Reflections From RFID Leaders

By Admin

End users, researchers and providers share their insights and perspective.

Apr. 1, 2012

Coming Together for a Common Goal

By Kevin Ashton

I nearly didn't go to the meeting in April 1999 that led to the founding of the Auto-ID Center. A colleague at Procter & Gamble asked me to sit in for him at an event hosted by MIT's department of architecture, in Cambridge, Mass., and I reluctantly agreed. The topic was homes of the future, and one of the presenters was David Brock. Sanjay Sarma, his colleague, added comments from the back of the room. At the time, I was on a mission to put RFID tags on every product P&G made. I had been a brand manager working on Oil of Olay, and had struggled to keep our products in stock on store shelves. I happened across RFID in credit cards in 1998, and thought it could solve our problem. I wondered if there was a way to make the tags cheaper by having them point to information on the Internet. David talked about using RFID tags as a way for a robot arm to learn about objects in its environment, and suggested the data should be stored not on the tag but on the network. This was the first time I had heard anybody else say this.

The next day, I met with Sanjay, and we frenetically exchanged ideas across a white board in his office. Things happened quickly after that. In the space of a few months, Alan Haberman, of the Uniform Code Council (UCC), suggested we set up a research center and agreed to sponsor it, I persuaded P&G and Gillette to join, and P&G relocated me to MIT to become the center's executive director. The Auto-ID Center was announced at the Smithsonian Institution at the end of September 1999, and opened officially on Oct. 1.

Things were basic at first. My office was a converted stationery closet with no windows, and I had to unplug a shared fax machine to get online and collect my e-mail. For the first three months, my desk consisted of the boxes in which I had shipped my belongings. And we had only three sponsors. That changed gradually during 2000, as CHEP, International Paper, Philip Morris and others joined us. By the end of that year, we had made enough progress to plan a field test, which started on Oct. 1, 2001, when the first EPC-tagged products—pallets of Bounty paper towels—were received at a Sam's Club in Tulsa, Okla. Every few months, we gained more support, as existing sponsors introduced new companies and word of our progress spread. In an effort to make our RFID system global, we shared the money we were raising with other universities around the world, and opened centers in Australia, China, Japan, Switzerland and the United Kingdom. This brought in more international sponsors, until most of the world was represented at the center's ever-expanding sponsor meetings.

These sponsor meetings became huge affairs, almost like conferences, and culminated in representatives of some 103 companies joining us for our final sponsor meeting in a skyscraper high above Tokyo, in September 2003. Other meetings had taken place in Atlanta; Santa Clara, Calif.; Celebration, Fla.; Zurich; and Cambridge, England, as well as many at MIT. We closed the center's doors on Sept. 30, 2003, and handed off responsibility for our Electronic Product Code technology to EPCglobal, a new, nonprofit standards body operated by GS1, global successor to the UCC. The centers at each university became the Auto-ID Labs, dedicated to continued research into RFID and its applications.

Looking back, it feels like we accomplished a lot in those four years, but at the time, we couldn't go fast enough, and all our progress seemed difficult and hard won. There were battles over standards, tag prices, system decisions, privacy and patents. Many people outside the center openly expressed skepticism that we, or our technology, would ever amount to anything much.

In every case, the community that the center had become was able to find pragmatic, consensus-based solutions to even the toughest challenges—a real testament to the power of what people can accomplish when they trust one another's intentions and work toward a common goal. There were too many people involved to mention everyone, and to mention anyone risks leaving someone out, but anybody who ever attended an Auto-ID Center meeting, helped write an Auto-ID Center research paper, authored an Auto-ID Center standard or contributed to an Auto-ID Center prototype has my deep and abiding gratitude. Together, these hundreds of people from all over the world joined as one and worked passionately and tirelessly to do things many thought could not be done, achieving remarkable results by refusing to believe in the impossible and choosing instead to believe in each other, themselves and the future. At some unmarked moment, sometime between 1999 and 2003, this brilliant and disparate group of people took their mission past the tipping point and reached critical mass, at which point the crazy ones were no longer those on the inside who believed it was possible, but those on the outside who believed it wasn't.

Kevin Ashton was cofounder and executive director of the Auto-ID Center.

Reckless Predictions

By Sanjay Sarma

David Brock and I began our RFID research in 1998 with a simple thought: Why not strip all the functionality off the RFID chip, reducing it to an inexpensive speck of silicon, and push all the functionality onto the Internet? I was confident that smart engineers would be able to invent new ways to make the tag "throw-away" cheap. I remember proclaiming that a 10-cent tag was possible. A couple of years later, we wrote a paper explaining that an RFID tag would cost 5 cents when manufactured in high volumes. If our reckless predictions came true, we'd know the supply chain was a target.

