An Introduction To RFID In The Supply Chain

Transcription

1 An Introduction To RFID In The Supply Chain

2 Table of Contents INTRODUCTION... 3 HISTORY... 5 THE EPC NETWORK... 6 RFID HARDWARE: READERS AND TAGS... 6 RFID Tags... 6 RFID Frequencies... 7 RFID Air-Interface Protocols... 8 What is the class of a tag?... 8 Can the GTIN number be extracted from EPC tags?... 9 Where does the EPC get written?... 9 What is Version 2?... 9 Are there other standards?... 9 RFID Readers and Sensors Agile Readers Reader Antennas Other Sensing Devices MIDDLEWARE AND VISIBILITY INFRASTRUCTURE Data Management Edge Visibility Enterprise Visibility System Management Security Configuration Device Management EPC NETWORK AND APPLICATION INTEGRATION Middleware Access Standards EPC Network Infrastructure Services Existing Applications MARC GLOBAL AND OATSYSTEMS MARC RFID CUSTOMER COMPLIANCE KIT MARC RFID ENTERPRISE EDITION OATSYSTEMS EPC-IS EDGE SERVER SOLUTION The EPC-IS Edge Server Platform VISION ABOUT MARC GLOBAL ABOUT OATSYSTEMS APPENDIX A: Warehousing Efficiencies APPENDIX B: Middleware Is The Key To RFID

3 INTRODUCTION The RFID revolution has arrived and it is enabling the high-resolution supply chain of the future. A staple of hardware and software standards around RFID created by the Auto-ID Center and EPCglobal, and now expanded and put into practical use by application companies such as MARC Global and RFID infrastructure companies such as OATSystems, has the potential to permanently change the supply-chain, and perhaps, commerce in general. As a brief introduction to this technology, following are the top 10 things an executive must know about RFID (adapted with permission from Top 10 Things CEOs Must Know About RFID, originally appearing in the RFID Journal, April 2004). 1. Widespread adoption of RFID may take years but it is inevitable. RFID has the potential to solve a wide variety of problems including counterfeiting, inventory accuracy, reduced labor costs and complying with track and trace regulations and mandates. Improved efficiencies and the reduction in RFID technology costs, such as RFID tags, will soon make this technology pervasive. If you haven t already, you should begin implementing a path to adoption. 2. RFID is infrastructure that needs to be leveraged across the entire enterprise. Once readers are installed for one function, look for additional ways to leverage their capabilities to cut costs, reduce outages, stop theft, improve customer service, and even help homeland security by blocking misuse of containers. 3. RFID is not a panacea. Do it badly, or along with other underlying problems (i.e. poor warehouse management, having a system whose old architecture can t handle the explosion of RFID data volume, or having a system incapable of tracking at the appropriate unit level) and you ll actually increase the number of short-term problems. To ensure implementation success and achieve the full value, utilize a holistic approach. This may include replacing your execution application systems with new ones that better handle increased volume and tracking levels and provide additional data storage and improved analytics. 4. RFID is just the beginning. You must invest in IT infrastructure capable of using real-time RFID data to make dynamic, real-time decisions across the supply chain. 5. Collaboration is key to achieving many of the benefits of RFID. For example, could you reduce distribution costs by collaborating with other manufactures and by sharing distribution centers if you can track everything with RFID? This could allow you to combine some or all of your shipments in order to get fuller truckloads to retailers. 3

4 6. Success requires cultural change. Be ready to support new paradigms. 7. RFID strategy must be implemented globally. Different regions of the world have different radio frequency use regulations, therefore a tag from Asia may not be readable if you are set up only to read US tags. If a global approach is not taken, the long run implementation of your RFID strategy may be far more costly and less effective than originally planned. 8. There is no formula to calculate the costs and benefits. Just tagging a case won't save you a dime... you also need to adapt your business processes. 9. Privacy is a serious issue. You need to educate consumers if you want to protect your brand integrity... even if you are not yet doing RFID. Working with industry bodies such as EPCglobal can help. It is important to educate consumers about benefits such as improving food safety, reducing counterfeit prescription drugs and improving return and warranty information. 10. The implementation must be assessed periodically. Set progress milestones and measure results. Know up front that this will likely be a 3 to 5 year endeavor. During that time things will change and evolve. Compliance mandates from Wal-Mart, Target and the Department of Defense (DoD) are forcing many companies to assess, select and implement solutions that will make them compliant with their customers RFID requirements. Because understanding the current environment is not enough, MARC Global and OATSystems (OAT) developed this paper to understand how RFID basically works, the various building blocks required, and the potential that the technology has for your supply chain. 4

