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"Intermec Capital provides creative financial solutions for customers
implementing Intermec ADC, global
supply chain, RFID, mobile computing, bar code printers and scanner
technologies."
Source : Intermec
Top 10 Supply Chain Technology Trends
Supply Chain is also known as :
Business Supply Chain,
Improve Supply Chain,
Managing Supply Chain,
Retail Supply Chain,
Strategic Supply Chain,
Strategic Supply Chain Management,
Supply Chain Analysis,
Supply Chain Automation,
Supply Chain Best Practices,
Supply Chain Collaboration,
Supply Chain Companies,
Supply Chain Cost,
Supply Chain Council,
Supply Chain Definition,
Supply Chain Distribution,
Supply Chain Forecasting,
Supply Chain Information,
Supply Chain Innovation,
Supply Chain Integration,
Supply Chain Inventory Management,
Supply Chain Issues,
Supply Chain Logistics,
Supply Chain Management.
It’s easy to name “mobility” and “wireless” as trends, but it’s less
clear exactly what direction these developments are taking and
how they can be used to improve business. One can hardly pick up
a business or IT magazine without seeing multiple articles about
the growth of mobile and wireless technologies. And it seems
people can’t put down their PDAs, smart phones and other mobile
computing and communications devices, at least when judging by
the adoption rates and future growth projections.
But what’s missing in all this attention is context, particularly
regarding how adoption of these technologies is creating
improvements in enterprise and supply chain operations. For
example, identifying mobile computing, printing and GPS as
growth technologies doesn’t explain how one ield service provider
combined them to save at least 40 minutes per crew per day,
and up to $2.1 million in overtime. This white paper does. It also
provides many more examples of how to use technology for
business advantage.
Intermec has been helping companies take advantage of the
latest technologies for manufacturing, distribution, ield service
and other supply chain environments for more than 40 years.
We pioneered many of the data capture, mobile computing and
wireless communication technologies in use today, and continue
to innovate through our close collaboration with leaders in wireless
networking and data services, enterprise software and other
advanced technology development. Drawing on our experience
with thousands of customers worldwide, access to analysts and
researchers, close relationships with IT leaders, and extensive
network of solution providers, we have identiied the top 10
technology trends in mobile, industrial and supply chain operations
environments for 2007-2008. This white paper identiies these
trends, explains how they apply to supply chain operations, and
presents results from users who have adapted the technologies to
improve their businesses.
Here are the top 10 trends and technologies impacting supply chain
operations spanning production, distribution, retail and remote
service
- Comprehensive connectivity – from 802.11 wireless LAN
technologies, cellular networks, Bluetooth
- Voice and GPS communication integrated into rugged
computers
- Speech recognition
- Digital imaging
- Portable printing
- 2D & other bar coding advances
- RFID
- RTLS
- Remote management
- Wireless and device security
You’re probably familiar with the technologies listed above,
but perhaps not with the latest developments and trends. For
example, did you know that practically any application can be
easily modiied to accept speech input because of the recent
development of terminal emulation-based speech recognition
technology? Did you know that Bluetooth, 802.11b/g, cellular and
GPS communication are all available in a single handheld device?
Did you know improved optics allow 2D bar codes on paper to
be read at greater distances (over 50 feet) than 1D bar codes on retrorelective labels? Read on to learn more about how these and
other developments are helping make production, distribution,
service and other supply chain operations more eicient.
Connectivity
The various forms of wireless connectivity – Bluetooth for
personal area networking, 802.11 wireless local area networking,
and cellular wide area wireless networks for voice and data
communication – are all highly visible and provide compelling
business cases for many speciic operations. Although innovation
and adoption is continuing at a strong pace, these trends aren’t
new. What is new and signiicant is how these technologies are
being combined into single devices that provide multiple forms of
wireless functionality, bringing convenience to both users and to IT
staf responsible for managing mobile devices.
Smart phones have strong appeal because they provide convenient
voice and data access. However they are extremely limited for
delivery, ield service and other mobile supply chain operations
because the computer screens and interfaces aren’t optimized for
enterprise applications, and the devices themselves aren’t rugged
enough for everyday use in these environments. For operations
with intensive data collection or transaction volume, companies
have traditionally used ruggedized handheld computers to gain the
reliability and performance they need, but these devices lacked cell
phone capability.
Advanced Wireless: Voice & GPS
Now leading cellular carriers have certiied rugged handheld
computers for voice communication, enabling data collection, data
communication and cell phone functionality to be converged into
one device. Users don’t need to worry about keeping separate cell
phones and computers charged and maintained, nor do they need
to switch back and forth between devices to complete routine
tasks. Converging data and voice onto an integrated piece of
equipment can cut the number of devices system administrators
need to support in half, which provides sustainable operating cost
savings. Bluetooth is also frequently integrated with these devices
to interface peripherals and further reduce total cost of ownership
by eliminating the costs of repairing and replacing cables.
