RFID Automation and Extensibility A Roadmap to RFID Integration on a SAP Centric Platform

RFID Automation and Extensibility A Roadmap to RFID Integration on a SAP Centric Platform Dave Perrine VP Marketing PEAK Technologies Dave Marzouk RFID Solution Director/Partner Management SAP Labs, LLC Chris Schultz Sr. SAP Systems Architect PEAK Technologies

Agenda PEAK Technologies Overview SAP Vision Fast Forward to 2007 Leveraging your SAP Investment Build a SAP centric RFID platform Realize the Power of SAP s Auto-ID Infrastructure Convergence of Automatic Data Collection Technologies Bar Code and RFID coming together Bar Code, RFID, Voice and Imaging it is all AIDC RFID in Action 2

PEAK Technologies Incorporated under the PEAK name in 1986 A Platinum Equity Company ranked 18 th largest private company in US by Forbes magazine PEAK is a systems integrator of: SAP SCM/LES Enterprise Solutions Auto ID systems and services Enterprise printing & mobility Wireless professional services Life-cycle support services $150M (Est. 2006 Revenue) Over 600 employees 60+ Sales Resources 30+ Systems Resources Service Resources 300+ 3 3

PEAK s SAP Partnership Powered By SAP NetWeaver Joint SAP RFID Partner Marketing Program SAP Partner Software SAP Independent Software Vendor with Certified Integration 4

SAP Vision: Create a Real-Time Adaptive Enterprise 6

Enterprise is a collection of Business Processes Enterprise can be viewed as a set of inter-dependent dynamic business processes that need to be monitored and controlled 7

An Enterprise is one node in a Business Network Supply Chain Government Demand Chain Manufacturing Broker Retail Customer Equipment Supplier Distribution Center Enterprise Distributor or Wholesaler Consumer Goods Supplier Advertising Agency Food Service some of which involve a network of suppliers and business partners 8

Real World Awareness Enabled at Various Levels Data & Events Enterprise Network Network Applications Applications Network Enterprise Manufacturing Retail Store Distribution Business Logic Edge Device 9

SAP Vision -- Evolution of the Adaptive Business Network Plan and re-plan resource needs based on business objectives PLAN VISIBILITY RESPOND Collaborate and Respond to internal and external deviations across the extended network LEARN Sense and alert in real time the deviations caused by internal and external events SENSE EXECUTE Execute plan based on available supply chain network resource capability Continually analyze and learn from exceptions and incorporate knowledge into business processes 10

SAP - Real World Awareness Defined Did we pay the correct tariff? Which containers contain hazardous materials? What is in this mixed pallet? Which manufacturers are these cases from? What discount can we provide this customer? What can we cross-sell this customer now? Does this order match the bill of materials? Why is this shipment incorrect? What is my available inventory and how much should I order? Are there any impending out of stocks on my popular products? 11 Are these out of date or defective products? Where are the repaired assets?

SAP Real-World Awareness Defined Real-World Awareness is the capability to sense information in real-time from people, IT sources, and physical objects using technologies such as RFID, Sensors, etc., incorporate into business processes and drive new levels of visibility, control and responsiveness Ability to Sense Time to Respond Time Delay Data Accuracy and Volume 12

SAP Auto-ID Infrastructure Architecture High Level Execution Devices Backend Systems Device Controller Device Integration Human Integration Core Services Action & Process Management Configuration & Admin Management Association Data Management Logging & Archiving Backend System Integration XI mysap ERP mysap SCM Legacy Intelligent Device SAP Web AS AII Other 13

SAP Auto-ID Infrastructure and SAP Event Management: Complementary Enablers of Real World Awareness Domains of SAP AII Gateway for all SAP Applications to the world of RFID and Sensor Data Provides business context to RFID & Sensor data by associating them to business processes Creation, management and system of record of and non- based serialized data Local implementation and automated execution of RFID enabled business processes Domains of SAP EM Enables process visibility, monitoring and control by managing events within and between companies Track planned vs. actual events at various levels Automated exception resolution by notification and workflow triggering in other SAP systems Supports events from variety of sources: RFID, B2B, Manual,.. SAP AII is closer to the physical process, whereas SAP EM is closer to the exchange and monitoring of event data across locations and trading partners 14

