MICROSOFT
Microsoft and RFID
Radio Frequency Identification (RFID) is evolving as a major technology
enabler for tracking goods and assets around the world. It can help hospitals
locate expensive equipment more quickly to improve patient care, pharmaceutical
companies to reduce counterfeiting and logistics providers to improve the
management of moveable assets. It also promises to enable new efficiencies
in the supply chain by tracking goods from the point of manufacture through
to the retail point of sale (PoS).
As a result of the potential benefits of RFID, many of the world’s
major retailers have mandated RFID tagging for pallets and cases shipped
into their distribution centres by 2005. The consequences of this for the
retail sector is a likely impact on around 200,000 manufacturers and suppliers
globally, and will fuel the market for hardware and software to support
RFID.
But while the technology has received more than its fair share of media
coverage over the last 12 to 18 months, many are still unfamiliar with RFID
and the benefits it can offer. In fact, Microsoft-commissioned research
of the retail and manufacturing industries, from independent research consultancy
Benchmark, found that 31 per cent of senior decision makers in large UK
manufacturing companies have never heard of RFID. A further 24 per cent
may have heard of the term but know nothing about the technology beyond
the acronym. Indeed, only 26 per cent of those interviewed understood the
technology and its capabilities.
Despite projections for 2005 indicating that growth in the worldwide transponder
(RFID tag) market will be £464m*, lack of good information about RFID
and its benefits will potentially impede uptake of the technology. This
is illustrated by the Benchmark research, which found that 53 per cent of
respondents have not even considered deploying RFID and a further 21 per
cent have only vague plans. Only two per cent of companies use RFID tagging
extensively, showing how far the industry has to go. Furthermore, recent
IT in Retail research by Martec International has shown that 4% of the UK’s
leading retailers, including Comet, Iceland and Woolworths, have run RFID
trials but abandoned them with no plan to implement an RFID strategy in
the medium term.
RFID is still a growing trend though; across Europe, Carrefour, METRO and
a host of other organisations are already trialling RFID solutions. Manufacturers
such as Danish snack foods producer KiMS are also piloting the technology.
Research by RF & Microwave Industry News suggests that 41 per cent of
European retailers are planning RFID pilots for 2004.
This growth in uptake is being mirrored in the UK RFID market. Several major
manufacturers, logistics providers, retailers and other organisations are
already conducting trials. Some are also conducting phased roll out of the
technology.
One example is UK logistics provider TrenStar, which is already using RFID
to track reusable assets such as beer kegs. TrenStar tracks and manages
assets such as automotive roll cages, beer kegs, and air cargo containers
for its blue-chip customers. To achieve visibility of these items across
the extended supply chain, it developed an RFID-based container tracking
solution with full, web-based reporting. The solution was built on the Microsoft
.NET Framework, and also integrates with Microsoft Windows CE to power wireless,
handheld RFID scanners. While lost assets have traditionally been a major
challenge for manufacturers and logistics providers, TrenStar can now locate
each item in real time and report back to its enterprise customers quickly
and easily. As a result, goods can be transported more quickly, the capacity
of vehicles and storage space can be maximised and assets can be managed,
maintained, and replaced when necessary. Because TrenStar also takes ownership
of assets and charges customers on a ‘per-use’ basis, manufacturers
can entirely outsource responsibility for this non-core function and ensure
that their costs are predictable and competitive.
Another example of RFID is Bayer Diagnostics, one of the world’s largest
medical diagnostics businesses. Working with Microsoft partner Smart421,
Bayer implemented an RFID-based production control system. The system monitors
and reports on every aspect of the manufacture of the company’s critical
cartridges for near patient blood-testing. The RFID tag embedded in each
cartridge collects, verifies and stores important data about their content
– vital for accurate test results.
RFID-enabled solutions have also been trialled by leading retailer Marks
& Spencer and technology provider HP. In addition, the Department of
Trade and Industry (DTI) has contributed significant funding to an RFID
centre of excellence to help small and medium-sized businesses (SMBs) increase
the efficiency of their operations using RFID-enabled technologies.
