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Electronic Product Code (EPC): A Key to RFID

Written By: Predrag Jakovljevic
Published On: August 2 2004

Introduction

In simple terms, the electronic product code (EPC) is a unique number that identifies a specific item in the supply chain by linking serial numbers to the product information stored in a central database, and which is stored on a radio frequency identification (RFID) tag. Once it is retrieved from the tag, it can be associated with dynamic data such as where an item originated or the date of its production. Users of EPC codes will have to purchase the numbers from EPCglobal (www.epcglobalinc.org), the organization behind the evolving RFID standards, and which assigns these numbers to identify the manufacturer, product, and serial number.

EPCglobal , (the former Auto-ID Center) is a not-for-profit research organization headquartered at Massachusetts Institute of Technology (MIT), and is designing the critical elements and creating global standards for the next generation bar code—called the EPC Network, also has causal partnerships with MIT and several leading retailers.

The technology system in development at EPCglobal could help businesses save billions of dollars in lost, stolen or wasted products. For example, EPC tags affixed to packaging could provide manufacturers, distributors, and retailers with the following benefits:

  • Product authenticity—allows distributors and retailers to confirm, with pinpoint accuracy, whether or not the goods on their shelves are authentic, since users should have instant access to information indicating precisely when, where and by whom a product was made.

  • Product availability—gives manufacturers a true "produce-to-demand" capability and will be able to eliminate excess inventory by drawing on the latest data.

  • Greater efficiencies—combines "produce-to-demand" capability, plus inventory reduction and balance plus reduction in manual stock keeping, the supply chain could recognize cost efficiencies in the range of hundreds of billions of dollars.

  • Enhanced recycling—codes a package as cardboard, aluminum or plastic, may allow the technology to greatly amplify and simplify and improve waste management and recycling efforts.

Data in a distribution center (DC), once within range of a reader, will be supposedly captured, accepted and then executed against by a supply chain execution (SCE) solution like a warehouse management system (WMS) or a transportation management system (TMS) application suite. With RFID/WMS/TMS integration, it could be possible to have totally automated logistics tracking processes, enabling products to pass through the DC without manual checking and scanning. For example, when an incoming shipment is physically moved into the four walls of the DC, the facility's antennae should capture information from the embedded RFID tags. These antennae then pass the data onto the WMS application, which accepts the information and automatically receives the inventory, thereby eliminating the manual receiving processes of counting and scanning individual items, cartons or pallets.

Real Time Inventory Control

Real time inventory control, tracking and alerting capabilities would be other very important advantages of RFID. As tagged inventory goes through ports and terminals, freight forwarders and the into a DC, the RFID tag provides real time visibility of an item's whereabouts at all times. With RFID, WMS and TMS suites will be able to track and maintain inventory with minimal supervision in an entire network of DCs in a fraction of the time currently required.

To that end, the EPCglobal mission is to create standards and assemble building blocks for the "Internet of Things" whereby all supply chain transactions will be logged and made available to the authorized recipients over the Internet. How would the EPC Network operate? An RFID reader would scan product (unit/case/pallet), and then an EPC Savant server would decode the EPCs, so that an object name server (ONS) would look up the product information address later on; ONS becomes equivalent to an Internet domain name server (DNS), an Internet service that translates more intuitive alphanumeric domain names into mere numerical Internet Protocol (IP) addresses. Thereafter, a physical markup language (PML) server would return specific product information to the enterprise application (ERP, WMS, etc.). Again back to analogy, PML would be equivalent to a web site, describing the physical characteristics of the product.

As already discussed in SCP and SCE Need to Collaborate for Better Fulfillment, in addition to these demanding functional capabilities of supply chain management (SCM) applications, seamless integration of transactional and decision-support applications has become quite important, and, consequently, modern SCE systems provide the tactical, transactional backbone for order fulfillment and visibility atop their core functionality of order management, warehousing, transportation, yard and inventory management. To be able to react to fluctuating demand, respond to customer specifications, and coordinate real time event messages from multiple disparate systems, these systems are being further enhanced with decision support capabilities and planning engines aimed at order fulfillment and inventory and order status visibility.

Testing the RFID Solution

Sun Microsystems, one of many RFID evangelists, has a new up to date RFID Test Center in Dallas, Texas (US) aimed at bringing together a near complete RFID solution designed to help quell the fears of companies looking to initiate an RFID compliance program and relatively quickly help them achieve compliance status. Sun's RFID Test Center, a 17,000-square-foot warehouse facility, was opened in May, and is fully equipped to meet the EPC standards and RFID compliance requirements for tagging and testing of products at the pallet and case level.

Although corporations and government agencies around the world recognize RFID's potential to cut supply chain costs, increase operational efficiencies, speed delivery time, minimize theft and waste and so on (e.g., warehousing and distribution units should benefit from increased shipping accuracy, labor savings, inventory accuracy, and reduced inventory shrinkage; retailers should benefit from reduced inventory shrinkage and reduced out of stocks on shelf; while the entire supply chain should benefit from automated lot, expiration and serial tracking and no need to re-label at every step), the idea of RFID implementation can logically seem insurmountable at this stage of the general users' education (see RFID--A New Technology Set to Explode?).

This is possibly the first RFID test center of its kind —a working warehouse where companies can test how the entire system works before they invest in RFID technology. Companies can use the test center to evaluate how they can incorporate RFID into their manufacturing, warehouse and distribution environments, develop production of a full scale product tagging plan and come away with an appropriate system architecture for the implementation at their site.

Along with showcasing a state-of-the-art warehouse environment equipped with RFID readers installed at dock doors and warehouse forklift portals, the test center contains material handling pallet conveyers and high speed conveyor station products for advanced tagging and testing of RFID tagged products. Integration with Provia's warehouse management system will allow for automated processing of advance ship notifications (ASNs). The initial use for the test center will be for pallet acceptance into the center via dock doors, but will quickly be expanded to the tracking of products to various test stations such as pallet conveyors, high speed tracks, and pallet racks.

Conclusion

Many middleware vendors have been developing products that filter data from RFID readers. Most of the products are based on the above mentioned Savant's, distributed software created by EPCglobal to provide smooth data and to find information related to EPCs. As said earlier, the users will also have to purchase EPC numbers from EPCGlobal, the organization behind the evolving RFID standards, and which assigns these numbers to identify the manufacturer, product, and serial number.

The real benefits of RFID will be achieved, when the integration of the EPC data will be a substantial part for the control of supply chain business processes. To that end, a broad enterprise solution from the likes of SAP too could be applied in warehousing, manufacturing, and transportation, and at touch points between these (e.g., production line replenishment of the warehouse, cross-dock from receiving to production line, shipment verification in warehouse to manifesting, control of yard movements, and then in-transit visibility up to a final proof of delivery in transportation).

One of the main obstacles is the lack of integration, since there is a dearth of software tools from enterprise application integration vendors to get data from RFID tags and readers into existing business systems, meaning that companies are often forced to do expensive custom integration work. Together with vendors, they will have to devise ways to filter out false or redundant reads and only pass useful information to enterprise applications. Managers will have to devise policies on how much data to collect from RFID systems, which signals to record, which to ignore and which to forward to a transactional system or a person for an action. Such policies could eventually be coded into business logic of SCE applications or some type of a business-rules engine, and then enforced by middleware.

 
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