Preconference Seminar RFID in Warehouse and Inventory Management

Transcription

1 1 Preconference Seminar RFID in Warehouse and Inventory Management Harold Boeck,Ygal Bendavid (UQAM, Academia RFID) 1

2 RFID: The Keys to Success RFID: The Keys to Success Wednesday, October 06, RFID Connections To paraphrase the old retail adage, there are three keys to successful RFID implementation: education, education, education. Bert Moore, Editor Of course, the only way to accomplish that is to embark on continual education about the technologies, products and applications Preconference seminar Agenda Warehouse & Inventory Mgt in the RFID Supply Chain 11:30 Linking RFID to Inventory Management Best Practices 12:15 Targeting the Correct RFID Technology for the Right Project 13:45 Key Steps in Building an Inventory-Management RFID Solution: Build Your Own RFID Portal 14:30 Designing Your RFID Solution 15:30 Building Your RFID Business Case 16:15 Preconference Seminar Ends 2

3 RFID in Warehouse & Inventory Mgt Contextual issues US Companies carry $1.1 trillion in inventory spread along the supply chain with $450 billion at manufacturers, $290 billion at wholesalers and distributors, and $400 billion at retailers It is estimated that the average holding cost of manufacturing goods in inventory in the US in appreciatively 30% of the total value of the inventory Inventory is an obvious candidate for cost reduction Source: Us department of Commerce in Russel & Taylor, Operation management 5 th ed., 2006 Linking RFID to Inventory Management Best Practices Harold Boeck,Ygal Bendavid UQAM, Academia RFID 3

4 Your presenter Harold Boeck Professors at the UQAM Co-Founders of ACADEMIA RFID Ygal Bendavid RFID certified BAA, MSc.A., Ph.D. 4

5 About RFID Centre of Excellence Professional Training & Certification Vendor-Neutral Consulting Feasibility Studies & Applied Research RFID Custom Solution Development RFID Project Management Our Lab in Montréal RFID Lab Source: Academia RFID Lab. 5

6 Objective of the presentation Understand how RFID ties in with warehouse inventory & SCM Identify how RFID facilitates warehouse best practices Position RFID as an enabler of more efficient W&IM Warehousing is an integral part of every logistics system. It plays a vital role in providing a desired level of customer service at the lowest possible total cost Over the years, warehousing has developed from a relatively minor facet of a firm's logistics system to one of its most important functions. Warehousing: part of a firm's logistics system that stores products (raw materials, parts, goods-inprocess, finished goods) Provides information to management on the status, condition, and disposition of items being stored. Source: Source : Lambert D. and Stock J (2001). Strategic Logistics Management, chap 5. Financial Impact of Inventory 6

7 What is Inventory Management Inventory is the stored accumulation of transformed resources (e.g. materials, information, and money) Inventory management is the activity of planning and controlling accumulation of the resources that flow through supply networks, operations and processes Slack et al., Operations and Process Management, Principles and practice for strategic impact, 2006 Why Have Inventory? Insurance against uncertainty/demand fluctuations A mean to counteract the lack of flexibility Allows to take advantage of short term opportunities Can increase in value Fills the processing pipeline Etc. Slack et al. (2006), Operations and Process Management, Principles and practice for strategic impact, 2006) 7

8 but there is a cost to inventory Ties up money (working capital) Can become obsolete Can be damaged or deteriorate over time Can be lost or expansive to retrieve Can take up excessive storage space (vs. its value) Can involve high admin. & insurance costs Etc. Inventory Management & RFID The underlying objective of inventory management is to minimize inventory while maintaining acceptable customer service THEN HOW CAN RFID HELP? 8

9 What business people want RFID Visibility! They want a solution to a problem They want information they can use to improve the way they do business They don't care where the information comes from or how it was gathered since it is accurate They don t want to buy (RFID) technology What business people want An fully integrated working solution 9

10 What is visibility Data is captured & translated into information Information is a resource Visibility is the access to this resource RFID as a enabler & Visibility is a mean manage mobile assets, tools & vehicles, inventory, in ways that were never before possible What data might be useful to collect & analyze? How it could be used? Value of information What is (EPCIS) Visibility Data? Visibility on events dimensions EPCIS Data consists of events, each of which records something that happened in the real world. Often, though not necessarily, triggered by reading an RFID tag. What: what physical objects were involved (EPC or other identifier) When: when the event took place (timestamp) Where: where the event took place (location identifier) Why: what business process step was being carried out RFID (EPCIS)Event EPC (SGTIN) :ACAD :55:00 EPC (GLN): ACAD Receiving 17.4 deg Source: adapted from Using EPCIS Data Sharing for Full Supply Chain Visibility K. R. Traub, Ken Traub Consulting LLC, 10

11 What is (EPCIS) Visibility Data? Visibility on events dimensions RFID Event EPC (SGTIN):ACAD EPCs(SCCCs) :ACAD :55:00 EPC (GLN): ACAD Receiving 17.4 deg Source: adapted from Using EPCIS Data Sharing for Full Supply Chain Visibility K. R. Traub, Ken Traub Consulting LLC, From data capture to information management From (inventory) data capture to (inventory) information management What: When:10h30 AM Where:(X, Y) Why:Shipping to XX How: 17 deg. Cel With RFID data, it's not just what you know; it's what you do with what you know 11