Fast Forward to 2007 Wal*Mart/DoD Wal*Mart/DoD Mandates Mandates Global Global Formed Formed Wal*Mart Wal*Mart Top Top 100 100 Business Business Cases Cases & Pilots Pilots 2003 2004 2005 2006 2007 Additional Additional Mandates Mandates Gen Gen 22 Ratification Ratification Wal*Mart Wal*Mart Top Top 200 200 Closed Closed Loop Loop Applications Applications Early Early Deployments Deployments Broaden Broaden 16

Fast Forward to 2007 2007 Enterprise Wide Production Production 17 Process Process Control Control Materials Materials Management Management Transportation Transportation Container Container / / Pallet Pallet Tracking Tracking Loss Loss Reductions Reductions Transportation Transportation Status Status Sorting Sorting Warehouse Warehouse Management Management Goods Goods In In / / Out Out Storage Storage Management Management Automated Automated Inventory Inventory Aerospace Aerospace and and Defense Defense Retail Retail Materials Materials Management Management Track Track and and Trace Trace Maintenance/Repair/Overhaul Maintenance/Repair/Overhaul (MRO) (MRO) Shelf Shelf Replenishment Replenishment POS POS Pharmaceutical/Healthcare Counterfeiting Counterfeiting Loss Loss and and Prevention Prevention Patient Patient Tracking Tracking Asset Asset Management Management Asset Asset Tracking Tracking

RFID Adoption Stages -- Retail High Value Low Track & Trace Limited Products Standalone Capabilities Track & Trace Plus Productivity Inventory Productivity Plus Retail Minimum Requirements Drive Internal Benefits 1 1b 2 2b N 3 Intra-facility Read Points Lite Inventory Control Integration More Products Scale Volume Full Integration to Order Information Tags Applied with Automation Increased In/Out Read Points Lite Integration to Order Information More Products/Customers Additional Business Intelligence -Analytics on Historical Information -Predictive Logic Total Supply Chain Visibility Source: Accenture Time 18

Leveraging Your SAP Investment ROI Resources Training Core Skill Sets Migration Path SAP native SAP certified solutions Ongoing Services and Support Managing the Risk 20

Managing the Risk 6 Go-Live Go-Live 4 5 Realization Final Preparation Final Preparation Go-Live System Acceptance Ongoing Support On-Site Integration Testing Training 2 3 Planning Blueprint Software Configuration RFID System Process Staging RFID Hardware & System Installation RFID Analysis & Blueprint Report RFID Hardware Recommendation 1 Project Initiation Project Initiation RFID Site Analysis RFID Product Tag & Hardware Compatibility Test 21

Realize the Power of Auto-ID Infrastructure An SAP Centric Solution A Gateway to Automation for the Management of Enterprise Operations More than just RFID PLC s Voice Solutions Bar Code Data Collection Devices Print Applicators Bluetooth Devices Packaging Equipment Sorters Etc. Centralized and Decentralized Environments 23

Realize the Power of Auto-ID Infrastructure An SAP Centric Solution mysap ERP SAP Web Application Server SAP Exchange Infrastructure SAP Auto-ID Infrastructure Real-Time Machine Infrastructure PEAK Automation Controller PLC s In-Motion Scales In-Motion Readers Printer Applicators RFID Readers ASRS Voice Light Pick/Put Conveyors Packaging Equipment Sorters RF Data Capture 24

Landscape: Centralized Corporate Data Center R/3 R/3 Dbase Web Application Server 7.0 AII Automation Controller AII Dbase SQL/Oracle Dbase allows for Offline capability LAN/WAN Remote Remote Remote Remote Remote Sites Sites Sites Sites Sites 1 2 3 4 X 25

Landscape: Decentralized Corporate Data Center R/3 R/3 Dbase WAN AII AII AII AII AII Automation Controller Automation Controller Automation Controller Automation Controller Automation Controller Remote Sites 1 Remote Remote Remote Remote Sites Sites Sites Sites 2 3 4 X = SQL/Oracle Dbase allows for offline capability AII Dbase AII Dbase 26

Convergence of Automated Data Collection Technologies Business Processes will evolve and become more complex when going from a Slap and Ship RFID environment to an Enterprise Wide environment Strategic Integration of diverse Automated Data Collection technologies in an Enterprise Wide environment allows for deployment of the optimal technology to drive more efficiencies in business processes Bar Code Voice RFID working together to drive enterprisewide efficiencies 28

