P&G moves ahead with RFID investment
P&G has announced development agreement with T3Ci to develop
its electronic tagging capabilities, reports Simon Pitman.
The companies aim to jointly develop a range of strategic RFID applications as learning continues behind RFID programs at multiple retailers that fall in line with Electronic Product Code global standard. P&G decided to make RFID a priority in an effort to prevent an estimated $50 to $100 million it spends each year on reprocessing inaccurate orders.
Last year the company successfully implemented an RFID tagging system with Wal-Mart, making it one of the first consumer products company to meet the retailer's tough requirements.
Speaking about the company's most recent investment in RFID, Steve Rehling, P&G's director of IT and head of RFID systems said: "We chose to work with T3Ci on EPC analytics and applications after evaluating the capabilities of a large number of solution providers. The company was well ahead of the other companies we evaluated and demonstrated a clear understanding of how to eventually get value from EPC data across the supply chain.
"We have had the opportunity to work with T3Ci on EPC analytics for the past year and have now decided to expand our partnership to working collaboratively on EPC applications," he added.
Jonathan Golovin, CEO T3Ci, said: "Procter & Gamble is not only an experienced early pioneer in the exploration of the potential benefits of RFID technology, but has also demonstrated leadership in the development of EPCglobal standards. Our experience working with them as well as our other early adopter customers over the past year has allowed us rapid learning cycles to gain insight and grow our products based on actual learning."
As part of its support for the study of RFID, the Procter & Gamble Fund last month awarded a $150,000 grant to Indiana University's Kelley School of Business to develop and expand its RFID educational resources for undergraduate and graduate students.
The fund manages contributions on behalf of P&G, which has had a long-standing interest in RFID and was a founding member of the Auto-ID Center, the originator of Electronic Product Code technology.
Although concerns remain over the expense of implementing RFID, retailers and suppliers alike are resigning themselves to the inevitability of adopting the technologies and to the benefits that it is expected to eventually bring.
Company's such as P&G have had to lead the way in the implementation of RFID tagging system because of fierce pressure from retailers to comply with their own supply chain criteria. But as the biggest cosmetics and personal care players have now largely fulfilled these obligations in the US, pressure is now mounting on the smaller players to become RFID compliant if they are to remain competitive.
RFID tags are tiny computer chips connected to miniature antennae that can be affixed to physical objects. The most commonly application of RFID contains an Electronic Product Code (EPC) with sufficient capacity to provide unique identifiers for all items produced worldwide.
When an RFID reader emits a radio signal, tags in the vicinity respond by transmitting their stored data to the reader. Passive (battery-less) RFID tags, read-range can vary from less than an inch to 20-30 feet, while active (self-powered) tags can have a much longer read range. The data is then sent to a distributed computing system involved in supply chain management or inventory control.
