ROOM 4 – BUSINESS CASE

RFID and the Logistics Service ProviderSpeaker:

Jeremy DuddlestenManger, WMS Implementations, Contract Logistics - U.S.

Kuehne + Nagel

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RFID and the Logistics Service ProviderKuehne + Nagel’s RFID Value Proposition

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About Kuehne + Nagel• Founded in 1890

• Headquartered in Schindellegi, Switzerland• Leader in integrated, global logistics solutions

• #1 in sea freight• Top 5 in airfreight volume• Global contract logistics infrastructure• Lead Logistics solutions• 600 offices in 96 countries, 18,500 specialists• Financially strong

• Global quality & consistency• Minimal reliance on agents• ISO 9001 Global Accreditation

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Agenda

• RFID in the context of Kuehne + Nagel• Contract Logistics Services:

• Helping customers meet RFID requirements issued by major retailers

• Leveraging RFID for operational performance improvement and inventory control

• Transportation & Freight Forwarding Services• Leveraging RFID for improved visibility, command and

control in the logistics supply chain

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Contract Logistics Project Context

• Kuehne + Nagel Contract Logistics: Providing Compliance Services• Leading retailer requests suppliers to provide RFID

tagging at case and pallet level• Customer: Leading Provider of consumer medical

devices

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RetailDistribution

Center

Warehouse(Alsip, IL)

Data Center(Naugatuck, CT)

CustomerSales Office

Kuehne + Nagel RFID Process

OrderInfo

Customer

OrderData

Order

ManufacturerManufacturer

TaggedItems

Non- taggedItems

• RFID tagprinting

• Palletization

• Case/Palletvalidation

OrderShipment

Retail

• Validate casesand pallets

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WAN

Solution Components

Data Center(Naugatuck, CT)

Warehouse(Alsip, IL)

WMSDatabase

Omron V740 RFID Readers

ALEWrite/Read

Request

Write/ReadResponse

Palletization Data

Zebra Smart- label

Printer

ALE

Order Data

SMSDatabase

SOAP

RFIDDatabase

Act

ion

Workflow

Act

ion

Act

ion

Avicon epcExpress

ConnecTerra RFTagAware

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Tag and Ship Process

• Cases pass through RFID portal as pallet is built.• During palletization epcExpress will associate RFID

tags to the pallet including pre-tagged items.• Verification portal reads contents of pallet. This can

be compared to actual order.

Unlabeledcarton

RFIDprinter

Labeledcarton

RFIDconveyor portal

Labeledcarton

Labeledshipping pallet

Shipmentverification portal

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Sample Use Cases

• Case/Pallet tag(s) are automatically printed.• 6 case tags and 1 pallet tag are printed.• SKU “GHJ” is already tagged, a new tag will not be printed.

WMS

Y2GHJPallet_3

N1DEFPallet_3

N5ABCPallet_3

IS TAGGEDTAGSSKUCONTAINER

ID

ORDER# 12345

Y2GHJPallet_3

N1DEFPallet_3

N5ABCPallet_3

IS TAGGEDTAGSSKUCONTAINER

ID

ORDER# 12345

OrderData

epcExpressEPC Tag Printer

Pallet Labels: 1Case Labels: 6

Mixed Pallet – with previously tagged SKU

• Damaged tags can be re-printed.• Test printing tags for newly added SKUs.• Order data is not required to be received to print tags.

Manual Tag Printing

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Learnings…

Expected Actual

RF Engineering• RFID tagging of medical supplies• Sweet spot analysis

Containerization• Where should containerization happen?

• Order system vs. Shipping system vs. RFID process level?

Integration• Sending information between existing systems and

epc Express• Speed of connectivity between shipping system,

RFID middleware and RFID hardware

Easy Moderate Involved

• No liquids, little metal, no interference.

• Tags applied to cases after pallet built.

• Auto printed tags, but palletization done manually because data received at both container and single case level.

• Logic added for capturing container data and loose case data.

• Data sent asynchronously to printer to avoid delay of response.

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…Learnings

Expected Actual

Printer Setup• Setup printer and create labels

• Re-calibrate for different tag sizes (4x6, 4x2)

• Tag printing performance

epc Express Functionality• Requiring re-print for tag replacement, quick printing of test tags, flexibility to create tag when necessary• Validate tag reads of shipments in pilot phase

Easy Moderate Involved• Difficulty aligning text

and tags on smart-labels.

