal point
Source: IBM estimates using inputs from Venture Development Corp., ABIYankee Group, AMR
$.6B$.7B
$1.1B
$1.9B
$2.5B
21
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Market Drivers
Market Increasing end-user knowledge of RFID technology, its applications, and its advantages over traditional methods of data-capture Emerging and growing markets for different RFID applications across multiple industriesDemand driven by large retailer requirements, CPG and supply chain vendors’ investmentIndustry systems integration and process expertise developingBusiness pressures driving adoption are intensifying -- supply chain enhancement, asset exposure, regulatory pressures
Economic Falling equipment prices and improved performance resulting in better price-to-performance ratio Rapidly decreasing cost of RFID tags and readers
Physical/ Technical Technology is beginning to matureTechnical and physical interoperability, interference and data overload issues will be overcome through 2004-2005Enterprise middleware will embed RFID middleware to sustain/grow market presence“Agile readers” emerging -> able to read multiple tag protocolsChip and frequency standards are expected to evolve globallyActive tags will be increasingly evolve over time requiring unique solutions
Standards Industry-wide standards for many applications leading to interoperability amongst different manufacturers’ products, including hardware
Social/ Political Government requirements for cross-border trade Regulatory mandates Safety and security concerns has increased
Sources: IBM, Venture Developmentt Group, Frost & Sullivan, BRG Townsend, The Yankee Group
22
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Market InhibitorsMarket Availability of skilled RFID experts
Over hyped value propositions, business cases, and timelines Data ownership and security A multitude of vendors with fragmented approaches Confusion as to providers who have a WW presence and delivery capability
Economic RFID tags are still expensive compared to barcodes (approx. $0.25)Implementation and back-end integration costs are very high ROI may not be immediateBalance of benefit across the trade relationships
Physical/ Technical Country-specific idiosyncrasies in regards to spectrum bandsFor wide-spread adoption, tag costs must drop below $0.05 Tag and reader incompatibilities still exists between rival manufacturersRead reliability still needs improvement. Heavily dependent on business application and tag placementRFID signals can be blocked in certain environments (e.g., liquids, metals)Data loads produced by RFID systems could overload company systems
Standards Lack of flexible and global standardsClass 1 Generation 2 tags not available until late 2004/early 2005; EPC and ISO standards at odds until thenCross-company data sharing model has not been defined.
Social/ Political End-user acceptance: Privacy, for example, remains a concern
Sources: IBM, Forrester Corporation, Frost & Sullivan, BRG Townsend, Bear Stearns, The Yankee Group
23
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Achieving an RFID-enabled supply chain will take some time
Ongoing Challenges
Physics
– Read reliability – depends on tag placement, environment, application
– Metals and liquids Standards
– Tags and Readers
– Cross-company data sharing model Economics
– Tag cost reduction is critical
– Confirming the benefit potential when dependent upon trading partners Data Ownership and Security
Consumer Privacy Concerns
24
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Lessons Learned - RFID Business Cases
Every Business case is different– “Pain Points” (e.g Do you really have a shrink or counterfeiting issue?) – Distribution method ( e.g. full pallet vs. mixed vs. innerpacks)– Process capabilities– Trading partners– Product margins and brand loyalty
May need to look beyond your own four walls for significant opportunities
Need to consider the transition – Trading partner adoption over time – Decreasing costs ( tags, readers, software, etc)– Transitioning from one tag application strategy to the next
Think strategically...but balance with operational realities
25
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Lessons Learned - Pilots
Physics matters !– Tag placement on products
– Existing RF and wireless networks
– Environmental factors – Static, handling, temperature, condensation, etc
Successful deployments require planning–Testing tags and readers
–Procuring hardware
–Network and power considerations
How will you measure success ? –Read reliability metrics
–Data integration
–Cost and benefits assumptions validated
Not enough detailed discussion on cross-company data sharing
26
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
RFID discussions start about compliance and quickly move toward how to take transformation solutions to customers
Compliance
Transformation
Optimization
Low
High
Op
po
rtu
nit
ies
& B
en
efit
s
Low Complexity High
Enable new revenue sources through partnership
Data enabled services
Transform operating and business models
Meet minimum requirement
Replace or supplement existing barcode systems
Increase accuracy of existing applications
Optimizing logistics
Reduced labor
Enable warehouse management
Enable JIT manufacturing
Real-time decision support
Automate and speed processes
Visibility
Visibility through Value Chain
Enable collaboration with external clients and suppliers
Maintain full record of item history and touch-points
Track and trace materiel through the full value chain
27
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
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?
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?
Organizational
What are the change management implications?
What are the risks involved in an RFID implementation?
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?
Developing an RFID strategy
28
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Contents
What is Radio Frequency Identification (RFID)? What is the market opportunity for RFID? What is IBM’s play in the RFID space? What are the IBM Market Spaces for RFID? Why IBM?