5 HISTORY The precursor to what is today called Radio Frequency Identification (RFID) technology was developed during World War II to distinguish friendly aircraft from enemy aircraft. During the 60's and 70's, RF transponders began to be used to track military equipment, cattle, and railcars. In the 80's and 90's, it started to become feasible to capture all the circuitry of an RF transponder, with the exception of the antenna, in a single chip. This signaled the arrival of the RFID tag, a small, high performance means of identification that could be placed on an asset. By the middle 90's, RFID tags were quite common in a range of consumer applications such as toll passes, card-keys and gas-pump payment systems. RFID tags cost upwards of US $1.00 around this time, and while they were finding increasing use, there was no established standard or system to facilitate ubiquitous adoption. In 1999, a new center, called the Auto-ID Center, was established at MIT with the specific goal of creating the technologies, standards and systems that would drive widespread adoption of low-cost RFID tags. The Center proposed a system-oriented approach: keep the tags simple and concentrate on range; cost and performance; acquire tag data through a reader into the enterprise; and let software systems store business data and perform the actions necessary to take advantage of the tags. This minimalist approach, referred to as the Electronic Product Code (EPC) approach, was a contrast to the earlier world of highly specialized tags with a significant amount of embedded functionality. It is evident today that the minimalism offers two advantages: first, by reducing functionality to a common baseline, it permits a greater number of applications to share a single standard. Second, by reducing the circuitry on the tags, it enables lower costs, higher ranges and better performance. The standards proposed by the Auto-ID Center gained wide support from end-users of RFID technology, and resulted in the establishment of a new not-for-profit entity called EPCglobal, which will continue the work of the Auto-ID Center. EPCglobal has published a number of hardware and software standards which are expected to drive the new world of standardized, low-cost, ubiquitous RFID. 5

6 THE EPC NETWORK The EPC Network is the ecosystem of technologies that together enable a High Resolution Supply Chain using RFID. The system can be visualized as a series of layers. The lowest layer represents RFID tags. The second layer represents RFID readers and other sensing devices. Together, the first two layers are the hardware portion of the EPC system. The readers and other devices are tied together and orchestrated by the middleware, which is represented as the third layer. The middleware absorbs amorphous data from the hardware and offers actionable information to applications, like warehouse management systems or replenishment systems, which are represented as the fourth layer. Services like the Object Name Service help connect companies that are engaged in commerce. Before we begin describing RFID and the EPC Network, it is necessary to define EPC. EPC is a single number that identifies an object uniquely in the world. Every pallet, every case, and every item, down to that last tube of toothpaste, can have its own unique EPC. Just as a social security number in the US uniquely identifies an individual and enables everything from tax records to medical histories to be conveniently indexed, the EPC is the life-blood of the EPC network. The number itself has many fields that together identify the manufacturer, the product and the unique serial number of the item. The EPC can also be converted into other numbering schemes like the GTIN (Global Trade Item Number) as defined by the EAN and UCC, and certain characteristics like whether the item is a case or a pallet can be pulled out of the EPC code. RFID HARDWARE: READERS AND TAGS The key components of RFID hardware are readers and tags. The language that readers and tags speak with each other is called the RFID protocol or the air-interface protocol. Let us consider tags first. RFID Tags An RFID tag consists of a chip the brain and an antenna. Together, the chip and the antenna reside on a substrate of polymer or paper that could be the label or even the packaging material of the item being tagged. The tags that have been in the news recently are a sub-species called passive tags. Passive tags have no batteries, can be made relatively cheaply, and have good performance. In order to understand where passive tags fit in the larger family of RFID tags, it is necessary to know that there are two basic dimensions along which tags can be classified: energy and signaling. The first dimension is energy or power: tags need an energy source to power the chip. Tags can either scavenge power from the reader, or use a battery as the energy source. The 6

7 second dimension is communication: tags can either actively send signals to the reader, or simply reflect signals from the reader back to the reader, rather like using a mirror to signal a distant observer on a sunny day. The table below summarizes the categories of tags along these two dimensions. Transmission is Reflective Transmission is Active C H I P I S P O W E R E D B Y S C A V E N G I N G Called passive. Range ~ 3m Life ~ infinite Category not defined. Today, this seems a redundant option. C H I P I S P O W E R E D B Y B A T T E R Y Called semi-passive Range ~ 10m Life ~ 5-10yrs Called active Range ~ 100m Life ~ 1-5 yrs RFID Frequencies RFID tags can operate in a range of frequencies from 100 KHz to upwards of 2.5 GHz. However, there are national regulatory limits on what frequencies are available for RFID communication and how much power is available. Nations protect their frequency spectrum and auction it off for everything from cellular telephony to astronomy. Some bands are usually reserved for free use, however, and this is where RFID systems usually operate. These bands are referred to as Industrial-Scientific-Medical (ISM) bands. EPCglobal has defined protocols for the connection between readers and tags in the MHz ISM band (referred to as HF), which is standardized worldwide, and a range of frequencies referred to collectively as UHF. Although the availability of UHF bands is more fragmented across the world, regulations in North America, Europe and Japan are close enough to permit a single UHF tag to work in these major areas. Available UHF bands in major areas around the world are as follows: US: 902 MHz ~ 928 MHz EU: 868 MHz ~ 870 MHz Japan: 950 MHz ~ 956 MHz Many other significant areas like China, India, South Korea and Southeast Asia are also considering UHF band availability. Furthermore, the EPCglobal UHF protocol can also be operated in the 2.45 GHz range, which is another band generally available around the world. Besides differences in frequencies, differences in field strength or power levels also affect how well RFID systems work in different parts of the world. Today, the power levels permitted in the UHF band in Europe limit the range of UHF RFID tags to roughly half that in the US. However, there is a current effort to open up a higher-power band in Europe to address this problem. At MHz, the ranges permitted around the world are roughly the same. OAT s EPC-IS Edge Server optimizes system performance for all frequency regulations. In areas like Europe, where the frequency band is narrower, and where there are special regulations called duty-cycle restrictions, readers will compete for airtime. Under these circumstances, system coordination and optimization is critical. 7

