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RFID Is the Alaska Gas Pipeline's Strongest Link

A construction project this huge, and in such a hostile environment, faces some unique challenges, which RFID can help address.
By Oliver Hedgepeth Sr., Morgan Henrie and Oliver Hedgepeth Jr.
Storage areas and warehouses will be minimal, if available at all, so the pipeline project must be carried out in a way similar to the just-in-time process for today's manufacturing operations. In an effort to minimize supply-chain costs and shrinkage, the project must have the materials on site when the construction crews require them. Conversely, failing to have the material on hand will delay efforts and result in significant cost increases. The logistics manager will have to work with the project manager to decide when materials are delivered to construction sites, which will usually be remotely located. An essential key to moving the right material to the correct location at the optimum time is knowing what material is where in the overall supply chain—enter inventory management and tracking.

With millions of tons of freight and millions of pieces of equipment required, the use of RFID tags offers the possibility of limiting waste, the loss of materials, expensive rush replacement orders and duplicate orders, while enhancing safety and security for the pipeline system and for the people working within the project. RFID-generated data will become a key contributor to Six Sigma initiatives to minimize defects with logistics-management and project-management systems, methods and processes.

Morgan Henrie
One of Six Sigma's key metrics for Alaska Gas Pipeline could be the ability to trace and track the movement of material from receipt into the supply chain to final site installation. Tracking the various assets from receipt to installation would allow the project-management team to see in near real time the growth of the pipeline and the location of inventory. The project-management team would be able to monitor the overall system for bottlenecks occurring due to a lack of proper materials at the correct location, and other complications. They could also monitor construction processes in near real time as the material is installed and logged into location. Furthermore, the RFID tags would provide a means to correlate where a piece of material has been installed for later recall on an as-needed basis. And yet, this increased visibility will come with a new set of issues: data management.

The Trans-Alaska crude-oil pipeline relied on first-hand receipt and transportation inspections that required valuable time to process the data. The use of RFID on the new gas pipeline, on the other hand, would change that process by automating the data transfer process and eliminating or minimizing many delays that a manual system currently causes. RFID, however, can generate a new RFID-based Six Sigma issue of how to manage the database with millions of pieces of streaming data radiating from potentially all material items. The vast quantity of information will need to be managed.

The Trans-Alaska Pipeline heavily relied on experienced and capable project managers, engineers, warehouse personnel and transportation crews, as well as a host of support personnel. The new Alaska Gas Pipeline will need not only need the same types of resources, but also logistics managers and supply-chain management expertise. Without superior logistics management and processes, the pipeline project will incur additional cost and time for what is already a very expensive undertaking. Therefore, Alaska Gas Pipeline planners must consider the use of RFID technology as an essential key link in managing the unknown unknowns of this vast and complex project.

Oliver Hedgepeth Sr. is the chairman of the logistics department at the University of Alaska Anchorage (UAA) and author of RFID Metrics. Morgan Henrie is a research professor in RFID and logistics at UAA. Oliver Hedgepeth Jr. is a Six Sigma quality-control and project-management expert at Genworth Financial. The authors welcome comments and research collaboration as they continue their search for identifying the future problems of the Alaska Gas Pipeline project, with RFID as a key link to the project's success.

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