Transcript Slide 1
Delivering Value Through Global Standards
Patrick Javick EPCglobal North America
October 2007
Overview
• About EPCglobal • The Need for Global Standards • Current Standards • Tangible Results • Case Studies • Summary 2006 EPCglobal Inc
2006 EPCglobal Inc
Introduction GS1
Global Support:
• Standards • Frequency Allocation • Multi-Industry
Local Support:
• 109 Member Organizations • Training & Services • Localized Guidelines • Trading Partner and Regulatory
EPCglobal Overview
Role and Scope
Established Support Network Mission Guiding Principals Subscribers Board Member Firms
Neutral, not-for-profit organization owned by GS1 109 worldwide offices Commercialization of RFID technologies through global technical, application, and business process standards Reduce the risks and costs of implementation through adoption tools and services Driven by committed companies and supply chains By industry, for industry” is crucial success factor Must support “supply chain convergence” 1,000+ global firms with $6 trillion in revenues from 51 market segments fielding 3,000 participants Cisco Gillette Johnson & Johnson Procter & Gamble Lockheed Martin Dow Chemicals DHL Hewlett-Packard Metro Group Wal*Mart Sony US DOD 2006 EPCglobal Inc
Retail
Core Consumer Markets
Consumer Goods Food & Beverage Healthcare & Life Sciences Electronics & High Tech Logistics & Transport
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Growth Through New Industries
Aerospace & Defense Chemical Industrial Footwear & Apparel Automotive
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Overview
• About EPCglobal • The Need for Global Standards • Current Standards • Tangible Results • Case Studies • Summary 2006 EPCglobal Inc
2006 EPCglobal Inc
RFID drivers
Increased Outcome Higher Quality Tracking Traceability Automation Control Increased Visibility Reduce Cost Increase Security Authentication New Service New Product Feature Generate Value Fulfill Requirements CRM Mandate Law
© Stephane Pique
Why are global standards important?
• Reduce complexity – Within organizations – Between organizations – For H/W and S/W production and purchase decisions • Reduce cost – Implementation – H/W, S/W and Integration • Facilitate trading partner collaboration • Allow organizations to focus more on how to use the information than how to get information 2006 EPCglobal Inc
Supply chain visibility
• Potential to transform business process – bar code replacement alone will not deliver ROI • The power of event related information – Improved customer availability – Demand driven supply chain – Reduced inventory – Reduced counterfeit – Improved ability to track and trace – Shrinkage – Returnable Assets • Transformation of commercial relationships 2006 EPCglobal Inc
Global Standards & Competitive Advantage
The Case Study of Motorola vs Nokia
Time Division Multiplex Access Personal Communication Systems Global System for Mobiles Code Division Multiplex Access
• Three competing standards in U.S.
• Motorola must focus valuable engineering resources on supporting multiple standards • Motorola loses its early dominance in cell phone market • Global System for Mobiles 90% of world outside of North America • Single standard allows Nokia to focus engineering on value-added functionality • Nokia takes dominant position in today’s mobility market 2006 EPCglobal Inc
Standards allow technology providers to focus on innovation, not translation and intermediation
Global Standards & Supply Chain Convergence The manufacturers perspective: An apparel manufactures sells warm-up track suits to multiple retailers • How can the apparel be identified in one common way to meet multiple market needs without segregating inventories?
Solution: EPCglobal Tag Data Standard 2006 EPCglobal Inc
Global Standards & Supply Chain Convergence The retailers perspective: A retailer has inbound warm-up track suits, DVD’s, food & beverage, and household items. They need one system that will handle everything from receiving to point of sale.
How can a retailer purchase from many industries and use a common point of sale? Solution: GS1 Standards 2006 EPCglobal Inc
Overview
• About EPCglobal • The Need for Global Standards • Current Standards • Tangible Results • Case Studies • Summary 2006 EPCglobal Inc
The EPCglobal Community
Pulling diverse organizations together
Manufacturers Retail
End Users
Distributors Trade Organizations Other
Public Policy Technical Standards Regulatory Bodies
Frequency Compliance Public Health Industry Regulations
Requirements Industry Guidelines
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Technology Vendors
Software Vendors Consultancies Hardware Vendors
Education Programs
Rapid progress continues
• 11 ratified global standards • Network and security standards (supported by Architectural Review Committee Guidelines) • Item level tagging - UHF and HF work groups – Other tag types to follow (EPCglobal is tag “neutral”) • Certification services - confident technology use 2006 EPCglobal Inc
Electronic Product Code (EPC)
GTIN
1 2 3 4 5 6 7 1 2 3 4 5 6 Company Prefix Trade Item Reference
EPC
3 1 2 3 4 5 6 7 1 2 3 4 5 8 0000000123456 2006 EPCglobal Inc EPC Manager Number Trade Item Reference
GTIN The EPC can only be interpreted in combination with the corresponding data base Serial Number
EPCglobal Network Architecture
The Foundation of “Actionable Intelligence”
If you can’t see it, you can’t measure it If you can’t measure it, you can’t control it If you can’t control it, its probably costing you too much money….