8 A common question is why is it necessary to consider different frequencies at all? Why not just use HF tags, which would be legal around the world? The answer lies in physics. Just as the signal to a cellular phone fades in elevators, RFID tag performance drops when the signal from the reader cannot propagate through obstacles. Different frequencies have different propagation characteristics. HF radiation propagates through moisture, plastics and paper better than UHF radiation. So, if you are tagging bottles of medicine, HF may be a better choice. UHF, however, has better range in free air. So, if you are tagging pallets, which you want to read from a distance, UHF is preferable. This is why the US FDA recommends that individual pharmaceutical items be tagged with HF tags while Wal-Mart has requested its suppliers to tag pallets and cases with UHF tags. RFID Air-Interface Protocols RFID readers and tags communicate with each other to extract the data contained in the tags, and less frequently, to insert data or execute commands in the tags. There are two engineering challenges: first, the response from tags, especially passive tags, is relatively faint whereas the environment can be noisy; second, if there are several tags in the field, it is necessary to schedule the communication so that the reader can communicate with each tag individually and without confusion. These are well understood problems in the field of communications engineering, and there are many ways to solve these problems. In particular, the technique that a protocol uses to sort out multiple tags in the field and schedule responses is referred to as the anti-collision technique, and it is usually the feature that sets protocols apart. Different anti-collision techniques are preferable in different regulatory situations. EPCglobal has defined three airinterface protocols: The Class 0 UHF Protocol works in the UHF band in the US and EU. The Class I UHF Protocol works in the UHF/2.45 GHz bands in the US, EU and Japan. The Class I HF Protocol works in the HF band around the world. EPC-IS Edge Server has been demonstrated with Classes I, II, III and IV tags. For example, an ongoing pilot at the US Department of Defense is using temperature measurement tags to track the temperature and quality of MRE s (meals ready to eat) for war-fighters. What is the class of a tag? The term class in the name of a protocol is a nomenclature adopted by EPCglobal to describe the functionality of an RFID tag. Briefly, Class 0 tags are minimalist tags that carry an EPC number, and are intended to be read-only. Class I tags are tags which can have the EPC number (or some other data) written on to the tag in the field. However, once this number has been entered, the tag is generally locked and then used in read-only mode. Class 0 and Class I tags are also referred to as license-plate tags. Class II tags are tags which can have significant amounts of data written to them. For example, a Class II tag on a pallet might have not only its EPC, but also a shipment manifold. Of course, Class II tags have lower range and generally more expensive. Class III tags are semi-passive tags and offer greater range. Class IV tags are active tags and offer 8

9 the greatest performance, but are also the most expensive and bulky. The Class structure was laid out formally by Sarma and Engels. 1 Can the GTIN number be extracted from EPC tags? GTIN, the Global Trade Identification Number, is the lingua franca of the barcoded retail world. Other numbers like the SSCC (Serial Shipping Container Code) and the GRAI (Global Returnable Asset Indicator) are extremely important in logistics and the supply chain. These numbers can be extracted from the EPC. The extraction is not trivial, and requires network updateable translation tables, but is essential for integration with legacy systems. Where does the EPC get written? Class I and higher class tags can be programmed in the field. Programming a tag requires a number of functions. First, the GTIN must be added to a serial number and translated into an EPC. (SSCC and GRAI are already unique and don t require a new serial number.) Second, care should be taken that different facilities do not use the same EPC. Third, the EPC must be written on the tag, which is likely on an item, a case or a pallet, and information about the object must be recorded against that EPC in a database. Finally, the tag must be tested, the information verified, and, if necessary, test results on the tag must be stored. What is Version 2? There is an on-going effort to develop a new Class I UHF protocol, called Class I Version 2, to replace the old Class 0 and Class I UHF protocols. There are several reasons for this effort: first, regulators around the world are making concessions to the RFID community and opening up new bands, and the new protocol should be able to take maximum advantage of these changes. Second, the RFID community has learned a great deal about the applications in which tags will be used, and the new protocol will be able to handle these emerging requirements. Third, advances in chip manufacturing are likely to make more functions affordable on RFID chips. Finally, Version 2 could trigger reduced prices and increased features for readers and tags, as manufacturers are able to produce to a common standard. The time-line for Version 2 is unclear, but it seems unlikely that production tags will be available before The EPC-IS Edge Server suite includes a sophisticated module called the EPC Commissioning module which can commission EPC s using a distributed architecture and ensure serial number consistency, beginning-of-life data linking, and advanced anti-counterfeit features. EPC-IS Edge Server will be able to update V2-compatible readers when the new protocol is available. This will insulate applications from any changes. Are there other standards? The International Standards Organization (ISO) and other bodies have defined several other RFID standards. In fact there are more than 100 other RFID standards in existence today. That was indeed the problem that an adopter faced in the 1990's. Most of these standards are very specialized for particular applications, like ticketing, or animal tracking, and as a result, do not command the volumes necessary to ensure low prices. By identifying the common 1 Sarma, S. and Engels, D. On the future of RFID tags and protocols, Auto-ID Center, MIT-AUTOID-TR-018. October

