Hong Kong energy-saving lightbulb manufacturer Neonlite Electronic & Lighting (maker of Megaman products distributed in more than 80 countries worldwide) is employing radio frequency identification and its own enterprise resource planning (ERP) system to manage product manufacturing, inventory and shipment at one of its four manufacturing plants. The system—installed in January 2009 at its plant in Xiamen, China, and provided by software company Infor—utilizes RFID hardware from Intermec Technologies to track work-in-progress as trays of parts used to make the lamps move through the assembly line. GlobeRanger provided software for the deployment.
“Over the years, Neonlite has developed a wide range of energy-saving lighting products to meet different customer needs,” says David Fan, the company’s senior group IT and systems operations manager, “as well as play a part in keeping the environment green.” Neonlite, he notes, is one of the fastest-growing firms in the lighting market. As business has expanded, so too has the manufacturing facility. To target all of this growth, Fan says, Neonlite decided to create a single, integrated management system through which it could gain visibility into inbound logistics, parts management and work-in-process.
“While most RFID applications are used for supply chain or finished goods,” Fan explains, “Neonlite uses RFID within the entire production environment to improve the production material traceability and real-time inventory.”
Neonlite had already been utilizing Infor’s ERP Syteline warehouse management software to manage inbound parts and their consumption on the manufacturing floor. The new RFID system provides the company with greater visibility of its existing system, and extends that visibility through the manufacturing process by tagging trays—used to carry and assemble parts and finished products—and by tracking the trays’ movement around the plant and warehouse. Prior to the RFID system’s deployment, employees filled out transaction slips when parts were received or products were shipped, then entered that data into the ERP system.
With the RFID system, parts are loaded onto trays fitted with Intermec passive EPC Gen 2 RFID tags operating at 900 MHz. To indicate a tray has been filled and is ready to be taken to an assembly station, a worker uses an Intermec handheld RFID interrogator to read the tray’s tags. Each tag is then read once more as the tray passes an RFID portal (containing an Intermec IF5 fixed reader) on its way to the manufacturing floor, or into the warehouse for storage. The portal includes a motion detector that prompts the interrogator when a tagged tray approaches, at which time the reader begins interrogating the tag.
As the tagged tray of parts passes from one work-in-progress phase to the next (often at a separate workstation), its tag is read via a handheld interrogator to update its status. Management can use the Infor SCM Warehouse Management software, integrated into the firm’s ERP system, to view the tray’s exact location and determine how long it has been there. Once assembly is complete, the finished lightbulbs are packed in tagged cartons and loaded on tagged pallets. The items then pass RFID portals several more times before shipment.
“Infor SCM Warehouse Management and Infor SCM RFID play a pivotal role in Neonlite’s inbound logistics operations,” Fan states. The former enables the company to manage parts as they are moved into the warehouse or sent to another location, as well as when they are shipped from suppliers. Infor SCM RFID interprets the readers’ data to enable Neonlite to locate and manage parts and product inventory on the manufacturing floor. The system improves production capacity by 15 to 20 percent, Fan estimates, by ensuring the right material is available at the correct location when needed.
With the SCM software, managers can determine how long it took for the parts to be consumed, and when additional items need to be ordered, as well as how much time the work-in-progress stage required, how long the finished lamps remained in storage before being shipped, and at what time they were shipped. GlobeRanger’s iMotion software platform was used to develop and test the RFID portals’ business processes, including the integration of motion sensors with the Intermec readers.
The GlobeRanger software sends alerts (exception reports) that notify management via e-mail or by mobile phone if trays filled with work-in-progress are moved past the incorrect portal or at the wrong time, if too many or too few tray tags have passed a portal at a specific time, or if a tray’s tag is not read at all. Additionally, the iMotion software will generate alerts if cartons are missing tags or—by matching the ID number of each carton tag with that of the pallet’s tag—if the incorrect tagged cartons are loaded on a pallet.
Installing the RFID solution took place in a number of stages, Fan says. First, Neonlite, Infor and GlobeRanger spent four weeks completing the conceptual design, during which it assessed Neonlite’s needs, and how the technology could address them. The group examined the physical containers (pallets and trays) and determined how they could best be tagged, and it also studied the physical environment and flow of material and products on the manufacturing floor. The team decided that tagging work-in-progress trays that carry parts through the assembly process, as well as tagging cases and pallets, would allow the company to manage both production and logistics.
For the next four weeks, the group developed and tested a prototype system. The companies installed a temporary portal, and users walked RFID tags through the process in order to test read rates. After that, Fan says, they began a two-week “details design phase,” drawing out the details of the installation, based on the prototype, including portal specifications, handhelds and database design. The following four weeks were dedicated to developing, building and testing the entire RFID system, then installing it and going live—a process that took another 12 weeks.
“The system is still under partial deployment,” Fan states, “to allow any minor adjustments before full-scale deployment.” Neonlite also plans to install the system at its three other plants, though it has yet to determine a deployment date. In the meantime, Fan says he hopes to see a positive return on his company’s investment in approximately two years.