John Johnson joined the DC Velocity team in March 2004. A veteran business journalist, John has over a dozen years of experience covering the supply chain field, including time as chief editor of Warehousing Management. In addition, he has covered the venture capital community and previously was a sports reporter covering professional and collegiate sports in the Boston area. John served as senior editor and chief editor of DC Velocity until April 2008.
Efficient. Cost-effective. Responsive. Those are some of the ways experts describe the RFID-enabled supply chain. But some might add nightmarish and overwhelming. That same infrastructure of smart tags and readers that promises to revolutionize supply chain management has raised fears among IT professionals, who fret that the data captured by millions of tag reads will cripple their networks and bring their enterprise systems to a grinding halt.
What's feeding those fears, in part, is a report issued by global IT research firm IDC this summer that once again raised concerns that the widespread adoption of RFID technology could overwhelm enterprise networks. The authors of the report, which was commissioned by Cisco, went so far as to predict that the success of an RFID deployment would hinge on a network's ability to handle RFID data intelligently and securely, right to the organization's edges.
"It is absolutely something that must be considered," says Greg Gilbert, director of RFID solutions and strategy at Manhattan Associates, which markets software to help companies assess the impact RFID will have on their networks. "You may find out that you're in great shape, or you may very well [find that you] have some work to do."
One company that's grappling with these RFID-readiness issues right now is the tire-maker Michelin. "We're looking at how all this will interface," says Pat King, the company's director of global electronic strategies. "When it comes to issues like how you want to manage the data to make it useful and how you migrate to event management, those are the things we wrestle with regularly and haven't reconciled yet. We're working through that with local closed-loop, tightly managed pilots."
Too much information?
Despite all the uncertainty, at least one thing is clear: now is the time to prepare for the upcoming data assault. This is particularly true for companies whose existing enterprise systems aren't equipped to handle the serialization of inventory. It's one thing to process items at the SKU level of detail; it's quite another to handle items identified by individual serial numbers. In other words, a system that has no trouble recording a quantity of 500 for one particular SKU might be overwhelmed by a stream of data containing 500 individual serial numbers.
The IDC report warns that companies need to act right away to ensure that their networks are up to the task of handling large-scale RFID rollouts. "RFID system expansion is inevitable, [because] proliferation throughout the supply chain is a core premise for the realization of system benefits," says Duncan Brown, UK consulting director for IDC and author of the report. "It is important for organizations to consider the impact on network infrastructure at the beginning of an RFID rollout and to build in scalability from the start. Adjusting the network design [after the fact] will be complex and expensive."
In the meantime, the warnings haven't stopped early adopters like Gillette from barreling ahead with RFID. The giant consumer packaged goods manufacturer recently projected annual savings in the 25-percent range from its RFID initiative. Gillette and other RFID pioneers remain convinced that the big RFID payoff will come when users are able to seamlessly integrate RFID with existing enterprise applications tied to bar-code, wireless local-area networks, enterprise resource planning, and other supply chain execution systems.
Overall, it appears that the dire Y2K-like predictions of enterprise systems crippled by information overload may have been overblown. "Clearly there is an expansion in the quantity of data involved [with RFID], but we haven't run into folks who are panicking," says Ashley Stephenson, CEO and co-founder of RFID startup Reva Systems. "We've had those ... conversations with our customers, and we're not of [the opinion] that the sky is falling and enterprise systems are going to get swamped with data," he adds. "I think the industry has [gotten past] the early fears of data storms resulting from all the tag reads."
Selective reading
Part of the reason why none of those doomsday scenarios has played out is that RFID projects are still at a stage where the information generated is minimal. Rollouts by Wal-Mart, Target and the Department of Defense, for example, all called for gradual ramp-ups. "It would be one thing if the federal government said all this had to occur overnight, but that's not happening," says Michelin's King. "Wal-Mart and the DOD are doing this with a limited number of goods."
In addition, many companies are simply storing their new information in data warehouses, with the intent of mining it later when needed.
Sophisticated new RFID readers and advanced middle-ware applications are helping users cope with the onslaught as well. New, more selective readers are being designed that report only the events and data that users request. And middleware can help users like retailers manage the reads they receive from hundreds of stores deploying RFID by forwarding only the data users request, like notification of a pallet's arrival at a store.
