|
With growing pressure for improved asset management and accountability, RFID has an important role to play Marcus Scholes, Real Asset Management International
RFID has been making waves for over a decade as organizations throughout the supply chain look to leverage unprecedented ease and accuracy of goods tracking to drive down costs and improve product availability. But, as yet, the technology has not achieved optimal results. This is particularly relevant within the retail environment where RFID tag costs make it impractical to take the technology beyond pallet level, undermining the vision of individual product tracking from the manufacturer to the store shelf.
However, the technology has gained significant traction in other areas here in the U.S. and abroad; most notably, new passports now include RFID tags and other transportation payment systems are utilizing the tags as well.
Indeed, the technology has also been embraced by libraries, museums and higher education institutions to track valuable assets. The result of this diversification of RFID application is a significant reduction in unit cost over the last few years.
With increased focus on organizations across both public and private sectors to improve asset accountability and traceability, isn't it time more organizations considered the benefits of RFID?
Asset Challenge
There is now a greater understanding across organizations of the value of accurate asset registers -- and the potential business cost of today's endemic inaccuracy. With upwards of 50% of assets on most registers no longer in use, organizations recognize they are in danger of over-paying insurance premiums, creating mismatched disaster recovery plans and even creating inaccurate company valuations.
Furthermore, compliance to International Financial Reporting Standards (IFRS) demands fixed asset management accountability and the provision of a full audit trail. With IFRS becoming increasingly prevalent within the public sector, the spotlight is now on the widespread poor asset management processes that have resulted in these highly inaccurate asset registers.
From highly mobile items such as laptops that cannot be accurately located, to heavy machinery composed of multiple component parts that are frequently changed by maintenance without being recorded, organizations simply have no idea what happens to assets once in use.
But how many businesses can afford to periodically interrupt production to undertake a manual audit? Taking manufacturing processes offline or disrupting operations is just not a viable option for most businesses. Furthermore, manual audits can be notoriously inaccurate; horror stories abound of organizations that have embarked upon manual audits only to discover that many months into the exercise only 60% of assets have been checked.
Indeed, even those organizations that have adopted barcodes in a bid to impose greater control and visibility over their asset base still struggle to gain access to certain parts of the infrastructure -- from production lines to clean environments such as hospital operating theatres.
The ability to use RFID technology to scan hundreds of assets at once, from a single point, while ensuring business continuity has the potential to transform the entire asset management process.
RFID in Practice
But can RFID actually deliver on this promise? Are the tags reliable and robust in production environments and just what is the possible maximum range between tag and RFID reader?
The first decision organizations need to make is whether to opt for Active or Passive RFID tags. Passive tags are significantly cheaper -- around 50 cents, as opposed to $40 to $60 per active tag. However, they have a limited read range and do not hold much information, constraining the development of a single source of all asset history.
The active tags by comparison have their own internal power source, which broadcasts the response signal to the reader. As a result, these tags have a far longer read range, typically more than 300 feet. In addition, active tags hold far more information about the asset, enabling organizations to transform the depth and accuracy of asset history.
The additional functionality offered by active tags convinced leading fast moving consumer goods manufacturer, Unilever, to deploy this form of RFID technology to track 20,000 assets across several production lines at its manufacturing site in Gloucestershire, England.
With each piece of machinery comprising many distinct components, the ability to scan hundreds of assets simultaneously from a distance is a major benefit; many of these components are extremely hard to reach and would require the production line to be turned off to undertake a physical audit.
Real Time View
Unilever is also leveraging the additional memory on the active tags to create a complete history of each asset, from initial purchase order number, through location, unique serial number and its child/parent relationship to other machinery and full maintenance history.
This latter point is particularly important for the management of complex equipment comprised of multiple components and for environments requiring the highest level of health and safety check and audit. With this technology, each assembly line manager can be tasked with maintaining a specific list of assets. Using a hand-held PDA, scans can be undertaken regularly. Information is directly input into the integrated asset register and maintenance system and exception reports highlight any missing assets.
This implementation of RFID within Unilever demonstrates the technology's potential for asset management across every industry sector. By creating a single source of asset purchase, location, maintenance and disposal information, organizations can reduce errors and attain an immediate view of maintenance status at any time. In critical environments such as the emergency services, this up-to-date information on equipment status not only saves time but also minimizes the risk of an ambulance or fire engine attending an incident without fully compliant equipment.
Furthermore, the process is simple and straightforward, requiring minimal resources, which drives down costs. And this is an essential point: Despite growing pressure to deliver asset accountability and traceability, organizations simply cannot afford to undertake repeated manual audits, each of which can take months.
By adopting RFID, not only can scanning be undertaken by line managers on a regular basis in a matter of minutes, without impacting the organization's core operations in any way, but also the tight integration with the full asset history ensures unprecedented accuracy and auditability of the entire asset register.
Marcus Scholes is Vice President of U.S. Operations for Real Asset Management International.
|