29
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
The strengths of IBM
The world’s largest information technology company; the world’s largest business and technology service provider ($42.6 billion); and the world’s largest IT financier ($35 billion in assets)
$89.1 billion in annual revenues in 2003
Net income of $7.6 billion in 2003
Total assets of $104.5 billion in 2003
316,000 employees worldwide
With operations in over 160 countries worldwide
30
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
IBM business unit overview
FinanceBankingFinancial MktsInsurance
DistribusionCPGRetailTravel &
Trans
IndustrialAutomotiveElectronicsChem & PetroAerospace
CommunicationsTelecommUtilitiesMedia &Entertainment
PublicGovernmentHealthcareEducation
Sm
all &
Me
dium
Bus
ines
s
Bus
ines
s C
onsu
lting
Ser
vice
s
Inte
gra
ted
Tec
hno
logy
Ser
vice
s
Str
ateg
ic O
utso
urci
ng S
ervi
ces
App
licat
ion
Man
agem
ent
Ser
vice
s
Per
vasi
ve C
omp
utin
g S
W
Mic
roel
ect
roni
cs
Sto
rage
Sys
tem
s
Op
erat
ing
Sys
tem
s
Col
labo
rativ
e C
om
putin
g (
Not
es)
Tra
nsa
ctio
n P
roce
ssin
g
Dat
abas
es
Ap
plic
atio
n S
oftw
are
Sys
tem
s M
ana
gem
ent
PersonalComputers
PrinterSystems
X-Series
P-Series
I-Series
Z-Series
Application Development
Tools
ibm
.com
- D
irect
Mar
ketin
g
Bus
ines
s P
artn
ers
Per
vasi
ve/W
irele
ss e
-bus
ines
s
IBM Research
Sales & Solutions Services Products & Technologies
Wireless EBO
31
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Smart Cards/Secure ID is focused on smart chip solutions that provide for the authentication of an individual based on information contained on a smart chip device (smart card, sim card, transponder, etc) carried by that person to allow for actions / transactions either in a “secure” or “non-secured” fashion
1. eCash – spend, loyalty, IRC2. secure id3. toll collection4. smart card / sim card
“Smart Transactions”
1. embedded machines 2. intelligent vending /
unattended retailing3. connected home
scenarios and service aggregator solutions
“Smart Machines”
Embedded Solutions are focused on the remote access / control of appliances and machines via embedded sensors or smart chips that collect and synthesize status
1. supply chain
2. work in process mfg
3. asset management
4. security & access control
5. consumer applications
“Smart Objects”
RFID Tagging offers the vision of a “consumer driven supply network” based on cooperative vendor/retailer business models. Assets are tracked using non-line-of-site RF to identify the object via a unique identifier
RFID TaggingEmbeddedSolutions
AssetMonitoring
Smart Cards / Secure ID
Asset Monitoring is the remote collection of data across networks of community-based assets in the field via embedded sensors or chips which transfer that data across wired/wireless lines to a remote location
1. metering, AMR 2. e-SCADA3. condition monitoring4. predictive maintenance
RFID relates to self-identifying “Smart Objects”, while other smart chip applications relate to smart machines and consumer-initiated transactions
32
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
The IBM Point of View Transform business operations by coupling RFID, a powerful enabling
technology, with process change in areas such as supply chains, asset management and work in process manufacturing
Integrate RFID into your business using a planned approach and learn through using the technology while recognizing standards & technology capabilities will evolve over time
Build a foundation today that you can scale for future growth
Incorporate RFID into your broader strategy for process improvement or transformation such as e-production or Consumer Driven Supply Chain, since “compliance alone will not deliver value”
Gain benefits today by applying RFID capabilities to improve specific business processes
Business transformation drives requirements for a scaleable, flexible, robust and manageable infrastructure
33
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Importance of the RFID Market
Market opportunity will grow to over $2B by 2007 with significant growth rates
Game changing technologyMarket drivers will lead to broad adoption
by 2006 IBM competitors are entering the market
Become the dominant Services and Middleware SW provider in the RFID solutions market, by adding value to our customers businesses and delivering end-to-end solutions
IBM Strategic Direction
Focus on key RFID markets – Supply Chain, Work In Process, Security & Access Control
Focus on key industriesDevelop end-to-end solutionsBuild a strong RFID ecosystemSupport and drive open standards
IBM’s Vision
IBM’s Strategic Direction in RFID
34
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Forrester: “RFID Middleware Vendor Profile: IBM"
"IBM’s strong integration and application development capabilities will make it a good option for firms with a best-of-breed application landscape — particularly those looking for a one-stop services and software offering."
