Dec 22, 2005NCR a Dayton, Ohio, business equipment and services provider that also sells RFID products and services, says it will begin putting its tags where its mouth is by applying RFID tags to its own products and tracking them through its supply chain. The company plans to begin carrying out this policy in the first quarter of 2006, starting with products it makes for retail point-of-sale (POS) systems. The company is making the move to improve its own supply chain management, asset tracking and device maintenance processes. NCR first announced plans to tag its own products earlier this year, at the RFID Journal LIVE! Europe conference, where it also said it would begin selling RFID products and services to European firms (see NCR Extends Its RFID Initiative).
John Greaves, NCR's vice president of RFID solutions, says the first NCR systems to be tagged will include the company's kiosks and FastLane self-service check-out systems. NCR’s kiosk products, such as the NCR 7401, can be deployed in retail stores to enable consumers to inquire about product details or shop for items not on display. The FastLane systems let consumers ring up their own purchases by scanning product bar code labels or RFID tags.
Initially, Greaves explains, NCR will tag its POS equipment with its own UHF EPC Gen 2 Class 1 tags, but going forward, the firm will likely use tags with other operating frequencies and other protocols for equipment in different industries, such as retail banking. In January, NCR will begin attaching what Greaves calls "master tags" to the units. Encoded to these tags will be an ID that will correlate, through an NCR database, with product data about the POS unit. Such information will include an NCR model number, purchase order information and the address of the retail location where the device will be installed, as well as the lane number within the store where it is to be installed. This data will be initially helpful to NCR's team of installation engineers, who install the systems inside retail locations.
Once deployed, the unit's service and maintenance history will also be associated with the master tag. Details relating to the components built into the unit, such as their manufacturer and a product identifier, will also be associated with that unit's master tag ID in the NCR database, but the parts themselves will not initially be tagged.
In 2006, once NCR's suppliers begin attaching RFID tags to the parts used in the POS units, the parts’ tag IDs will be associated with the master tag data in the NCR system. Greaves says that during routine service visits, NCR technicians will also be applying master tags to POS units already installed within retail locations. Each product's component data and maintenance history will then be accessable via this tag ID.
NCR will require its parts suppliers to tag system components before shipping them to its customer fulfillment center in Peachtree, Georgia, where the firm builds point-of-sale systems to customer specifications. Greaves is quick to point out, however, that the transition to tagged parts will not happen over night. "It takes time," he maintains. "We will have some component manufacturers up to speed quite quickly." Others, especially those whose components might be too small to tag easily, will need more time to find tags that will work.
In most cases, Greaves says, NCR will reimburse its suppliers for some of the cost of tagging their parts. His firm will also transfer some of its RFID costs, which he describes as "pennies per tag on equipment that costs thousands of dollars," to its customers. "We'll explain [to our customers and suppliers] the benefits of the tagged systems," Greaves says, adding that too much emphasis is put on the cost of RFID equipment and not enough on the business benefits the technology enables. "To date, the vision of ROI [with RFID] has been seen as the five-cent tag, rather than the pursuit of better business processes."
For NCR’s parts suppliers, these benefits include faster payment, enabled by faster and more accurate inbound receiving by NCR. According to Greaves, for retailers buying NCR equipment, using the RFID system would result in less time spent tracking down paper-based maintenance histories of the units and their components, which they might need to provide a technician during a service call. Additionally, retailers could use the RFID tags to automate how they take inventory of their assets, which could help with Sarbanes-Oxley compliance.
After this initial push in its retail systems division, NCR plans to expand the tagging program to track other products across its other business units, including its retail banking equipment division, through which it sells and services ATM machines. During routine inspections, NCR technicians could access information about these ATM machines and their internal components by reading RFID tags attached to them. Because they would not necessarily need to open the machines to complete service visits, this could lower the risk of technicians being harmed by someone attempting to steal the contents of an ATM.
