ABI Research Sees RFID Applications to MRO
ABI Research says RFID initiatives in the aerospace and defense industries have great potential for savings and revenue, particularly in the areas of maintenance, repair and overhaul or MRO. "A&D companies have evolved a new supply chain equation: maintenance strategy plus supply side strategy equals supply chain strategy," says ABI Research director Michael Liard in a report on this subject. "RFID can fulfill many MRO event requirements by enabling real-time track and trace and unique identification." RFID tagging technology can streamline such tasks as locating parts, tools and materials, Liard says, as well as facilitate preparation of the significant amount of documentation required to meet regulations in the aerospace and defense industries.
"An integrated MRO supply chain can improve service performance in a manufacturer's storeroom by simplifying inventory, purchasing, and other business processes," the report states. "Integrated supply allows the centralization of all sourcing, procurement, receiving, internal distribution and service to one supplier. The full benefit of integrated supply is achieved when all MRO supply chain functions are outsourced, thereby allowing a plant to better focus on its core competencies."
http://www.ecommercetimes.com/

Aberdeen Looks at RFID's ROI
Even though RFID has reached a tipping point, only 10 percent of companies recently surveyed by Aberdeen Group have had an RFID initiative for more than five years. Among early adopters, over half generate more than $5bn in annual revenue and have invested an average of $1.5m in RFID technology -- about three times the average, according to the report, Finding the ROI in RFID. Some 85 percent achieved a positive ROI within the first five years. However, all of them, when asked, considered the bulk of the benefit still to be "in the future." Aberdeen says that measuring the ROI is still a challenge that deters many organizations from adopting the technology. According to the report, ROI depends greatly on the business problem, the approach, commitment to leveraging the technology, and ability to turn RFID data into business intelligence. Aberdeen's research shows that the average time an organization needs to recover an RFID investment is 30 months, with the low being 18 months and the high being 48 months. The research, underwritten by ADT Security Services, TrenStar Inc., and Intelleflex Corp., explains the advantages of RFID, and the various ways to measure its ROI.
http://www.usingrfid.com

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UK Grocery Distributor Uses RFID Seals
A large UK grocery distributor, Nisa-Today's, is using RFID-enabled resuable electronic seals on its trailers as an increased security measure. The seals, whenever they're closed, record a random four-digit number as well as the date and time. The use of a random number ensures that each opening and closing will be captured. Yard operators can retrieve this information via an interrogator at the gatehouse or around the yard.
http://www.rfidgazette.com

How Will RFID Affect Jobs?
As RFID technology and applications become more widespread, they have the potential to impact organizations' labor requirements dramatically, particularly in the retail sector. The nature of that impact is the focus of two reports from the International Labor Organization (ILO), which held a three-day meeting at its Geneva headquarters in September to discuss the implications of RFID on retail employees. The ILO, a specialized United Nations organization, formulates international labor standards and frequently campaigns against forced labor, child labor and poor working conditions worldwide; it also tackles industry-specific problems. Social and Labor Implications of the Increased Use of Advanced Retail Technologies, a 63-page report published before the meeting, summed up how radio frequency identification is currently being utilized, and how it will likely be used in retail. The document concluded that some retail jobs may be lost in the transition to RFID, but that many workers could be moved from routine warehousing tasks to customer-service jobs. With appropriate training, the report states, RFID could be implemented in such a way that raises productivity, increases customer satisfaction and leads to better conditions and benefits for workers.
http://www.rfidjournal.com

