After Compliance, Tapping RFID for Upstream Process Renovation

Using RFID to gain competitive advantage at the heart of the true value creation activity


Accurate Product History Tracking
One of the important objectives of any manufacturer is to minimize product recalls by consistently delivering quality product. But during the undesirable event of a recall, manufacturers want to quickly pinpoint the cause and minimize effects of the recall. Generally the details of the materials and sub-assemblies going into finished products, like the supplier name, material specs, operation details, completion times, etc. are not accurately recorded. This can cause double handling, higher scrap rates, unnecessary cycle counting and an overall drop in productivity.

RFID technology, with its natural tracking and tracing capabilities can help the manufacturer record quality compliance at each step of the process. Expensive materials and sub-assemblies can be wasted if out-of-spec materials or wrong processes are used. RFID can provide timely and accurate information to enable bill of material (BOM) compliance and to quickly identify root causes of quality defects.

Enterprise Asset Tracking and Control
Tracking both fixed assets and mobile assets in an enterprise facilitates capital expenditure decisions, provides visibility to the condition of assets and prevents misuse. Formulating tight policies and procedures for tracking ensures assets are being used in designated places to achieve the desired results. Typically when it comes to mobile/reusable assets like laptops, expensive tools and other accessories, theft is a common occurrence, and interplant material movement of assets like pallets, racks and totes are often not managed properly and become dilapidated. Large manufacturing operations spend a significant amount of planned labor allocation in hunting for the right resources to keep production lines running. Lack in equality of focus and attention in tracking reusable assets vs. assets like finished goods and raw materials can have the potential to shut the whole operation down.

The standard track-and-trace application of RFID can provide valuable ongoing information about the location and condition of both fixed and mobile assets. This prevents theft, misuse, prolongs the life of assets and facilitates write offs at the appropriate times.

Summary

Limiting the use of RFID to just comply with customer mandates is not realizing its full potential. Developing agility, especially in manufacturing, is a survival requirement in today's competitive global market place. By smartly leveraging the track-and-trace capability, the effects of random process variability across supply chains can be minimized. RFID enables meaningful process automation and provides real-time event information, and that can be a powerful combination for businesses to deliver superior value to their customers at a lower cost.

References

Collin Mason, David Caruso, Roddy Martin, AMR Research, April 2004, Next Generation Manufacturing: Integrating Manufacturing into DDSN.

Manish Bhuptani, Shahram Moradpour, 2005, RFID Field Guide, Deploying Radio Frequency Identification Systems. Sun Microsystems Press, and Prentice Hall

Greg Aimi, AMR Research, August 2004. Reusable Mobile Assets: An RFID project waiting to happen.

John Fontanalla, Matt Bilodeau, AMR Research, October 2003. Finding ROI in RFID.

About the Author: Subramanyam Venkataraman is a senior consultant in the Supply Chain Management domain at Infosys, an end-to-end business solutions provider.

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