10 requirements of a wide range of applications, the Auto-ID Center and EPCglobal have reduced the number of standards to 3 families. RFID Readers and Sensors RFID readers perform two functions. First, they initiate and execute the steps in the air-interface protocol. Second, they provide power to passive and semipassive tags for communication and computation. There are two types of readers on the market today: dedicated readers and agile readers. Dedicated readers tend to be dedicated to a single RFID protocol. Before the Auto-ID Center came into existence, most readers were dedicated readers. Agile Readers The word agile refers to a newer class of readers, and has been used rather loosely. Protocol-agile readers can handle several protocols at the same time. For example, a protocol-agile reader might be able to read Class 0 and Class I tags in the UHF band. Frequency-agile readers can read tags at different frequencies. For example, a frequency-agile reader might be able to read HF and UHF tags (and ideally, 2.45 GHz tags). A third class of readers is firmwareupgradeable readers. The firmware on a reader is the embedded program in the reader. The ability to upgrade the firmware in the reader is essential for two reasons: first, because the firmware itself might have bugs, or might otherwise be improved. Second, because the air-interface protocol might change. Firmware upgradeability is an essential requirement that we recommend because it makes your capital investment future-proof. Reader Antennas The reader reads tags by creating and receiving electromagnetic radiation through its antenna. The antenna is basically the eye through which the reader sees the world. Some readers have multiple antennas, each of which is accessed individually. This permits broader coverage of space with fewer readers. Multiple antennas also permit the reader to stir the field and ensure that the last, recalcitrant tag is read. Other Sensing Devices RFID readers automate sensing and counting of inventory, and are the most prominent fixed infrastructure in an RFID deployment. However, bar-code scanners that are already in existence must be incorporated into any new system until the use of bar codes ceases completely. Furthermore, other sensing devices and actuators are usually necessary to complete the automation of a logistical operation. For example, motion-sensors may be necessary to detect the motion of a pallet as it goes by so that the reader knows that the tag that was read was indeed that of the pallet in front of it (and not a pallet behind it). Furthermore, once the pallet has been read, it may be necessary for the middleware to trigger an arm which sweeps the pallet from the conveyor to a waiting station say because the pallet has been misrouted. Sensors, like motion sensors, and EPC-IS Edge Server supports all major reader hardware, and takes full advantage of the agility of advanced readers. EPC-IS Edge Server has a sophisticated model for activating individual antennas according to different schedules, and for aggregating and interpreting the data in different ways. EPC-IS Edge Server has a number of external devices ranging from motion sensors to displays. EPC-IS Edge Server even supports SNAP, an interface for programmable logic controllers. 10

11 actuators, like programmable logic controllers, are all methods of sensing the environment and modifying it; they form the ecosystem into which RFID systems must be inserted today. Some readers provide ports for the system to detect some basic on/off sensors. However, most sensors and actuators provide complex functionality that most likely cannot be supported by the reader ports. It is necessary to keep these additional devices in mind while designing an RFID deployment. MIDDLEWARE AND VISIBILITY INFRASTRUCTURE Middleware in the EPC Network is the layer that enables applications to work with RFID infrastructure. The middleware must perform two classes of functions: data management and system management. Data Management Data management can occur at local sites, where the middleware manages readers and devices. We refer to this as edge visibility. Data management is also necessary at the enterprise. We refer to this as enterprise visibility. Edge Visibility Applications like warehouse management systems implement business logic of an enterprise. Automatic identification systems are low-level data-capture devices that provide fragmented snapshots of inventory in the form of tag sightings. This problem does not occur in bar-code systems today because the human operator implicitly pieces the information back together, deals with exceptions, performs correlations, and provides the application with the highlevel, reliable information it seeks. While RFID readers automate the tedium of manually scanning individual items, they do not eliminate the fragmentation problem by themselves. Fragmentation occurs in several ways. First, read data is fragmented geographically: antennaby-antenna, reader-by-reader and site-by-site. Second, snapshots are fragmented by device; for example a motion-sensor event might arrive separately from a read-event, and the two might need to together trigger a display telling a forklift operator that the pallet can be picked up off the conveyor. Third, snapshots are fragmented in time. Sometimes, data accumulates redundantly, and sometimes it occurs infrequently due to interference or physics problems. Finally, when reading a region, a tag that should be seen might not be sighted, while a tag in a neighboring reader s field might occasionally crop up due to a reflection. Overlaid on these problems of fragmentation is the challenge of inferring reality, and of presenting information that is semantically relevant to the application. For example, fragmentation may make it impossible to read all the cases in a pallet; however, the application might want to infer from the EPC's of just a few cases that the entire pallet is intact and present. In other words, despite the fragmentation, the application demands information with the gaps filled in. EPC-IS Edge Server has a sophisticated model for data management that captures the operation logic of a logistics deployment. At the lowest level, EPC-IS Edge Server can perform advanced filtering, but at higher levels, it can also perform complex reasoning. EPC-IS Edge Server underlying eventoriented system can model complex data interactions to create actionable business events, or to trigger commands to actuators or displays. EPC-IS Edge Server was developed by the same engineers who pioneered the Savant system for the Auto- ID Center. 11