Connectivity convergence continues with the integration of
GPS communication into mobile computers. For example,
Intermec’s CN3 includes wide-area wireless voice and data, 802.11,
Bluetooth and GPS connectivity in a handheld computer small
enough to it in a shirt pocket. Together with the falling costs of wide area wireless coverage (including GPRS, GSM, CDMA and
other technologies) and more generous data plans, computing
innovations like these make it afordable and practical for many companies to implement real-time data access systems for their
delivery drivers, sales and service staf, inspectors and other
personnel.
Case in Point
Stanley Steemer, a carpet cleaning franchise, automated
route operations at two branches with mobile computers with
integrated wide-area wireless connectivity, GPS and a magnetic
stripe reader to process credit card payments in real time when
service was completed. Dynamic dispatch enabled by the GPS
and real-time two-way communication enabled Stanley Steemer
to improve eiciency enough to eliminate a full-time dispatcher
position at each branch. One location is saving between $300 and
$700 weekly in overtime, and both branches have greatly reduced
time required to complete and process paperwork.
Speech Recognition
The “other” voice technology for supply chain operations – speech
recognition for hands-free data entry – is also undergoing a
new wave of innovation and adoption. Speech recognition helps
productivity by reducing the need for users to look at a computer
display. Following the larger IT trends of open systems and
interoperability, speech synthesis/recognition capability can now
be easily embedded into numerous legacy software packages,
including warehouse management, picking and putaway,
inventory, inspection, quality control and other applications.
This simpliied integration has been made possible by the recent
development of terminal emulation (TE)-based speech recognition
technology, which eliminates the need for a separate speech server
and a proprietary interface between the speech system and the
application software. TE enables speech synthesis to reduce the
need to look at the display, and speech recognition to function
as a true input technology, not as a separate application that has
to be managed and integrated. By using terminal emulation to
format and process speech input/output, data lows from and into
existing software applications as if it had been entered by bar code
scanning, key entry, or whatever method was previously used.
TE-based speech recognition systems can work with warehouse
management systems in real-time, which is another important
innovation from traditional speech recognition technology.
Traditional speech recognition was often implemented for highthroughput
operations where system planners valued speed and
productivity over accuracy, especially for picking. Bar code data
entry is considered more accurate, and speech input is generally
acknowledged as enabling superior productivity because workers
keep their hands and eyes on the picking operations and aren’t
interrupted by using the computer screen and keyboard or scanner
to initiate and complete operations. One analysis for a highvolume
distribution center concluded bar code data entry was
four percent more accurate than traditional speech (99 percent
compared to 95 percent), but bar coding would require 26 more
full-time equivalent (FTE) workers to handle the same transaction volume. When a hybrid system featuring TE-based speech
recognition was analyzed, it was found to match bar code data
entry accuracy while requiring 22 fewer FTEs, making it the overall
most eicient method when the consequences of correcting
picking errors were considered.
Case in Point
Lighthouse for the Blind, a non-proit organization in St. Louis
that trains and employs non-sighted workers, improved its
warehouse picking accuracy by 25 percent with a new speech
recognition system. The innovative system includes audible
conirmation of picked items, enabling blind workers to accurately
pick orders.
Digital Imaging
Like cellular voice, digital imaging is another technology consumers
are familiar with that has now found a place in enterprise mobile
computing equipment and applications. Transportation and
distribution companies are using digital cameras integrated into
the mobile computers so their drivers can capture proof of delivery, store stamped invoices, and detail conditions that prevent delivery. Technicians use the technology for proof of service.
Other applications include capturing shelf displays and monitoring
trade promotion compliance, collecting competitive information,
documentation by inspectors, collecting evidence for accident
reports, and recording damage and usage conditions for warranty
claims.
Case in Point
Mission Foods is one of the world’s largest producers of tortillas.
Its products are sold throughout the U.S. by independent
agents operating in a direct-store-delivery environment with
supermarkets and retailers. Mission Foods converted from
manual invoicing to creating invoices on a handheld computer and
generating a copy for the customer with a mobile printer. Invoice
records are sent to Mission headquarters in real-time over the
Cingular wide area wireless network.
The practice eliminated the need for Mission Foods to scan in and
process thousands of paper invoices. The company also expects
ive-igure annual savings from converting from its legacy invoices
to thermal printing and supplies. Drivers use compact wearable
printers, saving the time and fatigue associated with climbing in
and out of the cab to print.
