RFID is not the solution
Re: "is RFID ready to jump into the pool?" (November 2007)
It's nice to see an article on pallets (as opposed to another article on software)! Unfortunately, the article does not recognize the 800-pound gorilla in the room. Pallet users are driven by variable operating costs, which, in the case of pallets, are "costs per trip." In a "closed loop" environment (like HEB's DCto-store movements), the capital investment cost (pallets, readers, hardware, software) may well be justified by the savings in variable costs. In an "open" environment (in which pallets are used to ship product from manufacturers to distributors), what is the value proposition? How does a pallet with RFID capability reduce a manufacturer's trip cost? If it doesn't, then it's a tough sell. For pallet pool operators like CHEP and iGPS, does RFID help them manage their assets and lower their operating costs? If so, then they could share the savings with their customers and it would be an easy sell. Apparently this is not the case, since adoption, as you put it, has been "slow."
The potential for improving overall supply chain performance by improving the contribution from pallets is huge. But RFID is not the solution. What is needed is a new process for sharing the investment cost of the pallet such that the trip cost absorbed by each trading partner is minimized. Third-party pooling has replaced pallet exchange in many segments of the supply chain but has disappointed many. A better solution is on the horizon.
Dave Sandoval, President, B.U.S. Systems Inc.
Editor's note: The writer is head of a pallet management firm that offers an alternative to pallet rental and pallet exchange programs. His proprietary system, the B.U.S. Process, transfers actual ownership of the pallet as it moves through the supply chain in order to reduce costs and administrative chores.
over the top
Re: "don't forget the boots on the ground," SpecialHandling (November 2007)
The military/business analogy is stretched beyond the breaking point. Yes, the military is a great example of logistics and is often a leader in creating and deploying technology, but this opinion piece is way over the top, with the constant parallels between the two organizations non-stop from beginning to end. Please spare us this overwrought rot.
Brian Devereaux, London Drugs
a laughing matter
Re: "my annual letter to Santa," FastLane (December 2007)
I wanted to let you know that I just read your article (excuse me, your "letter to Santa") and thought it was terrific … especially the closing about an MBA on a forklift, which made me laugh out loud!
Pamela Zoellner, MCR, CSM; Senior Vice President, UGL-Equis
under surveillance?
Re: "RFID legislation can be senseless," BigPicture (November 2007)
Although I agree with you that the likelihood that RFID chips will be implanted in humans without their consent is zero, I believe you may have missed the underlying concern. If RFID chips get implanted in items that are worn or carried—including IDs such as driver's licenses and medical cards—they could pose a very real privacy threat.
Once that level of technology is affordable and the scanning and computing capability catches up, it would not be hard for industry and government to start tracking people. Given the government's willingness to trample on individuals' privacy rights in the name of "homeland security," I can see why some states and people are nervous.
I, for one, do not want that technology on me until it can be proven that it can only be accessed with the owner's consent and that the owner knows exactly what information is contained on the chip. Just imagine walking through an airport (or any public space) that's equipped with technology that can read all the RFID chips in your clothes, license, and blood donor card in real time! Now is the time to get a handle on what information is on these chips and how it is accessed, not after it is in place.
Gary Deane, Applications Engineer, Retrotech