• Calibration tricky due to tag issues, tag alignment, and print speed.

• Time consuming to find optimal configuration.

• Manual tag printing screen was used quite often.

• Validation portal at time of shipment logged tags read on entire pallet.

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Using RFID to Control the Import of Industrial PrintersLICON Pilot Project

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Pilot Project Scope

• Cooperation of

• Key proof points:• Use of EPC/RFID across continents• Use of EPC/RFID to provide supply chain

visibility• Exchange of data in open, multi-party supply

chain

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Project Scenario

EuropeNorth America

Munich DC(Kuehne+Nagel)

Munich Airport(Lufthansa)Customer

Poing Factory(Océ)

JFK Airport(Lufthansa)

• Océ Industrial Printers tagged and read in Poing, GY• Shipments read and verified at Kuehne + Nagel, Munich Airport• Shipment read and verified at Lufthansa, JFK Airport

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Project Pain Points

EuropeNorth America

Munich DC(Kuehne+Nagel)

Munich Airport(Lufthansa)Customer

Poing Factory(Océ)

JFK Airport(Lufthansa)

• Supply Chain Visibility –Lack of in-transit shipment visibility• Event Management – Lack of real-time event correlation from

supply chain with execution plan• Shipment Complete – Lack of on-time shipment complete

information causing deployment delays

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Technology Stack

Supply Chain Visibility

Avicon epcRMS

EPC middleware

Siemens OHS

Avicon epcExpress™

Device management

Siemens OHS

ConnecTerraRFTagAware

Readers Samsys 9320 Multi Protocol

Air Interface ISO 18000-6 B

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Route Map Server

Plans & Schedules

ExecutionDataepcRMS (Route Map Server)

• Publish plans & schedules• Incorporate actual execution

data• Identify issues & meaningful

events

EuropeNorth America

Munich DC(Kuehne+Nagel)

Munich Airport(Lufthansa)Customer

Poing Factory(Océ)

JFK Airport(Lufthansa)

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Using Route Maps for Visibility<RMSRMPDetail segment="1">

…<node code="KN-MUC">

<previous><NodeCode>OCE-PG</NodeCode>

</previous><next>

<NodeCode>LH-JFK</NodeCode></next>

</node><Action>inbound</Action>

<Schedule><ExpectedDate>20040703

</ExpectedDate><ExpectedTime basis="UTC">1600

</ExpectedTime><Delay value="h">1.5</Delay>

</Schedule></RMSRMPDetail>

• Route maps represent plans and schedules for supply chain operations

• Route maps are initialized by the supply chain coordinator – in this case the freight forwarder

• Route maps are updated with actual execution data as execution progresses

• Route maps are the basis for event detection and management

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Sample Route Map ViewNode

Location CodePlanned KN-MUC

Actual KN-MUC

Delta None

InboundSchedule

Planned Jul-03 2004; 1600 UTCActual Jul-03 2004; 1500 UTCDelta 0 days; -1:00 hour

Item EPCsPlanned 3114F6478CB2D05E65000000; 3114F6478CB2D05E66000000;

3114F6478CB2D05E67000000Actual 3114F6478CB2D05E65000000; 3114F6478CB2D05E66000000; Delta 3114F6478CB2D05E67000000

OutboundSchedule

Planned Jul-04 2004; 0900 UTCActual NADelta NA

Item EPCsPlanned 3114F6478CB2D05E65000000; 3114F6478CB2D05E66000000;

3114F6478CB2D05E67000000Actual NADelta NA

Acceptable deviation

Short shipment

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Achievements• Item-level visibility across the supply chain

• Shipments & shipped items• Supply chain nodes and physical locations• Transitions between nodes• Comparison of plan to actuals

• Multiple participants execute a shared plan and report status• Shared, centrally hosted visibility infrastructure• Centralized logic detects meaningful business events and

triggers alerts• Lightweight and flexible integration allows for easy integration of

new participants and new networks• Leverage EPCGlobal standards – extended with logistics

business logic

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More Information

• LICON Website: www.licon-logistics.com

• Whitepaper: www.Avicon.com

• Microsoft Project Video: Avicon exhibit