"We might read that pallet in the store 100 times over the next few days or weeks, or that information might stay local at the store and be stored for weekly extraction back to headquarters, but it's not flowing on an instant basis back to headquarters," says Stephenson, whose firm recently introduced its Tag Acquisition Network to help users manage their RFID systems. "Later, when the user needs to resolve some shipping discrepancy, it can extract the data or look up the details of a particular shipment and [track] it at different places in the supply chain and use that information to resolve a dispute with a manufacturer."
In another promising development, a new royalty-free software standard for using EPC technology in the supply chain was released by EPCglobal Inc. in September. Known as the Application Level Events standard, or ALE, it establishes the approach EPC-enabled software products will take to collecting, managing and routing data generated by EPC technology in the supply chain.
"The ALE concept is a critical component of the EPCglobal architecture in that it provides the first line of defense for enterprise systems against the onslaught of EPC tag data," says Chantal Polsonetti, vice president at ARC Advisory Group. "As standards-based RFID middleware, ALE provides both a buffer to physical layer infrastructure activities and a platform for distributed edge computing."
Essentially, the ALE software eliminates the need for an enterprise application to tell the system how to get the data it wants and provides a much higher-level interface, relative to having to program low-level events. Polsonetti says the software will eliminate a lot of the labor associated with gleaning useful information from the torrents of data. It also provides a middleware driver platform that allows enterprise systems to interface to a variety of different devices.
Economic activity in the logistics industry continued its expansion streak in October, growing for the 11th straight month and reaching its highest level in two years, according to the most recent Logistics Managers’ Index report (LMI), released this week.
The LMI registered 58.9, up from 58.6 in September, and continued a run of moderate growth that began late in 2023. The LMI is a monthly measure of business activity across warehousing and transportation markets. A reading above 50 indicates expansion, and a reading below 50 indicates contraction.
October’s reading showed the fastest rate of expansion in the overall index since September of 2022, when the index hit 61.4. The results show that the industry is continuing its steady recovery from the volatility and sluggish freight market conditions that plagued the sector just after the Covid-19 pandemic, according to the LMI researchers.
“The big takeaway is that we’re continuing the slow, steady recovery,” said LMI researcher Zac Rogers, associate professor of supply chain management at Colorado State University. “I think, ultimately, it’s better to have the slow and steady recovery because it is more sustainable.”
All eight of the LMI’s indices grew during the month, with the Transportation Prices index showing the most growth, at nearly 6 points higher than September, reflecting increased activity across transportation markets. Transportation capacity expanded slightly during the month, remaining just above the 50-point threshold. Rogers said more capacity will enter the market if prices continue to rise, citing idle capacity across the market due to overbuilding during the pandemic years.
“Normally we don’t have this much slack in the market,” he said. “We overbuilt in 2021, so there’s more slack available to soak up this additional demand.”
The LMI is a monthly survey of logistics managers from across the country. It tracks industry growth overall and across eight areas: inventory levels and costs; warehousing capacity, utilization, and prices; and transportation capacity, utilization, and prices. The report is released monthly by researchers from Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP).
The port worker strike that began yesterday on Canada’s west coast could cost that country $765 million a day in lost trade, according to the ALPS Marine analysis by Russell Group, a British data and analytics company.
Specifically, the labor strike at the ports of Vancouver, Prince Rupert, and Fraser-Surrey will hurt the commodities of furniture, metal products, meat products, aluminum, and clothing. But since the strike action is focused on stopping containers and general cargo, it will not slow operations in grain vessels or cruise ships, the firm said.
“The Canadian port strike is a microcosm of many of the issues that are impacting Western economies today; protection against automation, better work-life balance, and a cost-of-living crisis,” Russell Group Managing Director Suki Basi said in a release. “Taken together, these pressures are creating a cocktail of connected risk for countries, business, individuals and entire sectors such as marine insurance, which help to mitigate cargo exposures.”
The strike is also sending ripples through neighboring U.S. ports, which are hustling to absorb the diverted cargo, according to David Kamran, assistant vice president for Moody’s Ratings.
“The recurrence of strikes at Canadian seaports is positive for U.S. ports that may gain cargo throughput, depending on the strike duration,” Kamran said in a statement. “The current dispute at Vancouver is another example of the resistance of port unions to automation and the social risk involved with implementing these technologies. Persistent disruption in Canadian port access would strengthen the competitive position of US West Coast ports over the medium-term, as shippers seek to diversify cargo away from unreliable gateways.”