Source: Forrester: “RFID Middleware Vendor Profile: IBM” August 2004
35
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
The AMR Research Risk Assessment Profile lists IBM Global Services as the Leading Service Provider for RFID Deployments
IBM leads or ties with market leaders in seven of eight categories:
Domain Expertise Delivery Expertise Referenceability Internationalization Business Strategy Financial Strength Customer Practices International Capabilities
The AMR Research Report, RFID in Consumer Products: Which Service Providers Have the Goods? May 2004, Kara Romanow and Dana Stiffler
36
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
The AMR Research Risk Assessment Profile lists IBM Global Services as the Leading Service Provider for RFID Deployments
The Bottom Line: AMR Research’s Risk Assessment Profile analysis of the
service providers reveals that no firm can be considered low-risk yet, but
leaders like IBM Global Services and Accenture lead the pack in hands-on
RFID deployments.
IBM Global Services -- IBM leads or ties with market leaders in seven of eight
categories. Higher than average years of CP industry expertise in its core CP
RFID team puts it just ahead of Accenture in Domain Expertise. Where IBM
pulls away from the pack is in its technology expertise, complexity of delivery,
and in referenceability. Its ability to link RFID projects to cutting-edge
DDSN initiatives also sets it apart. References admired IBM’s Business
Consulting Services RFID team for "not falling into a vat of RFID Kool-Aid."
Internationalization and overall International Capabilities scores tie with those
of our other two top global players: Accenture and Capgemini.Source: The AMR Research Report, RFID in Consumer Products: Which Service Providers Have the Goods? May 2004, Kara Romanow and Dana Stiffler
37
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
IDC Leadership Grid: WW RFID Services Market
Source:
IDC Study: "Worldwide and U.S. RFID
Services Competitive Analysis and
Leadership Study, 2004: Disruptive
Technology in Waiting and Why the
Services Value Chain Matters"
38
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
IBM laboratories worldwide - 3 IBM RFID Test Centres
Wireless Enterprise Lab (WEL) :Gaithersburg
La Gaude
Raleigh Technology Lab
Austin Demo Lab
Raleigh WebSphere Integration Centres :
Chicago
San Mateo
Washington
Singapore
Sydney
Boeblingen
Hursley
Paris Global e-business Solution Centre
Dallas Others
Hawthorne
SPC Satellite Centres :Budapest, Hungary Warsaw, PolandTel Aviv, IsraelHelsinki, FinlandSao Paulo, BrazilToronto, Canada
Solution Partnership Centres :Waltham, MA - USChicago, IL - USSan Mateo, CA - USHursley, UK Paris, FranceStuttgart, GermanyShanghai, China Sydney, AustraliaTokyo, Japan Seoul, Korea Bangalore, India
IBM RFID Test CentresGaithersburg
La GaudeYamato
39
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
RFID testing servicesTechnology Providers (tags, readers, printers, middleware)
Customer products (liquid content, metals in product or packaging, foils, special packing problems)
Specific use cases (speed, temperature)
Operating environment (RF interference)
Specs/standards (e.g. Wal*Mart's specs on read rates and distance)
Testing ApproachesYour Target RFID Site
"mobile on site" testingIBM sends our lab equipment temporarily to client locationHelps identify site-specific factors disrupting RFID solutions
Your Lab
IBM assists clients in designing and implementing permanent labs on client premises
Our Lab
IBM RFID Test Center (IRTC) offers full range of cutting-edge RFID capabilitiesLow-cost, entry level optionsClients send pallets to IRTC for series of tests with a broad array of vendors and equipmentClient report benchmarks results for the product, technology, and spec identifiedIBM offers complex RFID system consulting including custom solutions and integration.