In 1999, I met Kevin Ashton, who gave us the killer app: stock availability. To this day, shelf availability remains the number-one application of the Electronic Product Code, and it was with that thought that we launched the Auto-ID Center at the Massachusetts Institute of Technology. Kevin's crystal-clear articulation of the value proposition of inexpensive, ubiquitous, standardized RFID made the vision go "viral" before people knew what going viral was.

SanJay Sarma, right, with Mark Robert, accepting his special achievment award at RFID Journal LIVE! 2010.

That same year, Dave, Kevin and I met Alan Haberman, founder of the Uniform Code Council, who would become an irrepressible force behind the Auto-ID Center. The bar code was 25 years old in 1999, and it was time, Al told us, to look for its successor. He pledged the council's support and remained deeply involved until he passed away last year.

Later that year, we won the support of Gillette, Procter & Gamble and Wal-Mart, and our mission was off the ground. Dick Cantwell, then a VP at Gillette, became the chairman of our Sponsor Board, and remains a beacon for end users. Two events—Gillette's announcement in 2002 to buy half a billion RFID tags from Alien Technology, and Wal-Mart's tagging mandate in 2003—started commercial RFID off on its roller-coaster ride.

Every aspect of our vision was tested by fire. Yet, our coalition of founders and technical and industrial supporters remained committed and strong. Our first hurdle was justifying our dependence on that thing called the Internet. Although the Internet was a couple of decades old, people were barely coming to grips with its potential. "This phone will become an Internet router," I would proclaim to skeptical audiences. In the end, the Internet made EPC cheap, because it fulfilled its promise of ubiquity. The lesson for me is simple: In technology, as in ice hockey, it is important to skate to where the puck is going to be. That takes a combination of vision and risk-taking. No risk, no glory.

The second battle was around the air interface. We struggled to get the established RFID industry to play ball in the early days. The existing protocols were bloated, mired in intellectual property and expensive to manufacture, and they performed poorly. A number of startup companies—always a key part of America's unstoppable innovation engine—came to our rescue. Alien stepped up to help develop the Gen 1 Class 1 standard. Matrics contributed its own protocol, which we absorbed as Class 0. The two protocols were incompatible, but did not interfere with each other. Converging the two protocols was a controversial but pivotal compromise, because it avoided a divisive standards battle. ThingMagic developed a multiband reader, showing that readers could work with multiple protocols and be cheaper than those on the market. Alien also introduced the prospect of low-cost manufacturing with its fluidic self-assembly. (Sadly, RFID inlays are still manufactured rather conventionally; an opportunity exists to extract further cost savings with innovative manufacturing.)

The next battle was around software. Large incumbent players were convinced existing technology would be sufficient to handle RFID. We disagreed. RFID, we felt, would usher in a new era of event streams that would need to be buffered, digested and "reacted to" (as opposed to simply stored). We proposed a set of "event routers," which eventually led to the development of entirely new approaches for handling and filtering events, and services for accessing EPC-related information.

There were numerous other obstacles in our journey, each worthy of an entire chapter on its own: the launch of EPCglobal, development of Gen 2, questions about privacy, development of an IP policy, contribution of IP, development of software standards, development of business cases, passage of the ISO 18000-6C standard and so on. The point is, technology development is very much like the Tour de France—a marathon, not a quick sprint.

The Auto-ID Center and its successor, EPCglobal, have benefitted from the commitment of many remarkable contributors, including: Curt Carrender, Chris Diorio, Loek d'Hont, Matt Reynolds, Steve Smith and Roger Stewart on the hardware side; Bruce Delagi, Richard Swan and Ken Traub on the software side; and Bernie Hogan, Sue Hutchinson and Gay Whitney on standards. Only some of these folks remain involved today, and while many excellent new colleagues have joined the fold, I worry that the industry has started taking EPC for granted.

Much work remains to be done—new industries (such as automotive) to conquer, new challenges (better locationing, for example) to overcome and new technologies (NFC, for instance) with which to coexist. It will take enthusiastic, spirited thinking and debate combined with visionary business leadership to ensure the use of EPC grows in the years and decades ahead. But today, the industry is back on the upswing with better technology, tighter business cases and a clearer mission.

Sanjay Sarma is a professor of engineering at the Massachusetts Institute of Technology and a cofounder of the Auto-ID Lab at MIT.

Surprises Along the Way

By Prasad Putta

Some of my expectations for RFID have been met, though not exactly as I'd anticipated. In the beginning, I had a bias for passive RFID and the Electronic Product Code, because that's the technology I worked on with Sanjay Sarma at the Auto-ID Center. I thought we could solve every business problem with passive RFID. Now, one thing is obvious from 10 years of working with customers: Manufacturers will use a multitude of technologies—passive, active and location—to solve a broad spectrum of problems. What's important, though, is that they have a common architecture across the enterprise. Then, it doesn't matter what's under the hood.

The retail vision was item-level all the time. But I, like most people involved, thought consumer product goods retailers would lead the way, since they were the original sponsors of the Auto-ID Center. CPG companies wanted to make sure they had the right products on the shelves and improve promotion execution. As it turns out, apparel retailers have been the first to adopt item-level tracking, and certainly many other retail segments will follow.

Issues that may have held apparel retailers back before—the complexity of applying tags to merchandise, tag costs, stray reads and so on—have been addressed. RFID's value proposition for improving shelf availability and increasing sales through improved inventory visibility and loss prevention practices is clear. Within three to five years, we'll see apparel retailers adopting RFID beyond these applications. They'll be fulfilling another vision—improving the customer experience. For example, smartphones will be able to read the EPC tags on products, so shoppers can access information and share it with their friends. It'll be exciting to see what develops.

The RFID industry has experienced a lot of false starts, but it's now on very solid footing. I'm glad enough vendors survived to continue to develop good technology, which is necessary to collectively move forward. Rollouts are following pilots. We're in a good place now, for vendors and customers.

Prasad Putta is cofounder, executive VP and general manager of merchandise visibility and RFID at OATSystems, a division of Checkpoint Systems.

Business Radar

By Carlo K. Nizam

At Airbus, we focus on value-chain visibility, and RFID is a big part of achieving that visibility. Our goal is to use auto-ID technologies to create a "business radar" to help us see what is happening across our operations, so we can optimize the way we work, improve the efficiency and quality of our processes, and make the right decisions faster.

Airbus' first RFID project took place in 1999, and when I started to dabble in the technology, in 2005, there was a lot of interest in it. At the time, I was head of supply-chain operations and improvement. More than half the inventory I managed was outside Airbus' four walls, and it was all being tracked on paper, with people faxing in information from remote sites. As part of my Six Sigma efforts, I wanted a radar system that could track all inventory automatically. So I started to investigate RFID and reached out to other people in the company who were working with the technology, to see if I could avoid reinventing the wheel.

Carlo Nizam speaking at RFID Journal LIVE! 2011.

At about the same time, the company was in the full throes of a process-and-systems transformation program called Airbus Resource Planning (ARP), led by Cornelius Bronder. Until 2001, Airbus had been a consortium of four separate companies, each with its own processes and information systems. The goal of ARP was to develop single ways of working, supported by a harmonized information-system backbone, across the recently integrated company.

Bronder (who later became my boss) got wind of my interest in RFID. As RFID is all about process improvement, he wanted to make sure that, in addition to providing real business value, any RFID project would develop processes that could be standardized across the company and be based on a standard solution platform. In short, he didn't want to end up with multiple RFID processes and software platforms that were incompatible.

This led to the creation of an auto-ID company-wide program to increase the visibility across the aircraft life cycle. And so the value-chain visibility program was born.

The first ultrahigh-frequency RFID project I worked on was one of the most complicated to date, because there was a 0.5-watt restriction in France, and first-generation readers, tags and software were far from what they are today. Nevertheless, we managed to integrate the solution with our SAP system, convinced our suppliers to tag shipments to one of our warehouses, and installed fixed portal readers to perform automated goods receipt and inspection. It wasn't sexy, but it worked—we reduced the physical handling cycle time by 75 percent and improved inventory accuracy by 15 percent.

The project's success didn't immediately translate into broad support for RFID. We had to build a business case for each new process and application. We didn't try to force processes onto the business units; instead, we took the approach that we would support a business unit that saw a potential benefit from using RFID within a specific process and application. After several projects proved successful, word of RFID's potential started to spread throughout the company.

Today, we have a standardized deployment model, a standardized portfolio of RFID processes and standardized return-on-investment calculators for each RFID process, all built on standard hardware and software. In effect, we have defined and cataloged the life cycle of processes across the life cycle of a manufactured product. So, for example, when people want to use a tooling process, they can enter their existing operational data without RFID and know precisely what the benefit will be with RFID, because the process has already been tried, tested and implemented.

Our approach ensures each application delivers a real benefit to the company, uses standardized technology and employs business processes that can work at Airbus facilities worldwide—as well as within our suppliers' or customers' operations, if they want to use these applications, as some already have chosen to do.

Consolidating and standardizing our approach to RFID applications has helped us rapidly build an enterprise-wide RFID infra­structure, using both passive and active systems, to create a business radar for many aspects of our operations. What's more, it's helping create the more unified business processes and information systems the company made a strategic priority in 2005 through ARP.

Carlo K. Nizam is head of value-chain visibility and RFID at Airbus.

A Chance Encounter

By Carolyn Ricci

I fell into RFID by chance in the late '90s, when the technology was still in its infancy. I was a product development chemist at Moore Business Forms, and was assigned a project by members of the executive team. They said RFID had significant growth potential and told me to "go explore it." At that point, I did not understand what RFID stood for, much less what it could do and what impact it would have on our world.

There were only a few players in the RFID field at the time, so it was exciting to work together to understand and define the uses for the technology. Remember, there weren't even standards back then. When I left Moore for a career change, I always kept up with the evolution of RFID. I guess you could say the technology had gotten into my blood. So after being away from the industry for several years, I was very happy to get back into RFID at Zebra Technologies.

I'm glad to be involved in RFID, as adoption swells and the technology moves from proof-of-concept to real-world applications. Companies now realize RFID provides increased visibility and delivers real-time data, to help them make more strategic decisions. Leading adopters continue to evaluate RFID's return on investment—not only for the hard benefits but also the softer ones, such as improving the customer experience. I think this is a positive sign. This new look at ROI—along with continued education of the marketplace and a migration to more cohesive, scalable solutions—will drive adoption in the near future.

We've seen several innovative and creative implementations of the technology that I never could have imagined when I first began exploring RFID. It's thrilling to see how RFID is changing the nature of business.

Carolyn Ricci is senior product manager, RFID, at Zebra Technologies.

Shepherding a New Technology

By Dick Cantwell

In 2000, I was a VP at Gillette, in charge of global marketing. We had wonderful products and fabulous advertising and marketing plans. But I was never 100 percent sure of what I had on the shelf. We saw the opportunity to use RFID, an emerging technology, to gain supply-chain visibility, on-shelf visibility and better inventory management.

Alan Haberman, of the Uniform Code Council (UCC), was investigating next-generation product identification technologies. He was interested in forming a lab at MIT to explore how RFID could be used as a next-generation "electronic" bar code. Gillette, Procter & Gamble and UCC put up the initial funding to create the Auto-ID Center, which eventually grew to more than 100 sponsor companies. I sat on its board and eventually became chairman. It was here that the Electronic Product Code was born, thanks in large part to the vision and dedicated efforts of Kevin Ashton and Sanjay Sarma.

Dick Cantwell speaking at RFID Journal LIVE! 2006.

Gillette began by exploring RFID to reduce theft and shrinkage. As we trialed those use cases, we realized that when a product was not making it to the shelf, this was often not because it had been stolen, but because there had been breakdowns in the supply chain.

We hit a number of milestones early in our work. In 2003, we agreed to purchase up to half a billion EPC tags, which sent a signal to everyone that Gillette believed RFID was for real. We EPC-enabled one of our warehouses and built an RFID innovation center. Tracking at the unit level brought many challenges, because of the small size and low value of many consumer packaged goods, but our work showed how companies could extract value at the pallet and case level. That inspired more companies to get involved in RFID.

Around that time, P&G acquired Gillette, and I went on to lead the RFID efforts there. We discovered that one of the deepest opportunities for leveraging EPC was in promotions management. The company was launching the Gillette Fusion Razor, and we used EPC to track product displays to stores. That led to the concept of actionable visibility—using EPC technology and standards to see into your supply chain and take action to create business value.

Eventually, I moved on to Cisco Systems, where I helped sponsor a fixed-asset management application. It's been very gratifying to be involved in this highly successful program, because it uses EPC technology to track assets across the entire company.

During the past 12 years, I've learned a tremendous amount about business-enabling technologies and change management. Back in the day, we were starry-eyed about RFID's possibilities. But RFID adoption took longer than many of us expected. It takes time and effort to develop a robust and rugged solution that can deliver value across a community of users. It requires business process and change management. I don't think any of us realized how much is involved in changing a big company's culture. There also is a tendency to look at just one process to justify RFID and miss the synergies and return on investment that come with multiple applications.

Today, I am extremely bullish on RFID, especially using an EPC standards-based approach. Cisco is clearly demonstrating how business value can be mined from RFID. I have no doubt we will find other uses for our tagged assets, to enable the company to operate more efficiently. Some of our customers will want to use the tagged assets in their supply chains, and they, in turn, will encourage their customers to RFID-enable their supply chains. We'll see a coming together of use cases to create the end-to-end supply chain that was the vision at the start.

It's been a journey. It's taken leadership from a lot of people—too many to name—in the standards bodies, research organizations, end-user companies and technology providers to make it happen. I'm proud to have been part of it and had the opportunity to work with them.

Dick Cantwell is global VP of Cisco's Internet business solutions group and chairman of EPCglobal's board of governors.

A Funny Thing Happened on the Way to the Store

By Bill Hardgrave

In the early 2000s, everyone in the industry, whether they admit it now or not, believed RFID was a supply-chain tool meant for pallets and cases. I recall retail leaders at the time saying, "We will not see RFID on individual items in the store in my lifetime." (These people, incidentally, are still alive.)

The visibility provided in the early pilots, however, revealed something surprising—the greatest opportunity for RFID, in the near term, was not in the supply chain; rather, it was in the store. It was in the store that processes broke down, inventory was the most volatile and many perceived supply-chain issues originated (for example, poor forecasting and inventory management due to inventory inaccuracy). These early insights led to the switch in emphasis from tagging pallets and cases within the supply chain to tagging individual items in the store.

Bill Hardgrave in the RFID Research Center he founded at the University of Arkansas

Now, based on many successful pilots and deployments, we understand the benefits of RFID in the store—primarily, increased inventory accuracy, lower out-of-stocks, improved loss prevention and visibility into product location. For widespread adoption, though, tagging must occur at or near the point of manufacture. Thus, the technology is now being pushed up the supply chain—ironically, almost full-circle to where we started.

Looking back over the past 10 years, I don't think anyone could have predicted the industry would be where it is now or the path it has taken to get here.

Bill Hardgrave is the dean of Auburn University's College of Business, in Alabama. He was founder and director of the University of Arkansas' RFID Research Center.

Unforeseen Possibilities

By Paul Peters

Contrasting the state of RFID solutions 10 years ago with today's use of the technology is a startling reminder of how rapidly automatic-identification technology (AIT) has advanced. A decade ago, we were exploring a nonstandard, unproven passive RFID technology.

Now, there are deployments worldwide of passive RFID solutions, based on a global standard, to automate every aspect of supply-chain processes. Still, we are in the early stages of tapping the AIT foundation. It challenges us to consider yet unforeseen possibilities.

The U.S. Department of Defense (DOD) relies on multiple auto-ID technologies to address the specific needs of a wide range of business applications—including improving asset tracking, distribution center and warehouse operations, and inventory management—at home and in challenging environments overseas.

Active and passive RFID initiatives have progressed from isolated pilot programs that validated the technology to enterprise deployments focused on business process reengineering, integration of auto-ID data into enterprise systems, and assessment of return on investment to capitalize on the better business practices derivable from auto-ID capability.

These applications address our mandate to improve war-fighter readiness, while reducing our cost of operations. Going forward, AIT will remain a key enabler to increase competitiveness, boost productivity and drive informed decision-making. Our focus will remain on solutions that deliver enterprise-wide operational benefits, enabling enhanced support to the war fighter.

Paul Peters is deputy assistant secretary of defense for supply-chain integration at the U.S. Department of Defense.

Growing Pains

By Stephen Smith

I see positive signs of RFID gaining mass-market traction worldwide. RFID, for example, is being used in a more focused manner, and to track products of all kinds of value. China is using RFID to ensure against counterfeit brands of cigarettes, India is tracking the manufacture of new generic drugs and the United States is driving the worldwide retail supply chain. There is no denying the building momentum behind the technology.

However, in my view, author Clayton Christensen, who coined the term "disruptive technologies," was correct. He suggested that it takes time to advance and mature new technologies into new markets. Wi-Fi is a great example.

Wi-Fi existed for more than a decade before it was adopted en masse. RFID has experienced many of the same growing pains, including the lack of infrastructure and evolving standards. Together, these left potential customers sidelined while they waited for things to settle, and pushed out the mass adoption of RFID.

Fortunately, 10 years on, we now have a set of common and well-adopted standards, such as EPCglobal UHF Class 1 Generation 2. This, in turn, has created an environment in which RFID customers can set up a stable infrastructure, knowing their investments will not be obsolete within the return-on-investment period.

Looking forward, I believe a standards-based approach will continue to be important and provide stability to the industry. We will see additional hierarchies built on top of Class 1 Gen 2, to solve enterprise-level concerns and further expand the applicability of RFID.

This will be the decade of RFID.

Stephen Smith is the founder and chief technology officer of Alien Technology.