Typical Warehouse Process Flow Receive w/rfid Mobile Receive w/bar Code Inspect w/rfid Inspect w/bar Code Cross Dock w/voice Putaway w/rfid Forklift Putaway w/bar Code Putaway w/voice Receive to Warehouse (Supplier or Production) Receiving Inspection Cross Docking Put-Away to Storage Packing Picking Transfer within Storage Pack/Ship w/rfid Forklift Pack/Ship w/rfid Mobile Pack/Ship w/bar Code Pack/Ship w/voice Ship to Customer Pick w/rfid Forklift Pick w/rfid Mobile Pick w/bar Code Pick w/voice Transfer w/rfid Forklift Transfer w/bar Code Transfer w/voice 29

Inbound Receipt Processing SAP R/3 1) 1) Inbound Inbound Receipt Receipt in in R/3 R/3 to to IM IM Web Application Server 7.0 AII 4) 4) Numbers Numbers commissioned commissioned in in AII AII & & sent sent to to applicator applicator RFDC Vehicle Mounted Reader Antenna Automation Controller 2) 2) Break Break down down pallet pallet on on conveyor conveyor Scanner Label Applicator Antenna RFID Reader Divert if invalid 5) Cases put into inventory 5) Cases put into inventory 3) 3) Read Read Pre-existing Pre-existing UPC UPC barcode barcode 30

Picking and Pallet Aggregation Processing SAP R/3 Web Application Server 7.0 AII Automation Controller 1) 1) Outbound Outbound delivery delivery created created in in Aii Aii from from R/3 R/3 via via XI XI 2) 2) Assign Assign AII AII Outbound Outbound delivery delivery for for picking picking 3) Pick / Pack inventory 3) Pick / Pack inventory 5) 5) Pallet Pallet tag tag commissioned commissioned & & hand hand applied applied 4) 4) Case Case tags tags read read for for Pallet Pallet Aggregation Aggregation 31

Outbound Delivery Processing SAP GUI Workstation RFDC Vehicle Mounted Reader Vs. Dock Door Portals SAP R/3 Web Application Server 7.0 AII 1) 1) Assign Assign AII AII Outbound Outbound delivery delivery to to dock dock door door Feedback Loop Lightstack Automation Controller Antenna 3) 3) Post Post Goods Goods Issue Issue transaction transaction is is posted posted in in R/3 R/3 from from Aii Aii via via XI XI 2) 2) Driver Driver loads loads delivery delivery light light exception exception process process RFID Dock Door Portal 32

RFID in Action 4 RFID implementations Each solution based on SAP NetWeaver technology 2 fully integrated 1 semi-integrated 1 slap & ship 3 Wal*Mart suppliers, 1 Best Buy supplier 3 were early adopters Varying technical architectures 34

PEAK s Customer Success Stories Pacific Cycle SAP and PEAK partnered with Pacific Cycle which became SAP s first Auto-ID / PAC Infrastructure implementation in the US Fully integrated to R/3, using retail link Portal Readers for outbound shipments to Wal-Mart RF enabled transactions by connecting directly to mobile devices from SAP Auto-ID 325+ Infrastructure through WebSAPConsole 100+ 50 35 35

PEAK s Customer Success Stories Major Audio Products Manufacturer SAP and Peak partnered to implement Auto-ID Infrastructure / PAC to meet the Best Buy compliance mandate Fully integrated solution into SAP 4.7 Extension set 1. Custom delivery document processing, SD/AII Packing processes and Outbound shipments/deliveries Migrating to Gen2 with Print & Apply 325+ 100+ 50 36 36

Peak s Customer Applications Lawn and Garden Products Required to meet Wal*Mart mandate January 2005 Incorporated Print and Apply solution on production lines as well as open air encoding capabilities. Unique product/packaging challenges, Standard and RFID product merging into a 325+ single packing station 100+ Fully integrated solution into SAP s R/3 WM, 50 IM, PP and SD 37 37

Peak s Customer Applications Consumer Goods Manufacturer Production Order Receipt and Outbound Delivery Deployed RFID for all SKU s at two Texas facilities utilizing Gen 1 RFID technology Migrated to Gen 2 RFID technology, rolling out to additional sites Using RFID to build competitive advantage 100+ 50 325+ 38 38

For More Information Questions and Answers For More Information David Perrine PEAK Technologies david.perrine@peaktech.com 410-312-6012 Dave Marzouk SAP Labs, LLC dave.marzouk@sap.com 949-887-5753 For more information on PEAK Technologies SAP offerings visit www.peaktech.com 39