The application also illustrates the value of converged wireless
connectivity: the handheld computers used communicate with the
mobile printers via Bluetooth, transmit invoice data by GPRS, and
use wireless LAN connectivity at distribution centers.
Portable Printing
Rugged portable printers are routinely used for output when
documentation is required. Common applications include providing
signed delivery receipts, purchase orders, work orders and
inspection reports. Using mobile printers and computers together
lets sales, service and delivery personnel give customers the
documentation they desire, while creating an electronic record
that frees the enterprise from having to process paperwork.
Mobile printers remain one of the fastest-growing segments
of the entire printing industry. Traditional applications are in
ield service and distribution, but adoption is growing quickly in
warehouses and factories for forklift-based printing for picking,
putaway, shipment labeling and other activities. Mobile printing
provides proven labor savings in industrial environments by saving
workers from having to make an unproductive trip to a central
location to pick up labels, pick tickets, manifests and other output.
2D Bar Code
Two-dimensional bar codes have long been a proven and popular
technology for operations where it is desirable to present a lot of
information in a limited space. However, 2D has remained a niche
technology, in large part because symbols can be diicult to read
in many usage environments. As reading ability has improved, so
has the adoption and value of 2D bar coding. The recent emergence
of auto-focus imaging technology will help bring 2D bar codes into
the mainstream for item management, traceability, MRO and
other operations.
Most organizations have needs for multiple bar code applications
with diferent symbologies, symbol sizes and encoded data. For
example, large-format linear symbologies are ideal for warehouse
shelf location labeling, four-inch labels with a bar code ield are common for shipment labeling, and 2D bar codes are ideal for
work-in-process tracking plus lifetime part identiication and
traceability. A traditional reader couldn’t recognize both a linear
shelf label from 50 feet away and a 2D symbol on a part. Carrying
two separate readers is impractical, so organizations have often
foregone the use of 2D symbols in favor of more common linear
bar code applications.
Now users no longer have to make a tradeof. For example,
Intermec’s EX25 auto-focus scan engine is the irst bar code
reader that can read linear and 2D bar codes alike from 50 feet
away and as close as six inches. Complementary developments
in illumination technology enable bar codes to be successfully
read in dark environments where they couldn’t be read before.
These developments make bar coding available in environments
previously thought to require RFID, or where automated data
capture was considered impractical. The use of Data Matrix and
other 2D symbologies is already growing strongly for permanent
item identiication, product genealogy and traceability. With
a scanning infrastructure in place to process all types of codes
at multiple distances, companies can start building advanced
visibility and traceability features into their legacy production,
inventory and distribution operations.
Case in Point
“For end users, having one scanner that reads codes in
any orientation dramatically improves productivity. For IT
departments, the EX25 decreases the number of data capture
devices needed, reducing training and support costs.”
Steve Banker
ARC Advisory Group
RFID
RFID is also more practical than ever before, with clear business
cases being demonstrated for asset management and supply chain
operations alike. For example, the U.S. Navy used RFID data entry
to reduce the time for one mission-critical inventory process by 98
percent. TNT Logistics reduced its truck load veriication time 24
percent by using RFID to automatically record goods loaded onto
its trailers. Hundreds of other companies around the world are
also implementing RFID-based shipping, receiving and inventory
visibility applications. See case studies on these systems and the
other organizations referenced in this white paper at
www.intermec.com.
A sub-trend behind RFID adoption for inventory, warehouse and
distribution operations is the use of vehicle-mounted and other
mobile RFID readers to enhance or replace stationary models.
With a mobile infrastructure, companies don’t need to purchase,
install and maintain a separate RFID reader for each dock door.
Forklift-mounted and handheld readers can cover multiple docks,
and be used in warehouse aisles and elsewhere throughout the
facility, further reducing the required RFID investment. Plus, they
put information directly in the user’s hands, so they can prevent
errors, rather than just record them after they occur.
Case in Point
“RFID-enabled forklifts ofer an opportunity for end-users to
reduce investment in reader infrastructure without compromising
capability.”
Erik Michielsen
ABI Research
The lexibility of a mobile RFID infrastructure is helping many
companies who implemented EPC Gen 2 systems to meet
customer requirements to make internal use of the technology.
Shipment veriication and inventory update systems are most
common, but advanced track-and-trace applications are emerging.
For example, several pharmaceutical electronic pedigree
(e-pedigree) systems have been developed to take advantage of
EPC technology, and pending FDA regulations favor its use for
supply chain traceability.
case in point
The U.S. Social Security Administration (SSA) implemented RFID
systems in a warehouse to track inventory and facilitate more
eicient shipping to branch oices. The SSA realized a 39 percent
productivity improvement and $1 million in annual savings.