The strike is also affected rail movements, according to ocean cargo carrier Maersk. CN has stopped all international intermodal shipments bound for the west coast ports of Prince Rupert, Robbank, Centerm, Vanterm, and Fraser Surrey Docks. And CPKC has stopped acceptance of all export loads and pre-billed empties destined for Vancouver ports.
Connected with the turmoil, Maersk has suspended its import and export carrier demurrage and detention clock for most affected operations. The ultimate duration of the strike is unknown, but the situation is “rapidly evolving” as talks continue between the Longshore Workers Union (ILWU 514) and the British Columbia Maritime Employers Association (BCMEA), Maersk said.
Terms of the acquisition were not disclosed, but Mode Global said it will now assume Jillamy's comprehensive logistics and freight management solutions, while Jillamy's warehousing, packaging and fulfillment services remain unchanged. Under the agreement, Mode Global will gain more than 200 employees and add facilities in Pennsylvania, Arizona, Florida, Texas, Illinois, South Carolina, Maryland, and Ontario to its existing national footprint.
Chalfont, Pennsylvania-based Jillamy calls itself a 3PL provider with expertise in international freight, intermodal, less than truckload (LTL), consolidation, over the road truckload, partials, expedited, and air freight.
"We are excited to welcome the Jillamy freight team into the Mode Global family," Lance Malesh, Mode’s president and CEO, said in a release. "This acquisition represents a significant step forward in our growth strategy and aligns perfectly with Mode's strategic vision to expand our footprint, ensuring we remain at the forefront of the logistics industry. Joining forces with Jillamy enhances our service portfolio and provides our clients with more comprehensive and efficient logistics solutions."
In addition to its flagship Clorox bleach product, Oakland, California-based Clorox manages a diverse catalog of brands including Hidden Valley Ranch, Glad, Pine-Sol, Burt’s Bees, Kingsford, Scoop Away, Fresh Step, 409, Brita, Liquid Plumr, and Tilex.
British carbon emissions reduction platform provider M2030 is designed to help suppliers measure, manage and reduce carbon emissions. The new partnership aims to advance decarbonization throughout Clorox's value chain through the collection of emissions data, jointly identified and defined actions for reduction and continuous upskilling.
The program, which will record key figures on energy, will be gradually rolled out to several suppliers of the company's strategic raw materials and packaging, which collectively represents more than half of Clorox's scope 3 emissions.
M2030 enables suppliers to regularly track and share their progress with other customers using the M2030 platform. Suppliers will also be able to export relevant compatible data for submission to the Carbon Disclosure Project (CDP), a global disclosure system to manage environmental data.
"As part of Clorox's efforts to foster a cleaner world, we have a responsibility to ensure our suppliers are equipped with the capabilities necessary for forging their own sustainability journeys," said Niki King, Chief Sustainability Officer at The Clorox Company. "Climate action is a complex endeavor that requires companies to engage all parts of their supply chain in order to meaningfully reduce their environmental impact."
Supply chain risk analytics company Everstream Analytics has launched a product that can quantify the impact of leading climate indicators and project how identified risk will impact customer supply chains.
Expanding upon the weather and climate intelligence Everstream already provides, the new “Climate Risk Scores” tool enables clients to apply eight climate indicator risk projection scores to their facilities and supplier locations to forecast future climate risk and support business continuity.
The tool leverages data from the United Nations’ Intergovernmental Panel on Climate Change (IPCC) to project scores to varying locations using those eight category indicators: tropical cyclone, river flood, sea level rise, heat, fire weather, cold, drought and precipitation.
The Climate Risk Scores capability provides indicator risk projections for key natural disaster and weather risks into 2040, 2050 and 2100, offering several forecast scenarios at each juncture. The proactive planning tool can apply these insights to an organization’s systems via APIs, to directly incorporate climate projections and risk severity levels into your action systems for smarter decisions. Climate Risk scores offer insights into how these new operations may be affected, allowing organizations to make informed decisions and mitigate risks proactively.
“As temperatures and extreme weather events around the world continue to rise, businesses can no longer ignore the impact of climate change on their operations and suppliers,” Jon Davis, Chief Meteorologist at Everstream Analytics, said in a release. “We’ve consulted with the world’s largest brands on the top risk indicators impacting their operations, and we’re thrilled to bring this industry-first capability into Explore to automate access for all our clients. With pathways ranging from low to high impact, this capability further enables organizations to grasp the full spectrum of potential outcomes in real-time, make informed decisions and proactively mitigate risks.”