Webcast: Getting started with RFID in manufacturing

In part one of a three-part series of automatic identification and data capture (AIDC) technology, industry expert Dylan Persaud discusses the many use cases for radio frequency identification (RFID) in manufacturing. Viewers will find an introduction to RFID technology and learn how to apply it to the manufacturing process.

Read the transcript below.

Hello and welcome to the SearchManufacturing [inaudible 0:00:05] webcast. I'm Brenda Cole, site editor, in part one of a three-part series on RFID technology. We'll be discussing how RFID can be used in manufacturing. Our expert speaker today is Dylan Persaud, managing director of Eval-Source. Welcome, Dylan.

Dylan Persaud: Morning, Brenda, how are you today?

I'm doing great, thank you.

Persaud: Thanks for having us on. So today, basically, we will be discussing media stream on how to use RFID in manufacturing and supply chain environments. Today's agenda basically for the webcast today is the relationship of RFID to bar codes, how they are related. The benefits of using RFID within a manufacturing environment, and actual uses of how RFID is being used in the industry today.

Having a more precise picture of inventory requirements facilitates organizations to plan, procure much more effectively.

Dylan Persaud,
industry expert

RFID, there are relationships between bar codes and RFID. They're complementary technologies, but they can exist mutually exclusive. Usually companies bundle them together and gain both benefits of RFID and technology. Some of the uses do overlap, but RFID gives a more accurate picture, often with real-time data, due to the system update capability, and usually without human intervention.

Having a more precise picture of inventory facilitates organizations to plan and procure much more effectively. An example of this by automating processes are within the receiving process, where RFID can actually be scanned at the case level to identify with each SKU within the container, or within the carton; thereby at the case level it automatically does the receipt, and the order is automatically received

Now this slide basically discusses the benefits in RFID in manufacturing and some of the ways they're actually used. So an advantage RFID has is to lower inventory and carrying costs. This is done by providing real-time information so that correct and accurate data decision-making about product, procurement and manufacturing can occur.

RFID in this case provides decision support to planners and executives about the state of inventory and the capital outlay that is currently in use. And how they procure their orders to maximize inventory sourcing to have enough product to fulfill orders and enough stocks for customers.

Having a more precise picture of inventory requirements facilitates organizations to plan, procure much more effectively. It allows organizations to manage their spend and cash flow by balancing order quantities to existing demand. Now to provide a high degree of product security and authentication. An example of this is, basically, RFID provides a high level of security authentication for high-value security components. RFID is commonly used in the aerospace industry to prevent counterfeit parts in components. Using RFID helps quality control, improves traceability and insures customers authentic parts and components, which are vital in the aerospace industry.

Issues such as the wrong type of material being used in the manufacturing process are part of the non-traceability from suppliers, are issues where RFID is used to secure and authenticate the component. An example of this within the shipping process for automation is when shipping is actually created from an order, and the manifest has to be built at the case level; the case level is actually scanned using our RFID, and the manifest is automatically built for that order or that pallet.

Now this slide here basically discusses the various industries that RFID is used in manufacturing. So RFID is used in manufacturing, has made significant advances in technology that has actually stabilized systems. Technology and ultimately the main concern of no perceived ROI in excess of cost where the main issues before. What has happened since is tag prices have come down, and companies have actually jumped on board to getting RFID. One of the biggest problems was there was no perceived ROI before, and now that companies have cheaper tags, they actually see how the benefits can help them within the organization.

First, the systems were too complicated. They were cumbersome; they required extensive outlay of cash. Technical resources available for the implementation and, in many cases, middleware was involved where an additional system would also have to be implemented, as well as the hardware. Since then, it has basically come down in terms of lowering costs per tags, but also supply-chain visibility, issues such as work-in-progress, increase quality control, asset management; whether these may include tools, machines, components and safety concerns are all issues with RFID today.

So some of the industries that use RFID are varied across the board, such as medical, healthcare, many manufacturing industries, such as automotive, aerospace, retail, services, service-based industries, distribution, oil and gas, and other various items through the supply chain for various work-in-progress processes, asset tracking and inventory control.

So uses in RFID manufacturing touches tool tracking, asset management, fleet management, automation, quality control, inventory tracking, work-in-progress, safety and preventative maintenance. These are all actual uses of RFID and how they're being used today within the organization.