This local and global interest in RFID as a key enabler for the supply chain
and for achieving greater traceability for goods and equipment is also stimulating
the market for software that supports RFID. In 2005, this will increase
by 40 per cent to £323m. ABI Research also highlights that RFID integration
services will surpass RFID equipment revenues by 2007, reaching more than
£0.82m by 2005. In addition, many UK organisations are extending their
logistics solutions to incorporate RFID.
In order to prevent any one vendor being in a position to enforce its own
RFID standards across an industry, EPCglobal, a member-driven organisation
comprised of leading firms and industries focused on creating global standards,
is developing a standards-based network to support RFID. In a supply chain
based on consistent data, the technology makes it possible for business
partners to identify items and share information relating to them, including
their location.
Microsoft is playing a key role in the development of RFID standards. It
has been an active member of the EAN UCC working groups, collaborating with
organisations such as GCI, CIES, UDEX and others to play a key role in defining
standards for data synchronisation. It has been estimated that the impact
of poor data quality on supply chain efficiency equates to $30 billion a
year, further underlining the importance of creating standards for trading
partners across the globe to adhere to. Microsoft’s admission to EPGglobal
in April 2004 demonstrates its support of the global EPC standard for immediate,
automatic and accurate identification of any item anywhere in the world.
As well as joining EPCglobal, Microsoft has also announced the formation
of a new Microsoft RFID Council. The group will look at how retailers and
manufacturers can track and ship their merchandise more effectively using
the technology. The Council highlights a growing ecosystem of partners that
are building innovative RFID solutions on the Microsoft platform to enhance
control of key business processes, improve inventory visibility and provide
better customer service for manufacturers, distributors and retailers.
The Council, which operates worldwide, aims to deliver RFID solutions that
comply with global standards. They will also be low-cost, simple to deploy
and built on a robust, scalable technology infrastructure. Members of the
Council already include major consulting firms, system integrators (SIs),
independent software vendors (ISVs) and hardware manufacturers. Microsoft
partners Manhattan Associates, Alien
Technology and Printronix have also recently launched an RFID showcase at
the world renowned L’échangeur IT showroom in Paris. An Auto-ID
lab in Cambridge also showcases the technology and bolsters it with a hands-on
introduction to RFID and practical training for RFID adoption.
Microsoft has created a software platform to support RFID-enabled solutions.
It is built on open-standards-based technologies that can work with third
party applications and business processes. With the choice of sourcing and
integrating hardware from a wide range of suppliers comes potential for
a resultant reduction in hardware costs.
By selecting the right middleware companies will be best placed to maximise
the value of previous technology investments. Flexible middleware will help
companies to adapt and grow by allowing their existing applications to integrate
with new systems, such as those using RFID.
RFID offers new levels of visibility for companies that want to track physical
items between locations. In the retail supply chain, goods tagged at the
point of manufacture can now be traced from the factory to the shop floor,
providing a real time view of inventory for all supply chain partners.
Awareness of RFID technology and the benefits it delivers is increasing
across the industry in both the UK and globally. By playing a key role in
developing the infrastructure required for RFID, Microsoft is contributing
to the momentum of mass deployment. The fully-integrated Microsoft architecture
for RFID embraces a vision for increased operational efficiency and reduced
costs. It enables the exchange of RFID related data in near real time across
disparate systems and corporate boundaries. It also supports standards for
global data synchronisation and interoperability with EPC, which is a prerequisite
for global adoption of RFID.
Through a network of world-class partners, including ISVs, hardware vendors
and systems integrators, Microsoft is delivering RFID solutions that add
value to businesses and enable fast returns on technology investments.
* According to the Venture Development Corporation, 16th March 2004.
Written by Gary Roberts, Retail Business Manager Group
Lead, Microsoft Ltd. |
•
Home
|
