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Marching to Compliance and ROI

IT products provider GTSI was one of the first Defense Department suppliers to meet the military's tagging requirements. Now it's searching for ways to get a return on its investment.
By Bob Violino
Here's how the system works: As cases and pallets move on conveyer lines through the distribution center, workers scan the bar code labels on those cases and pallets to identify which cases and pallets need RFID labels. The bar code numbers of the scanned cases and pallets are fed into the Sun Database/Application server, where order information is stored. For a case or pallet requiring tagging, the Zebra encoder writes the appropriate identification number to a label's embedded RFID tag, and the operator manually applies the label to the case or pallet. The tagged pieces are then moved through the appropriate RFID portal, where the tag's readability and identification number is verified. Shipments also pass through the RFID portal just before the shipments leave the center, Decker says, to verify that the case and pallet tags can be successfully read and that the data on the tags is accurate.

Decker says GTSI is using the DOD's numbering system, which consists of unique serial numbers. The numbering system is the DOD 64-bit data construct. It consists of a header, filter (to identify the tagged object as case, pallet or UID), cage code and sequentially assigned serial number. The Sun RFID middleware application manages the assigning of these numbers to items. The bar code scanners used for this application are the same ones used by the floor personnel. The Sun middleware is Web-based and is accessed using Internet Explorer on the handheld bar code scanner.

GTSI was able to deploy its RFID system without disrupting operations, according to Decker, and that has helped keep costs down. Decker declines to say how much the entire RFID system has cost his company. Cost issues have been a concern for many of the organizations considering deploying RFID technology, including suppliers to the DOD. Analysts have said the challenge will likely be greatest for smaller suppliers that don't have the budgets for RFID implementations.

Some DOD suppliers may still not be fully aware of the RFID requirements. To get the word out, the department has launched an extensive outreach program that includes presentations at industry conferences working with associations to help smaller businesses learn about RFID technology. The DOD posts a list of upcoming conferences on its RFID site at www.dodrfid.org.

Future Payoff?
Having successfully met the first phase of the DOD's mandate, GTSI is confident that it will meet the department's future RFID requirements to tag shipments to other DOD locations that will deploy RFID systems. Therefore, the company is focusing on how it can best take advantage of the technology it has installed to improve internal operations.

What will be the payoffs for GTSI from using RFID, other than being compliant with one of its largest customers? "That's the $64,000 question," Decker says. "Gaining the return on investment on RFID technology is always a hot topic of conversation at any of the seminars or forums we're been to. How do you [use] this technology to gain efficiencies in your operations? It's something we'll be taking a very hard look at in the next year. We recognize that there should be a lot of benefit in expanding [RFID] within our operations."

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