12 Warehouse time of demand volatility & RFID Top Pressures Affecting WM Source: Aberdeen Group, 2009 Achieving Corporate goals through effective WM There are limits to warehouse management improvement if you work in isolation ( ) There are limits to RFID ( ) if proper sustaining infrastructure is not in place RFID is not a Magic Bullet, it is one tool among a broader portfolio of tools Source: PACE Model from Aberdeen Group,

13 Warehouse Mgt. best practices & RFID potential application - Obtain ASN for inbound deliveries - Reject unplanned receipts - Directly enter receipt into computers - Put away items immediately after receipt - Eliminate the receiving function (direct delivery to prod.) - Repackage incoming items into increments ordered by customers - Assign docks on the minimum warehouse travel time - etc Source: Adapted from Bragg, S. Inventory best practices, 2004 Warehouse Management strategies & RFID potential application Labor Management Task Management Slotting Load Building/Cubing Advanced Picking Advanced replenishment ( ) ability to track real time activities by worker ( ) productivity! LMS Software (module) ( ) ability to interleave tasks cycle counting with day to day job! E.g. in/out combined cycles ( ) ability to find optimal mix of storage medium / ideal location ( ) re-profiling the W ( ) determine the ideal shipping container for items ( ) Pick to ship pallet or box level! Zone Picking, Cluster picking, batch Picking, put systems, Automated Min/Max replenishment, demand demand based replenishment, Top Top off off repl.; repl.; etc etc level of granularity Auto Data collection Talking inventory? Ability to adapt on Seasonal adjustment Be careful when building the pallet!!! Auto Data collection! Reduce errors! Alternatives? Smart shelves! ekanban Source: Adapted from Aberdeen, High Performance strategies for Optimizing the warehouse,

14 Inventory Management strategies & RFID potential in advanced replenishment 1. WHO opened the cabinet 2. WHAT item has been removed 3. At WHAT time 4. (For WHICH patient it is intended) 5. Trigger a Replenishment! Source: Mobile Aspects Source: Terso ( ) real-time data improves service, streamlines inventory, improves expiration & recall management and eliminates the need to maintain excess inventory no reporting required! Inventory Management strategies & RFID-enabled 2Bin Kanban system RFID 2Bin Replenishment System ERP/WMS Source: 14

15 Warehouse management design RFID smart Shelves!... Warehouse management design The Smart Container A mobile warehouse "The SMART Container has the ability to always know not only the location but the contents of containers, down to the unit level, at any point in transit ( ) It's like a UAV [unmanned aerial vehicle] for logisticians" Patrick Sweeney, ODIN's founder and CEO. Source: ODIN technologies on 15

16 Inventory/Warehouse Management on RFID Journal...Tomorrow interrogate tags at close range, and to transmit read data to an ipadvia a Bluetooth connection...began rolling out the system to all 60 sites, automate the process of conducting inventory counts of cages filled with laboratory animals, increase visibility into its pool of plastic pallets W&IM in 2011 RFID Journal Awards Best RFID Implementation Gerry Weber International ( )Clothing items can be tracked from factories to multiple warehouses and on to 200 stores 16

17 W&IM in 2012 RFID Journal Awards Bell Helicopter Textron, for a WMS that uses RFID to track parts shipped from a central warehouse to several production facilities Cisco Systems, for an RFID solution that allows the company to track IT assets across all of its facilities worldwide, and to have real-time visibility into their locations. "We wanted to take a business view of it before jumping into the technology solution Maryanne Flynn, Cisco's director of operations RFID Journal, Mar. 20, Finalists Unveiled for Sixth Annual RFID Journal Awards 33 Look at existing projects Mission Foods reducing costs while increasing ecological performance! CPG CASE STUDIES -Mission Foods is tracking reusable plastic trays at the food supplier's Texas warehouse to reduce loss Cost of a tray: $8 apiece Lost: thousands of trays= $3.5 M Solution: RFID- based tracking system & returnable plastic trays (replacing disposable corrugated $1 apiece) 3 fixed readers in 150,000-squarefoot warehouse Initial deployment: 2009 in Dallas, Texas DC. Source: RFID Journal, 2011 RFID Journal Award Winner Aug. 1,

18 Look at existing projects Multiple projects in the garment/apparel supply chains Source: RFID Journal, 2011 RFID as an enabler of more efficient Inventory Management Provide information to support key decisions (e.g. order quantity) Ensure better inventory management (e.g. FIFO, inventory turnover, etc.) Facilitate physical counting Reduce the impact of probabilistic demand Facilitate reordering approaches 18

19 Thank you! Harold Boeck Ygal Bendavid UQAM, School of business 315 Ste-Catherine est Local R-3570 Montréal (Québec) Canada H2X 3X2 Tel: (x 2429) Web site: Academia RFID 9916 Côte de liesse, Montréal QC Canada H8T 1A1 Tel: Fax: Web site: