doc.: ieee 802.15-09-0200-00-004f submission march 2009 ian robertson, gs1 epcglobalslide 1 project:...

doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009

Ian Robertson, GS1 EPCglobalSlide 1

Project: IEEE P802.15 Working Group for Wireless Personal Area Networks (WPANs)Project: IEEE P802.15 Working Group for Wireless Personal Area Networks (WPANs)

Submission Title: [EPCglobal Raison d’Être ]Date Submitted: [10 March 2009]

Source: [Ian Robertson] Company [GS1 EPCglobal Inc.] Address [] E-Mail:[[email protected]]Re : []Abstract:[EPCglobal RFID Supply Chain and Operations Improvement]Purpose:[A look at why GS1’s EPCglobal standards enable supply chain & operations improvements]

Notice :This document has been prepared to assist the IEEE P802.15. It is offered as a basis for discussion and is not binding on the contributing individual(s) or organization(s). The material in this document is subject to change in form and content after further study. The contributor(s) reserve(s) the right to add, amend or withdraw material contained herein.Release:The contributor acknowledges and accepts that this contribution becomes the property of IEEE and may be made publicly available by P802.15.

doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009

Ian Robertson, GS1 EPCglobalSlide 2

EPCglobal Raison d’Être

A look at why GS1’s EPCglobal standards enable supply chain & operations improvements

V4 16th February 2009

©2008 GS1 EPCglobal

doc.: IEEE 802.15-09-0200-00-004f

Submission

A Different Perspective…..March 2009

Ian Robertson, GS1 EPCglobal3

Much attention has been given to explaining RFID technology and EPCglobal standards and how they enable the use of this technology in supply chains and retail operations.

But understanding the technology and the standards is not enough unless their use is put into the most important context of all – that of the business that is using them.

This presentation illustrates how they can help improve business from the perspective of an imaginary Vice President of Operations.

Although a fictional manufacturing operation is illustrated, the KPI’s and benefits are common to most operations


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


It’s The Only Reason For Doing It

There are many ways to do this and many parties may be impacted, but ultimately this is why a member will embark upon implementing our standards and keys.

To gain business benefit


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


It’s The Only Reason For Doing It

There are some basic and natural groupings for how those benefits are realised

They will be familiar to operations executives !



doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Efficient Use Of Capital

• Maximise use of Property, Plant & Equipment

• Minimise inventory levels

• Maximum speed of inventory through supply chain

• Minimise inventory obsolescence & write off

• Minimise Accounts Receivables


doc.: IEEE 802.15-09-0200-00-004f

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March 2009


Operational Efficiency

• Minimise process duration

• Minimise process steps

• Minimise process delays & interruptions

• Minimise down time

• Make right first time

• Deliver right first time


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Customer Focus

• Right product made & delivered on time

• Minimise Time To Market

• Provide key progress information

• Right price

• Right quality


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Operations “Layers”

5th March 2009

Level 1 is the management of an individual item, service or information through the operation’s processes. It focuses on individual processes and

transformation of material into the saleable item.1

Level 2 is the management of the operation on an overall and periodic basis rather than on an individual process. It uses data collected during the processes

to establish trends, monitor performance, identify bottlenecks etc.2

Level 3 is the management of the assets, property, plant, equipment, buildings and capital used. It also focuses on long term and strategic

planning. Accurate data is essential for this task.3


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Data “Layers”

5th March 2009

Level 1 data is information about the progress of an individual item, component or service through the company's operations.

Level 2 data is summary data that provides data ontrends, throughput, supplier and vendor performance etc. It is based upon aggregation of Level 1 data

Level 3 data is information about capacity utilisation, capital utilisation, ROE, customer & market requirements. It is based upon aggregation and

analysis of Level 2 data


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Operations Additional Focus

2006 EPCglobal Inc

In addition to managing the layers, Operations mangers have to manage two other very important aspects of their operations

Customer – provide the customer with information on order acceptance, order execution, dispatch, tracking and delivery

Processes – execute the minimum work necessary to transform the materials into saleable goods or services consistent with stated quality goals


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Managing An Item

• Where is this item in the process ?

• Is this item on schedule ?

• Has it gone through all planned processes ?

• Does someone need to intervene in the process ?

• Will this item meet customer schedule ?

• Does it have all planned components ?

• Has it passed all necessary tests ?

2006 EPCglobal Inc

Single Item

Associated Single Item


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Managing An Operation

• How was production last month against plan ?

• Where were my process bottlenecks ?

• What vendors performed to agreed SLA ?

• How did operations compare to each other ?

• How do we compare to others in our industry ?

• Did we meet commitment to our markets ?

• What supply issues impacted production ?

• Did we ship things on time ?

2006 EPCglobal Inc

Printer Factory

Line Performance Analysis


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Managing Fixed Assets

Can I delay facilities expansion and avoid non linear increase in fixed assets allocation ?

When will peak demand exceed available capacity ?

Are my facilities in the right place ?

Will supply chain flows continue to support our markets ?

Is my Landed Cost still competitive ?

Can I improve seasonal capacity planning ?

Do I need different types of facilities ?

2006 EPCglobal Inc

Property, Plant & Equipment

Inventory & Carrying Cost


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Current Assets – Pipeline Inventory

For many industries, this is a significant cost in the whole chain

If I can better see what is where in the pipeline I can better trust supply chain information

If I can ‘trust’ this information I can reduce my ‘buffer’ inventory and reinvest the capital

Knowing what is coming at production enables better production planning

Less inventory requires less space and less handling !

2006 EPCglobal Inc

Printer Engine $100

Quad Core CPU $677


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Managing Customer Service

Once they have ordered, customers want information

Is my product being made ?

Have you shipped it to me ?

Can you get it to me when I have requested it ?

Where is it now ?

When will it reach me ?

2006 EPCglobal Inc


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Managing Processes

What work can I eliminate ?

Are there any duplications ?

Are we doing work because of poor visibility ?

Where are my choke points ?

What work could be done in parallel >

How much effort do we spend going after item information ?

2006 EPCglobal Inc


doc.: IEEE 802.15-09-0200-00-004f

Submission

Managing Business BenefitsMarch 2009


Item Progress

Printer Factory

Process Performance

AnalysisProperty

Process Improvements

Improving operations can take many forms and involve many parts of the company as well as its suppliers and customers

Inventory & Carrying Cost

Plant & Equipment

Customer Information


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Interdependent Benefits

These benefits are often interdependent and even overlapping. The same improvement can provide multiple benefits

We can illustrate this by means of the “Benefits Matrix


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


The Benefits Matrix

Better Use Of Capital Reduce Costs

Time To Market

Reduce Obsolesence

Operations Efficiency

Customer Focus

Managing An Item X X X

Managing Operation X X X X X

Managing Assets X X

Managing Pipeline Inventory X X X X

Managing Customer Service X

Managing Processes X X X X X X


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Hidden Problems

But none of this matters at all if you can’t see what’s wrong in your operation. You can’t fix a problem that you don’t know you have!

The key to “seeing” your problems and opportunities for improvement is to “see” what has happened in your operation

And that requires “visibility” of what has happened.


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


A Shared Common Basis

2006 EPCglobal Inc

Visibility is not the goal of implementing GS1/EPCglobal standards and RFID technology. It is a means to an end, and that end is those business benefits.

But all of these improvement techniques are improved dramatically by accurate and timely visibility of what took place in the operations

VISIBILITY


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Elements Of Visibility

What something is

Where it was

When it was there

And it really helps too if I can know

Why it was there

What condition it was in

2006 EPCglobal Inc

But VISIBILITY is knowing..

This simple approach to collecting “event” data is the key to correctly identifying problems in operations, which is the key to improving operations!


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


How To Get Visibility

1. Have a way to identify an item

2. Have a way to capture that information

3. Have a way to exchange that information

4. Have a way to enquire about that information

2006 EPCglobal Inc

And to know those things you have to


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Did That Seem Familiar ?

2006 EPCglobal Inc

Shared Service Interactions

EPCglobal Core Servicesand other

Shared Services

EPCglobal Core Servicesand other

Shared Services

Co

mp

any

AC

om

pa

nyA

Exchange of Physical objects

with EPCs

Exchange of data about

EPCs

1010101010101

Co

mp

any

BC

om

pa

ny B

1. IDENTIFY

2. CAPTURE

3. EXCHANGE


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


But Why RFID ?

2006 EPCglobal Inc

This pallet has at least one “inner core”.

That means that there are cartons inside the pallet with no line of sight to their labels

Verifying all cartons present means you must

Drop the pallet

Break it down

Line up the label and scan the barcode on each carton

Rebuild and re-label the pallet

RFID can possibly read all labels as pallet passes the antennae without stopping at all


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


But Why RFID ?

2006 EPCglobal Inc

It is possible to do all of this using barcodes. We must remember that barcodes have served the world well for more than 30 years. But sometimes the time and effort required means that it is not viable to capture visibility data other than at critical points in the overall process.

The main advantage of RFID as a technology is that it enables the viable capture of identity and other data at many more points in the processes than was previously possible. And it can do that without interrupting the physical flow of items…

And barcodes can help by providing a secure backup to RFID. They even enable the implementation of RFID in stages across processes and trading partners.

VIABILITY


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


So Identify, Capture & Exchange…

2006 EPCglobal Inc

Identify Exchange

+

=

Capture

+


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Gives Us Visibility Of …..

2006 EPCglobal Inc

What, When, Where, Why & How

Identify Exchange

+

=

Capture

+


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Supporting Managing Benefits

2006 EPCglobal Inc

Process Improvements

Optimised Inventory

Pipeline Velocity

Customer Service

Asset Management

Trend Analysis

Vendor Performance

=What, When, Where, Why & How

Identify Exchange

+

=

Capture

+


doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Which Explains Raison d’Être !

2006 EPCglobal Inc

This is why the GS1/EPCglobal standards are an excellent support in achieving supply chain improvement and optimisation………



doc.: IEEE 802.15-09-0200-00-004f

Submission

March 2009


Questions?

Ian Robertson

+1 832 283 1790

[email protected]

doc.: ieee 802.15-09-0200-00-004f submission march 2009 ian robertson, gs1 epcglobalslide 1 project:...

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