IBM’s world class RFID test lab objectives
40
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
IBM’s RFID organization IBM has a matrix, non-hierarchical teaming approach to RFID
Research
Solution Development Alliances
• GTM & Marketing• Customer Deliverables• Industry Alliances
Sean Campbell, Bill Paulk, Jan Jackman
Distribution
Public
Communications/ Financial Services
SMB•
So
luti
on
Dev
elo
pm
ent
• C
ust
om
er D
eliv
erab
les
• A
llian
ces
• M
arke
tin
g
BCSITS
• Solution Development• Alliances
Software Group
Sensors & Actuators EBO Software Development Alliances Standards Bodies
Robert MayberrySesh MurthyAnn Breidenbach
Industry (S&D, BCS) IGS SWG
Industrial
• GTM & Marketing• Customer Deliverables• Industry Alliances
Kal Gyimesi
•GTM & Marketing•Customer Deliverables• Industry Alliances
Bill Phillips, Radha Sekar, Tony Prince
• S
olu
tio
n D
evel
op
men
t•
Cu
sto
mer
Del
iver
able
s•
Alli
ance
s•
Mar
keti
ng
Other
• A
pp
licat
ion
Man
agem
ent
Ser
vice
s• E
-bu
sin
ess
Ho
stin
g•
Str
ateg
ic O
uts
ou
rcin
g
Pervasive/ Wireless EBO
StrategyThought LeadershipStandards Bodies
FOAKSolution Development
Jim
Re
yn
old
s,
K
ell
y U
ng
er,
M
ich
ae
l R
em
en
ter
Je
su
s M
an
tas
, M
urr
ay
Mit
ch
ell
Jo
hn
Ba
ke
r (A
MS
)J
eff
Be
nto
n (
AM
S)
Paul ChouStefan Hild
Eric GabrielsonFaye Holland
Jeff Benton, Tom Motyka, Pat McNabb (AG)
Industry & Solution LabsBlueprints Testing
DemonstrationsPrototypes
41
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
IBM Investments in Solution Development
Multi-million $ Investment Supporting RFID as strategic play
Focused RFID Expertise Pervasive/ Wireless Emerging Business Opportunity
SWG (with unique RFID investments)
Services - ITS and BCS (with additional focused investment)
Research (with additional $ investment)18 Months Experience with Solution Development
Complete, tested and integrated solutions
Keeping ahead of market demand
Industry specific focus
Componentized Middleware Products with RFID Capabilities
Robust scalable infrastructure
Unique extensions for RFID Solutions
42
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
IBM RFID Solutions Architecture Investment
Important to our customers, across industries RFID is a key transformation initiative for consumer products and retail companies “The adoption of RFID technology is inevitable. It’s transformational promise, huge.
But the success of RFID in your business depends on your infrastructure.”1
Domain architecture provides flexibility and scalability to maximize business value capture
Group logically-related technology components Adapt to rapidly changing business and technology needs with minimum disruption Protect IT investments in both new and existing business applications IBM envisions the supply chain as a synchronous response environment
Companies will require a consistent architecture to support triggers from intelligent devices (RFID) and retailers
Insulate layers of technology advancements through loose coupling, flexible & clean interfaces between domains
Support evolving standards (ISO, EPCglobal)
1 Source: CIO Magazine – 12/01/03, The RFID Imperative By Meridith Levinson)
43
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
The End-to-End Component Model is split into specific domains to contain the architecturally significant groups of components
Enterprise & Business Application
Domain
Antenna & Reader Domain
Tagged Object Domain
Security & Privacy Management
EdgeDomain
T
Premises Domain
T
Business Process
Integration Domain
T
Systems Management Domain T
Object Directory Domain
T
Tooling – support for customized business logicT
44
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Enterprise & Business Application
Domain
Antenna & Reader Domain
Tagged Object Domain
EdgeDomain
T
Premises Domain
T
Business Process
Integration Domain
T
Systems Management Domain T
Object Directory Domain
T
IBM plays in many areas of the value chain and partners to provide an end-to-end solution
RFID System Integrators
Hardware Providers
Infrastructure & Storage
Application Management & Strategic Outsourcing
Security & Privacy Management
45
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Enterprise & Business
Application Domain
Antenna & Reader Domain
Tagged Object Domain
EdgeDomain
Premises Domain
Business Process
Integration Domain
Systems Management Domain
Object Directory Domain
The Partnering Strategy Maps to the RFID Solution Domains
AeroScoutAlienAvery DennisonIntermecMeadWestvacoPhilipsPrintronixSaviSymbolTexas InstrumentsWavetrendWherenetZebra
AeroScoutAlien AWID FEIGIntermec MeadWestVaco -
Intelligent Systems
SAMSys SatoSaviSISSymbol TagSYS Texas InstrumentsThingMagicWavetrend WherenetZebra
HardwareArcomEmness
Software.IBM ConnecTerra
IBM ConnecTerraOAT SystemsMeadWestVacoSaviWherenet
IBMERP: SAP,
PeopleSoftWMS: Red Prairie,
ManhattenRetail: RetekPlanning: i2,
Manugistics
IBM VeriSign
IBM
RFID System Integrators Bearing Point, Cap Gemini, IBM Intel, IPI, Intellident
Hardware Providers
IBMInfrastructure & Storage
IBM
Application Management & Strategic Outsourcing IBM
Security & Privacy Management IBM
T
T T
T
T
46
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
IBM RFID Software Solution Architecture
DockDoor
Reader
DockDoor
Reader
ConveyorBelt
Reader
ConveyorBelt
Reader
Handheld /Portable Reader
Handheld /Portable Reader
RFIDLabel / Tag
Printers
RFIDLabel / Tag
Printers
Visual Indicators
Visual Indicators
Switchesand
Sensors
Switchesand
Sensors
Antenna and Reader DomainAntenna and
Reader Domain
WebSphere Embedded Software
w/ IBM RFID enablement
RFIDController
Edge DomainEdge Domain Premises DomainPremises Domain
DB2
RFID Premises
Server
XML overMQ
WAS J2EE platform MQ Messaging IBM RFID Software
Systems Management DomainSystems Management Domain
Enterprise & BusinessApplication Domain
Enterprise & BusinessApplication Domain
XML, other over MQ
Business ProcessIntegration DomainBusiness ProcessIntegration Domain
BusinessEvents
MQ
RFID Integration
Server
WBI Message Broker WBI Integration
Connectors Tivoli Remote
Management
ERPERP
WMSWMS
SCMSCM
PortalServer
EPCInformation
ServicesWPC
EPCInformation
ServicesWPC
Object Directory DomainObject Directory Domain
IBM Application Accelerators
End to End Reliable Messaging Ensures Data Integrity
Persistent Data Flexible Integration
Supply Chain Business Partners
47
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
We advise the execution of integrated and concurrent work streams to accelerate our client’s RFID readiness
Plan & Design
Pilot
Assess
Run
Implement
Feedback
Feedback
Feedback
48
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
To assist in tailoring a client solution, the following business adoption questions need to be reviewed
Managing Trading Partner
Relations
How can I enhance relationships with my suppliers and
vendors?
