Tag, you're it: Defense pushes RFID to vendors
A Defense Logistics Agency worker pulls stock from racks at the Defense Distribution Depot at Susquehanna, Pa., DOD's largest distribution center.
By January 2005, the 23,000 vendors selling goods to the Defense Department must begin to put radio-frequency identification tags on the smallest practical unit of packaging.
DOD wants to do more accurate tracking of the 4.6 million items needed by military personnel and systems at home and in the field. The undersecretary for acquisition, technology and logistics set the deadline last fall, but just what it will require of suppliers still is being worked out.
'Our policy is evolving,' said Ed Coyle, chief of the DOD Logistics Automatic Identification Technology Office. 'Our goal is eventually to get to the individual item level. We don't expect to be there in January 2005.'
The policy will have significant impact in the private sector. Advances in passive RFID tags have made their use practical for individual items'a revolution in inventory and supply systems.
DOD is collaborating with Wal-Mart Stores Inc., which will require its top 100 suppliers to use passive RFID on pallets and cases by January 2005.
'It is not just in DOD's and Wal-Mart's interests but for the wider community as well,' Wal-Mart spokeswoman Sarah Clark said. The economy 'will benefit from the lessons learned and from lower-cost tags and readers under common standards,' she said.
RFID so far has been used primarily in industry-specific applications, said Scott Medford, vice president of global business development for Intermec Technologies Corp. of Richardson, Texas.
Moving RFID into the supply chain 'takes the market from hundreds of thousands of dollars a year to billions,' Medford said.Privacy concerns
Privacy advocates, however, argue that wide use of the tiny tags on consumer goods could expose everyone to electronic tracking.
'We have to be cautious,' Coyle said. 'Implementation of RFID is a watershed event with the potential to reach into our lives in every way.'
DOD for the last decade has been using active RFID tags, which carry their own power supply, for internal distribution. They came into use after much of the materiel destined for troops during the first Gulf War stalled at depots and never reached the field.
The abandoned supplies 'looked like the Korean War and like pictures I've seen of Havana during the Spanish-American War,' Coyle said.
By placing the tags on shipping containers and large pallets, the Defense Logistics Agency began tracking goods shipped through its facilities and locating the goods at the destination. It became a leader in the use of RFID to track inventory.
'We are much better than we were but not as good as we should be,' Coyle said.
Pushing the system back to the original supplier and down to the individual item has had to wait for the technology to mature. DOD's active tags from Savi Technology Inc. of Mountain View, Calif., are reusable and can be read from about 300 feet. But they require their own batteries and cost about $100 each, so use is limited to large items such as shipping containers.
With the advent of passive tags that cost a dollar or less and use power generated by the reader's RF signal, 'the applications can get broader,' Coyle said.
The amount of data a passive tag stores'about 2K'is smaller than on an active tag. Its range also is shorter. It can be read from about 20 feet by a stationary reader and from five or six feet by a handheld device.Two types of tags
'We think the time is right to move out,' Coyle said. 'Our senior leadership has said, 'You will do this.' '
DOD policy calls for continued use of the existing active tags while adding passive ones. The readers will integrate with the military's existing tracking systems, and RFID events will be transactions of record.
The cheaper passive tags will go wherever they make sense, Coyle said: 'We're not going to put a 40-cent tag on a 25-cent package of gum. But a $1 tag on a pallet of meals-ready-to-eat makes sense.'
DOD held its first one-day vendor conference on RFID last year. Pilots using passive tags launched last month, and a second vendor summit will take place this month. A final policy incorporating the results of pilots, and the vendor summit is due by July.
The military's expenses for implementing RFID will become part of the normal cost of transportation and logistics, funded through routine operations or working capital funds. DOD will provide the necessary equipment for vendors to meet its requirements.
Among the issues still to be worked out is the tags' technical specification and the data they will carry. EPCglobal Inc. of Lawrenceville, N.J., is developing uniform Electronic Product Code standards for them.
'We need to get to one globally accepted standard protocol for reader-to-tag communications,' Wal-Mart's Clark said. The company plans to buy readers that are software-upgradeable as standards develop.
DOD wants to take advantage of Wal-Mart's experience with passive RFID, because 'a lesson learned is a lesson learned,' Coyle said. Each organization can benefit from the other's experience, and technology suppliers can benefit from both.
'I have a Wal-Mart person on our working group as a co-chair,' Coyle said. 'The last thing we want is to establish separate patterns. There are more places where we are similar than where we are different.'