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New Security Features Target Counterfeiting
New RFID tags with special security functions hold promise for pharmaceutical supply chain applications. The tags were unveiled in conjunction with the NACDS (National Association of Chain Drug Stores) and HDMA (Healthcare Distribution Management Association) RFID Health Care Industry Adoption Summit in Washington, D.C. There, a number of RFID vendors sought to address the growing concerns among drug manufacturers and pharmaceutical supply chain managers about the growing incidences and increasing sophistication of counterfeiting.
A passive UHF-compliant tag from SecureRF has onboard security and cold chain management features, according to SecureRF CEO Louis Parks. The tag uses a patented cryptographic protocol called the "Algebraic Eraser" that allows authentication and data protocols to be directly encoded. The technology can actively authenticate and encrypt reader/tag communications, and is designed for pharmaceutical manufacturers and distributors who want to provide a tamper-proof record that a particular drug is authentic. The tag also comes with a battery-powered temperature sensor that continuously monitors and securely records an item's temperature history.
The secret to the tag's functionality, says Parks, is the mutual authentication between tag and reader. Unlike standard applications, the tag isn't simply storing secured information or signatures that, even if encrypted, may be cloned. With the SecureRF solution, only authorized readers may access the sensitive information. "In each session between the reader and the tag, we send uniquely encrypted information, so if you were eavesdropping, what you hear could be different every time you listen," he says
Certicom Corp. also demonstrated a new, secure tag for pharmaceuticals and other high-value items at the D.C. conference, in parthership with Texas Instruments. The Certicom solution uses elliptic curve cryptography (ECC) to add item-level RFID tag security that protects product information and proves the legitimacy of products. Certicom uses standards-based and proven cryptographic protocols for its RFID appliance, enabling a high level of security to be added to the tag without requiring a lot of computing power and storage.
http://www.rfidupdate.com

Cardinal Health Reports on RFID Pilot
In other news at the NACDS RFID Healthcare Industry Adoption Summit Cardinal Health released results of an extensive pilot project designed to assess the suitability of using UHF RFID technology for pharmaceutical supply chain tracking and e-pedigrees. Cardinal, an $81 billion global provider of products and services to many segments of the healthcare industry, said it is encouraged by the pilot, but also noted the technology and industry are not ready for adoption.
"While our pilot demonstrated that using UHF RFID technology at the unit, case and pallet level is feasible for track-and-trace purposes, a great deal of additional work needs to be undertaken by stakeholders across the industry to address significant challenges including global standards, privacy concerns and the safe handling of biologics," said Renard Jackson, vice president and general manager of global packaging services for Cardinal Health. "Until those challenges are addressed, direct distribution of medicine continues to be the best near-term approach to maintain the highest levels of security and efficiency in the pharmaceutical supply chain."
Improving read rates is one of the challenges. Although Cardinal was encouraged by the item-level read rates it attained for several distribution center processes, a spokesperson said: "We feel that 99 percent is not enough. We need to be Six Sigma quality or greater because in the long term we'll be creating e-pedigrees from the data and we can't live with 1 percent errors."
However, the spokesperson added that overall Cardinal "is feeling good about the technology." Cardinal concluded that it is possible to do multiple forms of pharmaceutical tracking with UHF frequency. This is important to the industry because having one frequency for RFID systems costs less to support.
http://www.rfidupdate.com

Marks & Spencer to Expand RFID Use
UK retailer Marks & Spencer will extend its item-level RFID tagging deployment from 42 to 120 stores next spring. The company has tracked clothing with RFID in its distribution centers and in stores since 2003. The garment-tracking system will include "size-complex items such as suits, casuals and separates," said a Marks & Spencer (M&S) spokesperson. "By looking at size-complex items and improving the stock-taking process, we can improve product availability."
Marks & Spencer currently uses mobile readers on the shop floor and fixed-position readers at its loading bays and distribution centers to scan garment tags. The mobile scanners are used to take daily inventories and trigger replenishment orders. So far, the company has successfully improved stock accuracy and size availability. "Our clothing RFID work is a good example of how we are using new technology for increased business efficiency and customer service," said James Stafford, head of clothing RFID at M&S. "Stock accuracy has improved and the customers have commented on the more consistent availability of sizes."
http://www.rfidupdate.com

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What Won't Happen in 2006
ABI Research says that companies will continue to ramp up RFID capabilities in 2006 but internal infrastructure and external data synchronization issues will hinder solution deployments that span sites and trading partners. Generation 2 RFID tag shipments will fall below the 1bn mark, due in large part to bottlenecks on the demand side and not to an inability to produce. "There will be some companies demanding more Generation 2 product, but infrastructure limitations will keep industry demand below 1bn UHF Generation 2 units in 2006," ABI says.
The research firm also predicts "no clear winner" in the item-level tracking frequency debate in the coming year. Both UHF and HF will be used at the item level, it says. "The choice between frequencies will come down to application and cost. RFID pharmaceutical tracking will be the first widespread deployment of item-level RFID and that market has yet to decide on a frequency."
http://www.abiresearch.com