How do I communicate with my trading partners?
How will RFID impact my business operations with my trading partners?
How can I implement a
reliable – scaleable and
extensible RFID solution that will integrate with my
overall architecture?
What is the most cost-
effective way to ensure that I
achieve required service
levels?
Managing my Business
What benefits can I gain through
greater visibility to my supply chain,
manufacturing process, asset status and/ or
inventory levels?
How do I configure a scalable RFID solution
for world-wide operations?
How will RFID impact my business
operations?
Understanding my Technical Environment
How does RFID interact with my
products, my processes and my
technical environment?
How does RFID interact with my products and
my technical environment?
How will RFID impact my technical
environment?
Assess Plan & Design
Pilot RunImplement
49
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
IBM can also help our clients understand where they fit in the RFID Offering Framework
Managing Trading Partner
Relations
I have mandates being placed on me
by my trading partners
I understand there will be an impact to how I
interact with my trading partners – but I do not
know what it is
I want to gain RFID experience so that I can respond to / or issue a mandate(s)
I have completed successful pilot(s) and am ready to deploy an RFID
solution including associated
process changes and back-end
integration
I have deployed my RFID
solution and now I need to
effectively manage this
solution
Managing my Business
I intend to place mandates on my trading partners
I understand there will be impact to my business environment – but I do
not know what it is
I am considering implementing RFID across my business
Understanding my Technical Environment
I intend to understand how
RFID can enhance my business operations
I understand there will be an impact to my
technical environment – but I do not know what it
is
I need to understand how to define and deploy an architecture for
my RFID implementation
that can scale as I extend the use of
RFID
Assess Plan & Design
Pilot RunImplement
50
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
IBM has a breadth and depth of RFID offerings to help our customers understand and implement RFID solutions based upon business processes and business objectives.
Plan & Design
Pilot
Assess RunImplement
RFID Total Management Services
Maintenance
Software Help Desk
Remote Systems Monitoring
On Site Services
RFID Enterprise Deployment
Trading Partner implementation
Initial facility implementation
Application Design and Implementation
RFID hardware installation
Security tools deployment
Network integration and implementation
Process Transformation
Training
Application planning, testing, integration and Implementation
Business Case Assessment
RFID Test Center QuickStart Services
Solution Development Workshop
RFID Execution Roadmap
RFID Site Survey RFID Capabilities Lab review RFID Technical Solution Design
Incl. Software Domain Mapping & Trading Partners
RFID Partner Selection Business Process Transformation
RFID PilotDefine/ Validate Pilot RequirementsBuild PilotTest PilotPilot Oversight & Performance Results
Our IBM team will work with the customer to understand their needs and tailor a solution from a set of the offerings we can provide
Security & Privacy Services
51
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Achieving the Vision
Assess Plan & Design
Pilot RunImplement
Business Consulting Business case and deployment strategy development; pilot planning and implementation;
process design; application implementation/integration
Technology Services Technology network and infrastructure design,
deployment and maintenance
Software and ResearchOpen and scalable RFID infrastructure, data integration and
management tools
Alliances with Hardware and Software Application Providers
Strategic OutsourcingManagement, hosting and outsourcing of RFID Solution
52
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Industry-Focused RFID Initiatives
As a partner for leading industry players: Business strategy
Pilot design, delivery & management
Technology and business application integration
On-demand infrastructure, software and services
Specific examples:Consumer Products / Retail
- Dedicated teams since 2002- IBM Auto-ID Business Case White Paper Series- Worked with GCI to develop a Retail/CPG EPC Adoption Roadmap- An end-end order-fulfillment RFID implementation accelerator, Pick Pack Ship, built by the SWG Distribution Sector Solutions team
Automotive, Electronics, Forest & Paper, Aerospace- Automobile Tire tagging and Tire-Vehicle correlation using RFID technology- Launched competencies in RFID 2004
Pharma White Papers Streamlining pharmaceutical manufacturing and distribution Thwarting counterfeiting
Public Sector- US Department of Defense recently awarded IBM BCS the contract to oversee their RFID initiative Program Management Office (PMO)
53
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Contents
What is Radio Frequency Identification (RFID)? What is the market opportunity for RFID? What is IBM’s play in the RFID space? What are the IBM Market Spaces for RFID? Why IBM?
