Gillette Sharpens Its Edge

Cantwell championed EPC technology internally at Gillette. In 2001, the company hired an outside consulting firm to assess the potential benefits of deploying EPC technology within Gillette’s supply chain. The consulting firm’s report indicated the return on investment would be huge. “Frankly, we were skeptical,” says Cantwell. “So in 2002, we did an internal assessment of the business case. We ratcheted down all of the projected benefits that our consulting partner came up with. We still came out with an attractive ROI.”


But there was no way to actually prove the business case, since no one had ever deployed EPC technology. The projected ROI was based solely on assumptions, and Cantwell and his team spent hours debating whether the assumptions were reasonable. “Our chairman [James Kilts] saw the potential and authorized a major pilot so we could test the technology and apply a rigorous process to evaluate its cost and value to the company,” Cantwell says.

The company set up a dedicated auto-ID department, headed by Cantwell. The team is made up of senior managers responsible for information technology systems, project management, customer development and the company’s European operations. This team works with executives in all operational areas of the company: IT, value chain, manufacturing, engineering—even corporate affairs, legal, finance, sales and marketing. The auto-ID department reports directly to the chairman’s operating committee.

In 2003, Gillette launched a major EPC trial at its packaging and distribution center for the northeastern United States. The facility is located in Fort Devens, Mass., about 45 minutes northwest of Boston. In an effort to validate the business case for using EPC technology and to develop a scalable solution, the company is tracking all cases and pallets of its female shaving systems within its center.

The goal of the pilot is not to see if tags on pallets and cases can be read automatically, but rather to develop the systems and business processes needed to sustain extraordinary levels of efficiency and productivity. In Cantwell’s words, Gillette wants to develop “a structured innovation process that provides organizations and individuals with the ability to produce results that are not predictable based on past experiences.”

To develop the infrastructure needed to leverage EPC technology, Gillette partnered with several technology companies, including Sun Microsystems and Provia Software. Sun was closely involved with the development of the EPC Network at the Auto-ID Center; the network enables companies to look up Electronic Product Codes on the Internet and find related information about products. Provia provided Gillette’s warehouse management and transportation management applications, but the applications needed to be upgraded to take advantage of the EPC data.

Gillette also worked closely with Alien Technology, a startup RFID technology company that provided the EPC tags, and with Tyco-Sensormatic, which supplied many of the readers. Another startup company called OATSystems provided some of the middleware needed to filter the RFID data coming from readers.

The vendors worked with Gillette to build an infrastructure that could be used not only within the Fort Devens facility, but could eventually be deployed across all of Gillette’s supply chain. “We’re not doing anything one-off,” says Cantwell. “We’re putting in an EPC architecture that we can scale to other warehouses, geographies and product lines. As we go, we’re mapping the process. We’re measuring and evaluating the effectiveness of the EPC Network.”