Supply Chain Brain

driver missing a scheduled pickup.

New variants on wireless are catching on in the truck cab. Global positioning systems monitor the location of tractor and trailer, while cellular technology allows drivers to scan packages, confirm deliveries, accept orders and returns, and generate invoices while out on the road. Such capabilities are built into RedPrairie’s transportation management system, Kozensky says.

Supplementing local area networking (LAN) standards is the growing use of voice-over-internet protocol (VoIP). The technology has experienced some “fits and starts,” Kozensky says, but is finding use among major producers such as Coca-Cola, which is employing it in inventory picking. Wider market acceptance has yet to occur, with the burden on vendors to demonstrate that the system can consistently support high-volume operations.

Dropped signals remain a problem within cellular networks, although the newest systems provide backup capability so that no data is lost during temporary breaks in connection. “When a device goes away and reappears,” says Kozensky, “you can pick up right where it left off.”

Wireless has come a long way from its initial deployment on the warehouse floor, says Warren Sumner, general manager of the enterprise products group of TAKE Supply Chain (formerly ClearOrbit) in Austin. Mobile computers are finding new uses in delivery trucks and throughout the chain. Today’s devices offer color graphics and a deeper level of intelligence about inventory positions.

“A lot of companies are talking to us about how they can track inventory once it leaves the warehouse,” Sumner says. The goal is to reduce the amount of buffer stock that arises from uncertainty about customer demand.

GPS technology offers “geofencing” capabilities for truckers, allowing fleet managers immediately to see when a vehicle has strayed beyond its acceptable position, or is being driven in an unsafe manner. In the process, Sumner says, companies gain a level of intelligence that can result in lower insurance rates. GPS combines with barcodes and RFID to provide a complete picture of the shipment, from the precise location of the truck to the delivery of its contents.

Tag cost continues to impede the progress of RFID, Sumner says. The technology can be justified in many high-vol-

ume operations, where it leads to labor savings. But for the scanning of individual items at low volumes, the use of RFID by drivers “doesn’t make sense,” he says.

Wireless can play a major role in stopping the illegal diversion of product. Smart devices, tracking an item’s journey to the end customer, help producers to enforce distribution policies in cases where gray-

“It’s developing at
light speed. In my
view, wireless is the
way the world is
going.”

— Neil Smith of Savi Networks

market sales are a possibility, Sumner says. The pharmaceutical industry is especially vulnerable to such practices.

A Maturing Technology

Basic radio frequency (RF) technology continues to be the most popular flavor of wireless in the distribution center, says Brent Forden, senior product manager for supply chain management with Alpharetta, Ga.-based Infor. “A close second, and coming up fast, is voice,” he says, adding that Infor has a large number of customers who are using the technology in place of RF.

In terms of development, voice is now at the stage that RF was 10 years ago, Forden says. New technologies tend to start up with proprietary hardware and software, then migrate toward industry standards supported by all vendors. “Right now,” he says, “voice is in the proprietary area. A few people are working on solutions that can make use of multiple technologies.” He sees signs of a convergence, whereby existing RF devices become voice-enabled instead of being scrapped for the next big thing in wireless.

Beyond that, Forden has witnessed early experimentation with an enhanced system for visual recognition of barcodes. An onboard computer would be constantly scanning its environment, picking up location data and product barcodes. It would

pinpoint the position of equipment much like a GPS system. “So far, the price points look kind of high,” he says. “I’m curious to see how it will go forward.”

As for RFID, it isn’t sufficiently mature for large-scale deployment on cases and individual items, Forden says. But a number of companies are finding success in the use of RFID for tagging pallets, some of which have embedded chips. “It’s come through the hype cycle,” he says of RFID. “A lot more people understand what it is, where it’s applicable, where you can and can’t get a return on investment in the supply chain distribution environment.”

John Seaner, vice president and general manager with EPCglobal US in Lawrenceville, N.J., says RFID holds promise in three major areas: manufacturing, distribution and retail. In the first instance, factories can keep tabs on such assets as tools, bins and reusable containers, which are essential to the smooth operation of any plant. On the logistics and distribution side, both transportation assets and freight are being tracked via RFID, although Seaner says the technology tends to be deployed in this area “in very limited fashion ... for particular retailers and clients.” In the retail sector, RFID can potentially help companies to create a closed-loop supply chain which ensures that supply is coordinated with demand, and lost or stolen merchandise is minimized.

The next step, Seaner says, is to make critical data available to one’s trading partners. EPCglobal US is playing a key role in developing industry standards and transaction sets which will allow for the easy exchange of information generated by RFID chips. Seaner predicts that a common infrastructure will be widely accepted within two to three years.

Mike Markham, vice president of sales with Cadre Technologies, in Denver, agrees that wireless is currently strongest on the warehouse floor. Wireless networks are easy to set up within the facility, through the use of standard routers linked to a server. The technology is an especially valuable means of boosting productivity in picking, he says. Aided by the new generation of handheld devices, a warehouse manager can direct the workforce from a central location. “Probably 95 percent of the businesses we work with today are interested in that technology,” says Markham.