54
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
RFID across industry sectors
Industrial
Field Service
Healthcare
Retail/CPG
Logistics
RFID Across All Sectors
Government
55
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Retail
Lower labour costs
Out-of-stock triggers
Reducing shrinkage
Reducing inventories
Locating products
Real-time supply/demand data
Smart shelves
Self check-out
Reverse logistics
Customer convenience Healthcare/ Pharma
Tracking hospital equipment
Patient ID and tracking
Preventing medication errors
Tracking samples/ vials etc
Environmental monitoring (e.g. blood samples)
Anti-counterfeit measures
Product recalls
Manufacturing- Quality control- Lot Tracking- Recalls- Government regulations- Inventory accuracy and visibility- Labour & material costs- Asset utilization- Contract manufacturing- Supplier Management- Customer relations- Supply chain management- WMS- Inventory- Gray markets/ theft- Shrinkage- Shop floor execution
Government- Homeland security- Military/ defense asset tracking
Transportation & Logistics- Asset utilization and tracking- Volume planning- Automated sorting- Automated data capture- Shipment route tracing- Delivery reliability/ efficiency- Contract pricing verification- Reduced claim costs
Construction- Asset utilisation and tracking- Automated data capture- Yard control- Safety equipment tracking
Other- Farm animal tracking- Contactless payment systems- Sensor/ sensing applications- Theme park applications- Airport tracking of baggage/
passengers
Examples of RFID applications in all industries
56
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
The RFID solution cluster is defined by five market spaces
Supply ChainManagement
Leverage RFID technologies to transform supply chains by providing end-to-end visibility of goods and enabling improved inventory management.
Includes: Supply Chain Mgmt using RFID for Warehousing, pallet/goods tracking, Inventory Tracking, Track & Trace, Sensor/ sensing applications. Also covers RFID impact of counterfeiting and fraud.
Work In Process Manufacturing
Apply RFID technologies to the in process manufacturing processes to enable effective inventory tracking and management, product line efficiencies, and JIT manufacturing advantages.
Includes: Automation of assembly, Component production, Production of vehicles.
Asset Management
Companies have physical assets (plants, truck fleets, PCs etc) that are needed to make, and to deliver products and services to customers - knowing where an item/ vehicle is on route, and also tracking of depreciating good – tools, HW, equipment, leased items. Includes: Equipment tracking, Fleet management, Vehicle maintenance management, Track & Trace, Military and defense tracking.
Security & Access Control
Monitor the movement and use of valuable equipment and personal resources.
Includes: Access control and tracking, Animal tracking, Automobile ignition security, Baggage handling systems, Inventory control, Parking lot security and access, Shoplifting prevention, electronic article surveillance, Vehicle security, Sensor/ sensing applications.
Consumer Applications
Monitoring peoples movements, personal security, convenience and Point of sale applications.
Includes: Personal identification and authentication, personal security and safety, Patient ID and tracking, Maintaining shelf stock, Innovative payments, Return management, Purchase maintenance..
57
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Each market space addresses specific customer needs
Supply Chain Management
Lower labor costs by automating data collection and data transfer Reduce errors in mis-shipments, lost inventory and redundant data reads Reduce theft and shrinkage Drive government compliance through regulation Utilize remote product maintenance, warranty and recall alerts
Work In Process
Manufacturing
Minimizes re-work – insures accuracy of manufacturing, Production Line Efficiencies - expedites locating and retrieving the correct part, facilitates the
staging of products and reduces manual processes Lowers manufacturing costs – alleviating labor intensive processes e.g. manual barcode
reads Helps eliminate recalls – automation of part integration tracking Less Line Stoppage - continuous inventory of parts in passage
Asset Management
Provide rapid identification of company assets Ensure secure tracking through the point of transfer Reduce theft and shrinkage
Security & Access Control
Ensure secure, convenient access to personal, confidential informationProvide a mobile, dynamic data repository that can be updatedReduce theft, decrease fraud and mitigate riskImprove users “peace of mind”
Consumer Applications
Improve individual safetyEnsure secure, convenient access to personal transaction data Increase users’ convenience in accessing goods and servicesDecrease fraud and mitigate risk
58
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
There has also been an increased focus on Traceability which affects 4 of the 5 segments
Supply ChainManagement
Traceability is about tracing life cycles of individual products (sometimes people) starting from their resources, materials, parts, subassemblies through final products ending up with consumer use and recycle processes for the purpose of•Individual Quality Assessment, Individual Response/Action of business processes, Individual Environmental Impact Analysis, Individual Risk Analysis, individual Customer Services, Individual Recycling, Granular Optimization of Resources, etc
RFID technology is expected to play a major role in Traceability applications because we can write/carry/read IDs, attributes and generated data of objects in motion by embedding.
