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SAP Takes RFID into the Enterprise

The enterprise resource planning vendor's Auto-ID Infrastructure aims to help companies leverage RFID data. This Vendor Profile looks at SAP's strategy for using RFID to enhance supply chain applications.
By Bob Violino
Oct 11, 2003—By Bob Violino

Oct.13, 2003 - SAP, the world's largest enterprise resource planning (ERP) vendor, was the first major software company to sponsor the Auto-ID Center and the development of the Electronic Product Code (EPC). It has also done RFID research with Harvard University, Rutgers University, the Stanford Global Supply Chain Management Forum and M-Lab, a joint initiative of the Swiss Federal Institute of Technology Zurich (ETH Zurich) and HSG University of St. Gallen in cooperation with the Auto-ID Center. The German software giant clearly believes EPC will become a core part of the global supply chain. And it intends to take advantage of RFID technology to provide its customers with a much greater level of supply chain efficiency than was ever possible before.

"We view integrating EPC data into existing ERP systems as absolutely critical," says Raymond Blanchard, SAP's business development director for auto-ID solutions for manufacturing. "Our strategy is to provide a complete Auto-ID solution that allows customers to communicate transactions from RFID readers to SAP and non-SAP applications."

SAP's Blanchard

SAP’s goal is to be a leader in what it sees as an emerging market for systems that create "real-world aware" supply networks that can quickly adapt to changes in the marketplace. RFID products will be key components in the 21st-century business model that SAP calls the Adaptive Business Network. "Auto-ID enables the truly adaptive business," Blanchard says. "Unless you actually know where goods are and where they've been, you're just guessing. This takes all the guesswork out of it. Business managers will know where goods are in the back room of a retailer and where supplies are in a factory. This isn't just a demand-side benefit; it affects the whole supply chain."

Blanchard declines to give specific launch dates for SAP products. But he says the company will roll out software applications supporting RFID within the next year. At the heart of SAP's RFID strategy is a networked software platform called Auto-ID Infrastructure (AII). Developed over the past two years by SAP corporate research in conjunction with several of the company's product and industry teams, AII will collect, analyze and manage high volumes of real-time information from tagged items, environmental sensors, global positioning systems and wireless data.

The Auto-ID Infrastructure will be integrated with SAP and non-SAP supply chain applications. The company will not make an announcement about the availability of the platform until it's complete, which will depend, in part, on industry developments, including the formalization of standards. "The EPC standard is not final yet; the software interfaces are not final yet," says Blanchard. "I think we will know a lot of the answers [about standards] over the next couple of months or so."
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