12 Data management at the edge refers to this piecing-together of all the fragmented data to create a coherent picture of the what, where and when of inventory in an enterprise. The result of good data management is actionable information and events, rather than amorphous data. By performing data management, the middleware insulates the application from site-specific operational logic, and permits the application to execute business logic at a higher level of abstraction. Data management at the edge occurs at sites like warehouses and distribution centers, and presents information to applications like warehouse management systems. Enterprise Visibility The goal of data management at the enterprise is to present a unified view of the assets of the enterprise at a single, homogenous level across all functions. Data must also be shared across enterprises so that the material movement between companies is also seamlessly viewed on a single platform. Enterprise visibility, along with the applications it enables, is the ultimate goal of RFID. Enterprise visibility will enable an extraordinary range of functions from improving existing applications to enabling new ones. For example, replenishment planning is an application that exists today, which can be greatly enhanced by RFID data. On the other hand, product recall, down to a serial number, is a brand new application enabled by RFID. Both these applications need a store of EPC data that presents EPC-oriented information at multiple levels of resolution, and at multiple levels of performance. Implementing enterprise visibility is thus an important but difficult task. The key challenges are managing huge data volumes and yet achieving good performance at acceptable costs. System Management RFID deployments require hundreds of devices that will need to be configured, managed and operated in a seamless, secure and automatic manner. This is system management, and it is the second important function of RFID middleware. It is important to note that system management functions are not unique to RFID although many methods of system management are. Network routers, Wi-Fi access points, printers, servers, and other devices require similar functions, and there are standardized approaches with existing tools and developer bases. Security Security is a complex subject, and while it is impossible to do justice to the topic in this introductory paper, we present a summary here. The term security refers to three primary desires in computer systems: confidentiality, integrity and availability. In RFID systems, security is an issue at the interfaces between the four layers, namely: the connection between the readers and the tags, the connection between the middleware and the readers, and the connection between 12

13 applications and the middleware. The reader to tag layer is one in which there are few choices. Seminal work in RFID reader-tag systems was done by Engels, Rivest, Sarma and Weis. 2 Because the computational power available for implementing security mechanisms increases as we move up the stack of layers, the ease of establishing rock-solid security between layers also increases as we move up. First, some basic questions. Is it possible for an antagonist to eavesdrop on an RFID system from a distance? The answer is no because of the way the air-interface protocols are designed, and because of physics. A detailed explanation can be found in (Weis 2003). Can the tag discriminate between readers and respond only to authorized readers? The answer is no and this is the source of privacy concerns with RFID when RFID tags are used in consumer items. However, three mitigating factors exist. First, the physics of RFID make it difficult for an antagonist to read tags from a distance. Second, EPCglobal protocols accommodate a kill command that a consumer can use to permanently deactivate tags. Third, EPCglobal has published a public policy that the industry has signed up to use on a self-regulatory basis. 3 Can readers discriminate legitimate tags from fake (mimicking) tags? The answer is no with low-cost tags because this needs encryption. If the answer were yes, then tags could be used as a foolproof anti-counterfeit measure. As it is, just the presence of a tag is sufficient deterrent for counterfeiting because a counterfeiter will likely find it difficult to acquire tags in the short term. The layer between the middleware and readers comes next. Although this connection is usually over a LAN, it is often asked what is the preferred method of protecting this connection. The concern surrounds an antagonist accessing readers without authorization and either intercepting data or modifying settings. Fortunately, this problem has received a great deal of attention in the Internet and World Wide Web communities. The most widely used solution to this problem in applications ranging from Web-based banking to e-commerce is the Secure Sockets Layer. There are several freeware versions of SSL available, and it is a well-known, well-understood, non-proprietary standard. Using SSL, instead of re-inventing the wheel or adopting an unknown and untested new standard, presents a safe, economical and prudent way forward. The third interface is that between the middleware and the application. This too is a problem with a number of well-understood, standard solutions, and some new ones. The key problem here is one of access control. The Web Services community is developing a broad suite of standards in this space, as is EPCglobal. Once again, it is prudent to adopt the best-of-breed industry standards in this layer. 2 Engels, D. W., Rivest, R. L., Sarma, S. E. and Weis, S. A., Security and Privacy Aspects of Low-Cost Radio Frequency Identification Systems, First International Conference on Security in Pervasive Computing (SPC 2003), March 12-14,