Work In Process Manufacturing
Asset Management
Security & Access Control
Consumer Applications
Traceability TraceabilityApplications
RFIDApplications
59
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Sample Customer Experiences (more detail in separate reference ppt)
Track and manage grocery store inventory from the distribution centre to and within the retail store environment. IBM have provided business consulting, middleware, implementation, hardware and support
BP enlisted the help of IBM Global Services - Integrated Technology Services’ Wireless Consulting for this project. In this year-long technical consulting contract, IBM is providing subject matter expertise in RFID physics and sensory technologies. Business benefits for BP will likely come from a reduction in chargeback and shipping errors.
The Fishkill plant needs to use thousands of different active containers for different functions that are transferred from storage area, process tools and manufacturing facilities - all of which are very valuable. Every container has an integrated passive RFID tag with a unique ID (common across all IBM sites) - know where its been, where its going and its history. Every container has an integrated passive RFID tag with a unique ID (common across all IBM sites) - know where its been, where its going and its history
The project provides near real-time inventory visibility to the Philips Semiconductors business units. IBM provided an end-to-end solution with RFID Middleware and consulting and integration services.
At the Burlington facility, RFID tags affixed to the container-level and item-level for tracking the movement of and location of hazardous materials containers helps ensure IBM production exceeds environmental and regulation safety standards.
A Large Paper Company
Our client needed differentiation in a commodity market to elevate vendor switching costs, increase market share and provide a competitive advantage. The client solution will use RFID for product tracking and portal technology for inventory visibility throughout the supply chain. IBM Consulting and SWG involvement.
A Major US Car Rental Company
Rental cars are equipped with RFID tags that ensure vehicle location and movement are identifiable at all times while on the rental lot and when entering/leaving.
APC needed to prepare for the implementation of RFID because of requirements identified by some of its customers such as Wal*Mart and the DoD. IBM helped designed and install a Phase I Pilot at APC’s manufacturing facility in Rhode Island. The solution included business consulting, hardware, middleware and implementation.
SGM (Shanghai GM) SGM hope to improve inventory and supply chain management of field material. Now field workers need check it in some locations periodically (many times a day) and send materials to product line. Sometimes product line has to wait for materials because material requirement is not found timely.
60
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
What does IBM stand for?
IBM implements RFID strategies with customers and in its own locations
IBM addresses compliance whilst moving customers through optimization to transformation
Offers a phased approach to RFID implementations
Ability to connect to multiple business applications (incl. ERP, WMS, legacy)
Change management, process design and business case a focus
Proven capability in complex systems integration, standard based
IBM Research Developed and patented RFID technology Highest number of patents each year for
last 10 years IBM’s Gaithersburg, Tokyo and La Gaude
testing facilities provides on-site advisory services to design technology solutions in the context of your business needs
Experience
Implemented RFID & wireless solutions in many industries
Deep vertical integration and expertise Dedicated industry teams
Vertical Integration
IBM positioned to provide all the necessary infrastructure required to implement a RFID solution: Hardware Wireless software/middleware Device operation management, deployment
and support Secure and scalable solutions
Global coverage & Global financing Partnering capabilities across value chain
IBM has RFID partnerships with over 25 leading technology players including producers of readers, tags and chips, software and storage solutions
Full Equation
61
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Source: RFID Journal.Source: RFID Journal.
Market trigger: Wal-Mart expands RFID mandate to include all suppliers by 2006
In June, Wal-Mart required its top 100 suppliers to have products on pallets employing RFID chips and in cases with RFID chips beginning in January 2005
Pilot ramp-up in 2004 – starting with ~20 suppliers in Jan. ’04.
Regional implementation roll-out – start with Texas region ( 3 DCs, ~150 stores)
By January ’05 - ALL products flowing through Texas region for Top 100+
DSD and DC, all impacted formats, including SAMS Club
Wal-Mart has indicated it would start deploying Electronic Product Code (EPC) technology in the United States and then quickly move to implement it in Europe, then the rest of the world.
In August, Wal-Mart announced it would require all suppliers to implement RFID systems by 2006
NB Do not use this or any other chart discussing WMT. W
e will
advise when it is appropriate to mention WMT, but until th
en IBM
must not discuss any plans that WMT has for RFID – public or
otherwise
62
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Source: RFID Journal.Source: RFID Journal.
Market trigger: U.S. DoD will require suppliers to use active and passive RFID technology by 2005
DOD memo: “The DOD will be an early adopter of innovative RFID technology that leverages the Electronic Product Code (EPC) and compatible tags. Our policy will require suppliers to put passive RFID tags on lowest possible service part/case/pallet packing by January 2005. We also plan to require RFID tags on key high-value items”
The new policy expands active RFID tracking of all:sustainment cargo
unit movement cargo
ammunition shipments
pre-positioned materials and supplies.
63
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Market trigger: Tesco RFID announcement: IGD Retail Logistics Summit (London) – 6/11/03
Philip Clarke (Main Board Director; IT, Logistics & International Businesses) announced the following:
"We will have RFID infrastructure in all UK stores by this time next year”. (approximately 1,000 locations)
Selected suppliers (by size and category) will be required to send Radio Barcode Tagged pallets and cases to Tesco starting September 2004
1 Quarter ahead of Wal*Mart Tesco will give suppliers 6 months notice (i.e. April 2004 for first wave) A series of trials and launches through Q1-3 2004 will precede Phase 1.
All suppliers will have to ship tagged pallet and cases by the end of 2006
“Suppliers should start R&D efforts now”
Tesco will continue to trial item level tagging in 2004
“We firmly believe suppliers will have four-wall benefits through using this technology”.
Visit the website @ tesco.com/radio barcodes
64
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Source: RFID Journal.Source: RFID Journal.
Market trigger: Metro Store Announcement: NRF, Jan 04
The project at Metro highlights the accelerating deployment of radio-frequency-identification technology in the retail industry.
Metro's RFID rollout, planned for November 2004, is expected to reach 250 stores and 10 central Metro warehouses in Germany within the first year and involve 100 of its biggest suppliers, representing 65% of its sales in Germany.
Metro expects to equip all of its roughly 800 stores in Germany with the system by the end of 2007.
The Metro rollout follows a pilot RFID project at one of its supermarkets in Rheinberg, Germany, begun last year.
65
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Market trigger: Target, 20 February 2004
BREAKING NEWS: In a letter from CIO Paul Singer, the 4th largest retailer announced plans to require all suppliers to use RFID across all product by Spring 2007
“Top Suppliers” required to tag all pallets and cases, shipped to select regional DC’s by late Spring 2005.
Goal is for all suppliers to be using tags by Spring 2007
Top Suppliers not defined publicly – probably similar to Wal-Mart’s top 100
No indication yet if the mandate include only stores operated under the Target banner
Suppliers required to use UHF tags based on the EPC Class 0 and Class 1 protocols. The company expects to move to EPC Class 1 Gen 2 when tags and readers based on this specification become widely available
Target Messages:Very much taking a learning approach. Already in pilot with a few key suppliers, and intent is to share
learnings with suppliers later in 2004
RFID views as a complement to barcode and EDI technologies, and Target is supporting a migration approach. Current carton marking requirements for shipping containers will remain unchanged.
Target recognize and supports the efficiencies of common technology standards for RFID for both retailers and vendors.
66
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Market trigger: Albertsons, 5 March 2004
In another significant boost for RFID deployment in the United States, Albertsons, the nation’s second largest food and drug retailer, has launched its first RFID pilot and announced that it will require its top 100 suppliers to tag palettes and cartons by April 2005. The pilot, which the retailer is carrying out with select partners, involves the tagging of pallets and cases of products.
Albertsons says that it expects its top 100 suppliers to tagging their shipments to the company at the case and pallet level. Albertsons’ deadline, however, is not until April 2005, three months after Wal-Mart’s January deadline.
According to Bob Dunst, executive vice president and chief technology officer at Albertsons, the company believes its RFID deployment will improve what it calls its consumer demand chain management by enabling the company to instantly locate products as they flow through its supply chain.
Although Albertsons would not provide much detail about its plans going forward, the company said the announcement about its pilot and deadline was a way to signal to its suppliers and customers that RFID is part of its future strategy.
The company gave few details about its RFID pilot other than that it covers just one of its many project categories and that it expects it to be expanded to other categories as the trial continues. Details of the pilot and the companies involved could be made available later in the second quarter, according to a company spokesperson. The company also said it expects to hold a briefing for the suppliers its expects to meet its tagging deadline.
67
Pervasive / Wireless e-business
Emerging Markets – Pervasive/ Wireless EBO © 2004 IBM CorporationRevision: December 17, 2004
Faye HollandIBM WW RFID Solution LeaderPervasive / Wireless e-business EBOHome office: (44) 1638 742335Mobile: (44) 7740 740839Email: [email protected] ID: Faye Holland/UK/IBMMail point: 31NA – Bedfont Lakes, MiddlesexUNITED KINGDOM
Questions & Answers