An additional 70 percent labor savings is expected following
completion of a system upgrade and expansion.
Compliance tagging and other RFID supply chain initiatives get
considerable attention, but according to some research estimates
implementation is growing even faster for asset management.
These applications are fairly well established and provide a clear
and strong business value, so the rapidly increasing adoption
is not a surprise. Asset management applications also provide
an opportunity to leverage an RFID foundation developed for
compliance or other distribution activity for internal beneits.
RTLS
Real time location systems (RTLS) allow you to expand your
wireless local area network into an asset tracking system. An
important market driver is the Wireless Location Appliance from
Cisco Systems, which enables asset tracking through a Cisco
wireless LAN. Any device connected to the wireless LAN can
be tracked and located. One application is to track forklifts via
their vehicle-mounted computer’s radio. The Wireless Location
Appliance and supporting software can track the radio’s location
in real time to support eicient dynamic storage, routing, monitor
dwell time, and gather data for productivity and asset utilization
analysis. Many other expensive products and assets can be
equipped with an RTLS device for real-time monitoring.
Remote Management
Using wireless LANs to track warehouse and factory assets is
an example of how a mainstream IT resource has been adapted
to beneit industrial environments. Another example, powerful
remote management systems have been developed speciically to
conigure, monitor and troubleshoot bar code readers and printers,
RFID equipment, ruggedized computers and other industrial data collection and communications equipment. Network
administrators have typically had little visibility or control over
these remote devices because enterprise IT asset and network
management systems are made for common PCs, servers, and
network equipment and don’t address the conigurations and
usage conditions speciic to data collection and computing in
industrial environments.
Here are a few examples of why general-purpose management
systems have limited efectiveness for preserving uptime and
managing equipment used in supply chain operations.
- Ruggedized computers are like their oice cousins in that they
periodically require software updates and security patches, and
should be monitored to ensure consistency in conigurations
and software versions.
- Bar code and RFID smart label printers periodically need to
be updated with new label templates and bar code formats,
and use thermal print technology, which sometimes requires
heat setting adjustments. Bar code printers have specialized
command languages, so they are largely incompatible with
print monitors and other applications made for oice laser and
inkjet printers.
- RFID readers can be optimized for their immediate
environment by changing power output and making other
tuning adjustments.
Device management software is available to meet all these needs
plus provide real-time monitoring and notiication if devices
go oline, and if implemented with open systems standards, it
can be accessed through your enterprise network management
solution (e.g. Tivoli). Companies use such software to improve
reliability and uptime in mission-critical production, distribution
and service operations. Such software is also extremely valuable
during rollouts and upgrades, because system administrators
can use it to set conigurations and install software remotely
and across groups of devices, instead of having to handle each
device individually. These features take a lot of the time and cost
out of managing devices, making it much more cost eicient
to keep systems up-to-date with new software and security
enhancements.
Security
Stronger security is another mainstream business trend and
requirement that is supported in supply chain technology. Mobile
computers can be locked down so customer information and
other data can’t be accessed if the device is lost or stolen. Rugged
wireless computers and data collection equipment also support
many of the leading securities used to protect enterprise wireless
networks, including 802.11i, 802.1x, WPA, WPA2, LEAP, FIPS-140,
RADIUS servers, VPNs and more. Wireless data collection devices
that support Cisco Compatible Extensions (CCX) can be fully
included in a Cisco Uniied Wireless Network and take advantage
of all the associated management, reliability and security
features, including hacker and rogue access point detection,
authentication and encryption, integrated irewalls and more.
Conclusion
Business needs for security, real-time visibility, and up-to-date
information don’t stop at the oice door. These needs extend
throughout supply chain operations, so reliable information
systems must extend just as far. Developments in mobile
computing, wireless communication, RFID, bar code and other
data collection and communications technologies are helping
businesses extend visibility and control over more areas of their
operations.
This white paper has provided a few examples of how
organizations are taking advantage of supply chain technology
trends. Intermec is helping many more companies and government
agencies of all sizes improve their production, distribution service
and other supply chain operations using these top 10 technologies.
Contact Intermec today to learn how the latest services,
technologies and trends can be adapted to help your business.
Intermec Inc. (NYSE:IN) develops, manufactures and integrates
technologies that identify, track and manage supply chain
assets. Core technologies include RFID, mobile computing and
data collection systems, bar code printers and label media. The
company’s products and services are used by customers in many
industries worldwide to improve the productivity, quality and
responsiveness of business operations. For more information
about Intermec, visit www.intermec.com or call 800-347-2636.
Contact Intermec Investor Relations Director Kevin McCarty at
kevin.mccarty@intermec.com, 425-265-2472.