14 Finally, the answer to a commonly asked question: can RFID systems get viruses? RFID tags are too simple to support a virus. Readers are insulated from viruses by good middleware design. However, the underlying operating system must be protected from viruses using standard safeguards. Configuration Full-fledged RFID deployments may involve hundreds of readers. The automation that RFID promises comes, with the inevitable need for complex logic and exception handling in which middleware must supplant the human operator. The middleware will need to set up the hundreds of readers, as well as control other devices, which will run in concert to perform logistics operations. Devices will include sensors (like light-sensors), programmable logic controllers (PLC s), and displays. Configuration will involve not only the set up of readers and the registration of their logical interpretation (i.e., is this a dock-door reader or a conveyor reader) but also the setup of their priorities, the calibration of reader interference characteristics, the assignment of interference-resolution policies, the determination of over-ride policies, and so on. For example, if a conveyor requires radio silence so that it can complete a time-critical read without interference, it can achieve this using its higher priority. However, if an even higher-priority reader over-rides the conveyor, the conveyor may need to be stopped to buy air time to finish the read. In massive RFID deployments, bandwidth, or airtime will become a critical commodity that will need to be carefully apportioned to competing readers. Under these circumstances, the ability to configure complex behavior, and the ability to do so with ease and convenience, will be a major factor in the cost of implementation and operation of RFID systems. EPC-IS Edge Server permits centralized configuration of devices, device constraints, locations, device schedules and override priorities. The configuration is based on a sophisticated constraint model of frequency and time resources, and permits the RFID system to make rational decisions when two readers compete for the same resource. Reader self-configuration is an extremely important functionality in RFID systems that could fundamentally change the set-up and maintenance costs of RFID systems in the future. Seminal research on this subject was done by Engels and Sarma. 4 Unfortunately, support of the primitive functions that will enable reader self-configuration in practical deployments (instead of in the lab) is limited. Today, only a small fraction of the readers available in the market permit even the most basic RF sensing and auto-configuration. Reader manufacturers are gradually adding the necessary functions to enable more intelligence and functionality in RFID deployments. 4 Engels, D. W. and Sarma, S. E., The Reader Collision Problem, Proceedings of IEEE International Conference on Systems, Man and Cybernetics, Hammamet, Tunisia, October

15 Device Management Complex systems like RFID installations require constant monitoring to ensure high uptime and optimal performance. Disabled antennas, disconnected readers and inactive electronics all must be detected and quickly repaired. Ideally, the system should support SNMP (Simple Network Management Protocol) standard as a means of monitoring and maintaining readers and other devices. SNMP managed devices can be monitored and from SNMP management consoles. Reader firmware updates are a frequent occurrence in this nascent industry. As previously described, firmware updates occur today to either fix bugs or improve performance, but in the long run, will be necessary to stay current with changing protocols and regulations. Finally, fault-tolerance is an important consideration in RFID systems. When RFID becomes the life-blood for a companies commerce, it is necessary that system failures not slow or impede commercial operations. Disk failures, motherboard failures and memory failures that are affordable in a pilot are likely to cause a great deal of pain in real deployments. Reader hardware hot-swapping is another example of fault tolerance. A failed reader cannot be maintained on the fly; it will need to be removed and replaced. The new reader must be able to quickly configure itself with little effort, and the system must be able to resume normal operation seamlessly. Advanced functions like hot swapping will be necessary for RFID deployments to be truly robust in the years ahead. EPC NETWORK AND APPLICATION INTEGRATION The Auto-ID Center and EPCglobal have developed, and continue to evolve, an elaborate infrastructure designed to enable global commerce and to lubricate the supply chain. In this section we describe how the various elements fit together. Middleware Access Standards The middleware layer can be accessed from the outside world through emerging standards like the web-services based standard called the EPC Information Service (abbreviated to EPC-IS). At a basic level, EPC-IS is a service that allows an application to request the core information offered by the middleware, namely the where (which reader), the what (which tag) and the when (timestamp) of EPC events. A lower level standard called the Application Level Events (ALE) is also emerging. The language to capture this information is the core product markup language, PML-Core, an XML based representation. 15

16 There is a great deal of ongoing discussion about extending the basic events in three directions. First there is the question of whether EPC-IS should support not just reader names, but higher-level location interpretations like the logical name of a room, a forklift or dock-door. Second, there is a clear need to support aggregation hierarchies like pallets containing cases, and cases containing inners or items. There is also discussion in the EPC-IS forum whether there should be extensions that permit: The addition of static information associated with the EPC, like manufacturing batch number, or information for compliance with the FDA. The addition of transaction semantics to an EPC, like shipment information. This information would be captured in a language called PML-extensions, which would also be XML-based. EPC Network Infrastructure Services The primary infrastructure supported by EPCglobal is the Object Name Service (ONS), a service that enables an application to find the EPC-IS of the manufacturer or initiator of that EPC. ONS is also being extended to find other servers that provide other services pertaining to a given EPC or range of EPC s. There is also a great deal of ongoing activity to standardize other types of registries which will enable two corporations that conduct commerce with each other to discover each others'services seamlessly and to establish secure channels for communications and business transactions. Existing Applications The ONS and the middleware are together designed to enable today's applications to incorporate RFID and EPC, and to plug into the EPC network. OAT offers a number of methods of integrating existing applications with the middleware. At the edge-level, OAT has integrated EPC-IS Edge Server with applications like warehouse management systems through a well-established API. OAT also works with a number of Enterprise Application Vendors like WebMethods, IBM, Tibco and Sonic to integrate with applications. To date, OAT has the most extensive on-the-ground experience in RFID integration in the world. EPC-IS Edge Server supports advanced fault-tolerant functionalities like clustering and fail over, which make the system virtually immune to hardware failure. Multiple machines in the cluster will be able to maintain 100% state replication, and swap from one to another when a fault occurs. EPC-IS Edge Server also supports hot swapping. 16