And you probably don’t even don’t know how much 2006 EPCglobal Inc
Work items of EPCglobal
Secure Internet Exchange Event Registries ONS Search & Discovery
available under development
Internal Systems ERP, WMS, etc.
EPC IS EPC MW Enterprise System EPC Reader Authentication & Authorization EPC Tags
2006 EPCglobal Inc
EPC IS EPC MW Internal Systems ERP, WMS, etc.
EPC Reader Enterprise System EPC Tags
Overview
• About EPCglobal • The Need for Global Standards • Current Standards • Tangible Results • Case Studies • Summary 2006 EPCglobal Inc
Tangible Examples
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Electronic proof of delivery
• Avoiding waste of resources.
• EPC data was able to refute received amount 80% of occasions
Department of Defense
• Reduced order backlog form 92k to 11k orders • $1.7bn ROI over 7 years • Improving “confidence” in the supply chain –
Baggage tracking
• Improving control and accuracy • 99% read rate helping to solve a $1.6bn problem (Significant transport and logistics project now starting) 2006 EPCglobal Inc
Tangible Examples
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Apparel
• Improving customer availability • 20% improvement in accuracy (size and colors) –
Prompt movement of promotional items to sales floor
• Retailer 19% sales lift • Supplier 26% sales increase 2006 EPCglobal Inc
Tangible Examples
• RFID on Tap - WIRELESS LIQUOR INVENTORY MANAGEMENT – According to hospitality industry experts, every year in the United States, over $7 billion is lost due to “liquor shrinkage.” – 100% return on investment over 1.5 years – Piloted by Outback Steak in Miami 2006 EPCglobal Inc
Overview
• About EPCglobal • The Need for Global Standards • Current Standards • Tangible Results • Case Studies • Summary 2006 EPCglobal Inc
Business Case examples
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Metro
• Process efficiency - 12% to 17% (incoming merchandise & shelving) • Loss/theft - 11% to 18% (depends on category) • Goods availability - 9% to 14% (reduction OOS) • Incoming goods - € 8.5mio (German est. only) –
Lemmi Fashion
(SME – 1 mio garments per year)
• Stock turnover before tagging - 5,000 to 10,000 items per day • Stock turnover after tagging - 20,000 items per day • Increase of 250%-300% in receipt and shipment of goods 2006 EPCglobal Inc
The Business Case and the numbers
• Increasing number of leading organizations are publicizing results, for example….
3 days
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Gillette
• Improving product launches and promotion •
“The Advantaged Strategy” –
moving beyond an all or nothing approach
16% 89%
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Wal Mart
• Improving on shelf availability • Broad based process improvements –
DoD
• Improving “confidence” in the supply chain
99% 20%
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Baggage tracking
• Improving control and accuracy –
Apparel
• Improving customer availability through improved inventory accuracy and control –
And many more…..
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Comparing Current Process to EPC- Enabled Process Revealed Significant Benefits
Receiving Checking Shipping Current Process 20 seconds per pallet 80 seconds to 20 minutes per pallet 10 seconds per pallet EPC Process 5 seconds per pallet 20 seconds per pallet 5 seconds per pallet
The example of promotions non-compliance
(Sanjay Sarma)
Future stock-outs Future unhappy customers Need to hit the mark exactly Lost sales Unhappy customers Run advertisements Publish TAB’s Launch product time Enabling Actionable Visibility
Overview
• About EPCglobal • The Need for Global Standards • Current Standards • Tangible Results • Case Studies • Summary 2006 EPCglobal Inc
In summary…
•
EPCglobal ..from hope to hype to implementation.
– The EPCglobal community grows stronger every day – Physics and standards challenges are being overcome – Prices are going down – The benefits of “visibility” are starting to be realized – The EPCglobal community has moved decisively from preparation to implementation
The race for business benefits and competitive advantage is on!!
2006 EPCglobal Inc
Questions
Patrick Javick Manager, Industry Development EPCglobal North America T: +1 609.620.8023
M: +1 609.477.9286 ----------------------------------------------------------- 1009 Lenox Drive, Suite 202 Lawrenceville, NJ 08648 www.EPCglobalNA.org
----------------------------------------------------------- 2006 EPCglobal Inc