Organizations basically use RFID for tool tracking, such as if a tool is commonly left on a job site unattended, possibly as a mitigation for pilfering and also to identify tools, as tools are commonly lost. Asset management is used in RFID for basically things such as car rentals, and fleet management where they're managing such as a rental car or a fleet of trucks, and basically you have to use the RFID to track those assets across either the country or possibly use them for preventative maintenance.

RFID can be used in that respect as well to be a proactive facilitator to give the company alerts on the next set of maintenance that may be needed for a particular fleet or asset. Automation, basically the automation within processes themselves, they can be a number of things. They can be a work in progress. An automation for a shipping process, a receiving process, even perhaps a pick and a put-away.

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Quality control is also used with RFID in terms of basically when the tag is actually scanned in, quality control … Uses of RFID in manufacturing: tool tracking, asset management, fleet management, automation, quality control, inventory tracking, work-in-progress safety and preventative maintenance. Those are all basic ways that RFID is used in manufacturing today.

Some examples for tool tracking would be where tags are actually placed on tools that are often misplaced or left on job sites, or very hard to find. And also mitigates against pilfering. RFID can also be used to manage fleets and asset management, such as in the case of car rentals where the car is actually scanned in upon receipt and when the customer returns it, is checked back into inventory.

Automation with RFID can refer to processes such as inventory, tracking, receipts, outbound shipments and, possibly, some other picking and packing instructions operations within the warehouse. RFID can also be used in quality control for such things such as high-value components and to prevent counterfeiting. And safety and preventative maintenance is also a key way of using RFID in terms of companies can actually now be proactive in not only their safety but also if they're managing things like fleets. They can use it as preventative maintenance and be proactive rather than reactionary.

Slide seven basically discusses the actual uses of RFID in inventory control, and in production scheduling. So, within inventory control, the way RFID is used is increased inventory visibility throughout the supply chain. So it gives the company a better overall view of their current inventory status. Real-time location tracking of assets, supplies and resources; this can also include people. Reduction of inventory stock levels due to the efficiency that RFID will bring. Tooling high-value equipment, maintenance, control and tracking. And asset allocation and reallocation.

This basically refers to how an asset is used and if it is being used efficiently. Now RFID in production scheduling pass several uses as well. These two are very much intertwined. So improved demand forecasting, real-time knowledge of raw material and equipment location. Personnel tracking, significant improvements in production scheduling. Disposal and tracking of hazardous materials and by-products and proactive maintenance.

These two processes are closely related because of the complementary nature of RFID and the stages of which they are actually used. RFID in this case can be thought of cause and scenario effect. RFID is used to track high-level equipment and tools which may be replaced on a work site or something along that line. Since RFID and inventory purposes tracking usually happens at an item level. This leads to more efficient processes at the level above that, which is usually the sales-order and purchase-order level. So it maximizes demand, increases forecast planning and order fulfillment, and impacts the customer experience. It can significantly reduce capital expense and manage cash flow better for the organization.

Now slide eight basically discusses the RFID uses within [inaudible] and RFID within workflow capability. So RFID within the [inaudible] is basically … [inaudible] is more or less lean technology or lean management. So, in this particular case, RFID aids in the protocol, which uses the [inaudible] to track levels of inventory and restocking scheduling. RFID replaces bar codes and adds real-time tracking. RFID is constantly automatically obtaining, organizing and updating information.

RFID in workflow is actually provide a real-time location status in work- in-progress units, increases efficiency, offers a tighter level of inventory control and gives robust metal tags, actually can be used in complex manufacturing environments where labels are not appropriate.

So RFID can be used to track item-level information and location, which aids in restocking through schedule availability. It replaces bar-code technology here, as it is more often readily available and provides real-time tracking as in a production line for an automotive manufacturer.

A significant advantage of RFID over bar codes is two-way communication. The RFID is constantly updating, organizing and obtaining information, and provides information back to the system as well as feeding back to you, and updating in a bi-directional way. The way RFID is used within workflows can lead to locate work-in-progress items and [inaudible] stage of production. It can also provide the data to include increase workflow efficiencies as adjustments can be made on the fly or often be reengineered. Increases inventory efficiency, and RFID tags can be made of metal for extremely complex manufacturing where bar-code labels may not be appropriate.

Today's media stream discussed the benefits of RFID, the industries where they are used and how RFID is used in manufacturing processes throughout the supply chain. Thank you for attending the media stream of RFID in manufacturing. And we look forward to answering any question you may have on RFID and its implementation.

Thank you, Dylan, and thank you all for joining us today. For more on RFID, please visit SearchManufacturingERP.com.

Persaud: Thank you, Brenda.

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