17 MARC GLOBAL AND OATSYSTEMS The MARC Global and OATSystems partnership enables companies to leverage industry-leading technologies for a complete RFID solution. The joint offering consists of the MARC RFID Compliance Kit and the MARC RFID Enterprise Edition. OAT EPC-IS Edge Server RFID Reader(s) MARC Suite SOAP-Based Web Services MARC RFID CUSTOMER COMPLIANCE KIT Loftware RFID Printer(s) The MARC RFID Compliance Kit is an easy to implement and lower cost solution aimed directly at fulfilling the requirements of Wal-Mart and DOD. This solution is standards-based and complies with Class 0 and Class 1 Reader Support required by Wal-Mart as well ISO for DOD. The Compliance Kit delivers flexible tag commissioning capabilities that support programming various types of RFID tags as well as printing RFID EPC labels. Tags can be verified prior to labeling, after case labeling, as well as after a pallet has been built to verify tag performance. It meets the requirement for EPC management, Tag Quality Assurance (including the situation where different form factor tags are required for different product characteristics), Case to Pallet Linkage, and EPC enabled ASNs. Scalability has been proven to over 6,000 transactions per second and can support 100+ readers on an inexpensive server. "MARC Global is an excellent company to partner with as they have solved many of the complex challenges that very demanding customers have faced," said Prasad Putta, CEO, OATSystems. "The MARC Suite product line is highly functional, well proven and very easy to configure allowing it to be adapted to the ever-changing needs these companies have. Both of our companies products are proven and designed with agility, ease of deployment and use, and low cost of ownership in mind. It is a strong combination that provides synergy for our customers." 17

18 MARC RFID ENTERPRISE EDITION The MARC RFID Enterprise Edition goes far beyond mere customer compliance to deliver more value from RFID. In addition to the functionality offered in the MARC RFID Compliance Kit, Enterprise Edition delivers additional RFID functionality for supply chain execution functionality across the enterprise: EPC commissioning to associate EPCs to inventory earlier and at various points within the supply chain. Automated receiving. MHE sortation integration. Inventory management functions. Shipment verification. Zone alarms (must be in vault, cooler, security cage). Anti-counterfeiting management. Visibility and analysis of EPC data. MARC RFID is designed to offer maximum configurability and adaptability to the ever-changing needs our customers have in their warehousing environments. The value of the MARC Global RFID Enterprise solution includes: Reduced Costs From RFID. o Reduced need for manual inspection and even RF data entry. o Improved asset utilization reduces capital expenditures. o More efficient supply-chain management reduces need for safety stock. o Reduced theft and loss minimizes associated expenses. o Better regulatory tracking and tracking alerts keep regulated materials under tight control. o Reduced counterfeiting through tight real-time tracking. o Alerts (including temperature sensing) as to product status reduce perishable spoilage. Greater Efficiency From RFID. o "Self-regulating" supply chain ensures optimal production and inventory levels. o Automated data capture eliminates time-consuming and error-prone manual processes. Improved Service From RFID. o Better inventory regulation means fewer stock-outs. o More accurate data capture and management reduces likelihood of pricing errors, shipping errors, etc. Increased Profitability From RFID. o Better inventory and production management yields higher profits. o Real-time visibility results in better, more profitable decisions. o Streamlined processes and automation make for more profitable operations. 18

19 The MARC RFID Compliance Kit and Enterprise Edition solutions are based on MARC s next-generation architecture that achieves sophistication through simplicity. MARC s revolutionary architecture provides unmatched adaptability, investment protection and scalability. In an independent benchmarking study, the MARC solution was able to plan and optimize 2,000,000 order lines (from interface to available on the floor) in just 90 minutes. The MARC solution outperformed our nearest competition by a factor of 10! OATSYSTEMS EPC-IS EDGE SERVER SOLUTION The MARC Global RFID solution is based on the OAT EPC-IS Edge Server solution. Springing from OAT S work developing key RFID technologies for MIT's Auto-ID Center, EPC-IS Edge Server is the world's most widely deployed RFID software suite. The EPC-IS Edge Server Suite provides a complete and powerful standards-based RFID solution for companies in the retail, CPG, manufacturing, pharmaceutical, and logistics markets. EPC-IS Edge Server s flexibility is proven by its compatibility with RFID readers, EPC printers, PLC s, Bar Code readers and solutions from over 20 different manufacturers including most of the leaders such as Alien, Matrics, Phillips, Texas instruments, Tyco, Intermec, Zebra, Symbol, LXE, and Loftware. The EPC-IS Edge Server Platform Built around open industry standards, the EPC-IS Edge Server Platform collects data from leading RFID hardware devices, turns that data into intelligent and actionable business objects, and then seamlessly integrates it into enterprise applications such as ERP, warehouse management, supply chain management, and manufacturing execution systems. EPC-IS Edge Server excels at handling large volumes of data, and can run hundreds of RFID readers off a single server, while eliminating the problems that stem from RF interference, as well as duplicate or spurious reads. With Web-based configuration management, support for SNMP, and robust APIs, EPC-IS Edge Server is both simple to manage and simple to extend. The EPC-IS Edge Server platform is utilized to collect the data from the RFID devices in a warehouse and then transmit the information to the MARC RFID solution. The MARC RFID solution (either the Compliance Kit or the Enterprise Edition) then uses the information from the RFID devices to optimize activities within the warehouse. 19

