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DOD Redoubles Its Efforts to Lower Costs Via RFID

Paul Peters, the deputy assistant secretary of defense for supply chain integration, says his department is launching a second phase of RFID deployment, focused on reducing inventory and increasing efficiency.
By Claire Swedberg
Apr 15, 2010After a decade of conducting pilots to track the movements of supplies using active and passive radio frequency identification tags across multiple agencies, the U.S. Department of Defense (DOD) is entering phase two of its RFID deployment, with an eye toward adopting end-to-end solutions, according to Paul Peters, the deputy assistant secretary of defense for supply chain integration. These end-to-end solutions would allow greater visibility across the DOD's supply chain, thereby reducing the risk of errors, enhancing safety and security, and lowering expenses through reductions in inventory and improved utilization of labor devoted to tracking items at each point along that supply chain.

That second phase will involve the use of RFID data integrated with the DOD's existing enterprise resource planning (ERP) software, as well as certain legacy systems, providing the DOD with insight into business processes, and thus identifying areas in which efficiencies might be improved.

Paul Peters, the DOD's deputy assistant secretary of defense for supply chain integration
Peters assumed his current position in January 2010, having previously served in key positions with the DOD's Defense Logistic Agency (DLA) as the deputy director for logistics operations and readiness, deputy commander of the defense distribution command, director of the defense reutilization and marketing service, and business system modernization program manager. In these positions, he oversaw the delivery of a range of forward and reverse logistics services provided to combatant commands, military services, and other federal and state agencies around the world. He described the DOD's new vision for phase two during his keynote address at RFID Journal LIVE! 2011, held this week in Orlando, Fla., as well as during an interview conducted with RFID Journal.

Over the past decade, Peters told conference attendees, his department has observed the success of multiple RFID pilots. "We're very interested in their success and the insight it provides us," he stated.

A reduction in federal budgets, Peters noted, will serve to encourage RFID adoption rather than inhibit it. The DOD's logistics services cost $215 billion in fiscal year 2010, accounting for 30 percent of the DOD's total budget, he added, and reducing costs in that area could thus provide a positive impact on spending. "With the demonstration of the business value of RFID," he said, "I view this [budgetary constraints on the DOD] as an opportunity for the RFID industry."

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