20 By utilizing the joint solution from MARC Global and OAT, customers have the ability to leverage an integrated best-of-breed solution to meet all of their RFID requirements. OAT s expertise coupled with EPC-IS Edge Server's strict adherence to standards and support for all major brands of RFID hardware, combined with MARC s expertise and product capabilities with warehouse management systems, allows us to deploy RFID solutions in a fraction of the time, and at much lower total costs of ownership, than from any other alternative. VISION 2020 The grand vision of the EPC Network is to provide comprehensive, unified, realtime visibility into the material assets of an enterprise, enabling the high resolution supply chain. MARC Global and OAT are dedicated to enabling this mission by implementing a single enterprise-wide visibility layer, which enables any person or system in a company to view EPC-tagged items across the enterprise, from the supply-chain expert to the marketer, from the planning software to the warehouse management system. The data can be viewed at different levels of detail-from business intelligence for company executives, to operational data which captures the what, where, when and why of events in the value chain. Cross-enterprise visibility, which extends beyond company boundaries, will further enable efficient, just-in-time commerce between companies. This will reduce loss, increase efficiency, cut stock-outs, and most importantly, enhance profitability. The strategic importance of visibility arises from a number of converging industry trends: the evolution of vendor-managed inventory and consignment models, the increasing importance of 3PL's, the importance of brand protection in an increasingly global marketplace, and most generally, the ever-sharpening trade-offs between inventory loads and service levels. 20

21 ABOUT MARC GLOBAL MARC Global is recognized as one of the world s premier supply chain execution solutions companies with a long history of improving customer fulfillment, profitability and cash flow for the world s most demanding companies. We achieve measurable results by solving our customers most sophisticated supply chain challenges with our MARC Suite solutions. MARC Global solutions have been successfully implemented in hundreds of sites worldwide and in multiple languages. We have full-service offices in the U.S., Europe and Asia Pacific, all backed by implementation experts and a global support staff on call 24 x 7 that is ready to help you achieve operational excellence. For over a decade, our capabilities, depth of experience and distinguished partnerships have enabled us to deliver measurable results for successful clients of all sizes. ABOUT OATSYSTEMS Founded in 2001, OATSystems, Inc. is the developer of the world's most widely deployed standards-based RFID solutions. The company has worked closely with MIT's Auto-ID Center, now EPC Global, to develop many of the key standards and technologies that make commercial deployments of RFID possible. OAT s EPC-IS Edge Server the company's flagship product provides a complete and powerful standards-based RFID solution for companies in the retail, CPG, manufacturing, pharmaceutical, and logistics markets. OAT is headquartered in Watertown, Massachusetts, with a development office in Hyderabad, India. The company is privately held, and is backed by Matrix Partners and Greylock. To learn more about the powerful MARC Suite solutions, call , info@marcglobal.com or visit our web site at 21

22 APPENDIX A: Warehousing Efficiencies The following is adapted with permission from Warehousing Efficiencies, originally appearing online in RFID Journal, October 14, Squeezing inefficiencies out of the supply chain will mean turning transshipment points into engines of efficiencies. It is critical to have a vision for what your company will look like when it is gathering data on everything it makes, moves or sells using RFID. Here we look at the use of RFID in warehouses and distribution centers, which will likely be where many implementations start. And we'll show you how you can move from automating some simple data collection tasks to totally transforming your supply chain. Members of the EPCglobal (Auto-ID Center) who participated in the field test ran their own pilots deploying RFID in warehouses and distribution centers by simply using RFID tags instead of bar codes. Initially, they will likely track just what's coming into and leaving the warehouse with RFID and use bar codes to identify the goods within the warehouse. The benefit: a reduction in the amount of time it takes to match actual goods received or shipped to what the paperwork said should be shipped or received. This is a very basic first step, but the savings involved are significant enough to encourage companies to begin adopting RFID technology. Labor costs account for 50 to 80 percent of the overall cost of running a distribution center, according to IBM Business Services. Twenty to 30 percent of labor is typically devoted to receiving. If pallets are delivered to the distribution center (DC) with RFID tags, the amount of time it takes to compare the items delivered to the expected delivery can be cut by 60 to 90 percent. (Obviously, much more time is spent confirming goods on a mixed pallet, so it depends on the type of warehouse or DC.) Installing portal readers is not hard, but it still requires sound engineering. One field test used wooden pallets with two tags in diagonally opposing corners to improve the odds of identifying the pallet. The system was not set up to achieve a 100 percent read rate. It was designed to pick up only one of the two tags on the pallets. So even though the tags were read only 78 percent, 96 percent of all pallets were properly identified. Still, that's not good enough to justify huge investments in an RFID system. Some of the problems were attributable to human error. Pallets went out doors without readers. Goods were put on pallets without tags. Once, the system was accidentally unplugged. One reader failed, and one antenna was damaged. 22