Let's get ahead of ourselves for a moment. Close your eyes, and picture your distribution center operation as it exists today. Now, fast-forward 10 years. What do you see that's different?
If you're like many logisticians, you see a facility that has been enormously altered by the presence of wireless, mobile technology. Every item in the DC has an auto ID tag, most likely based on radio-frequency technology. The tags act like little voices. They call out to you 24/7. If you need to locate something, you simply adjust your operating system's "hearing" to home in on the appropriate little voice.
Sound far-fetched? It's not, in the view of many industry observers. They see auto ID as the breakthrough technology to watch—the one that will forever change the way in which our supply chains operate.
It's not hard to find the root cause of all the hype. If you look at industry magazines or Web sites, attend conferences or trade shows, or meet regularly with technology vendors, you've undoubtedly heard that auto ID is on the cusp of something really big. It may well be.
There's no question that RFID technology can boost efficiency and velocity in DC operations, if only because RFID readers and transmitters can communicate in real time. This in and of itself is a quantum leap forward from, say, bar-code technology, where data on inbound, outbound and in-stock inventory can only be captured when it's in a bar-code scanner's direct line of sight. Auto ID provides the ability to track all movement within a given supply chain in real time, not just at scannerequipped points along the way.
This capability is certainly intriguing. So much so that many companies are making huge investments in RFID tags and readers. As we've been reporting, Gillette has ordered 500 million tiny RFID tags that it will start placing on its products later this year. Once the tags are in place, the company will be able to track products through their lifecycle, from manufacturing, to distribution, to point of sale delivery. Pretty amazing stuff.
Still, some little (non-RFID-related) cautionary voices out there remind us that although auto ID breakthroughs will almost certainly enhance supply chain operations, it's possible that they won't change our work lives completely. As MIT's Yossi Sheffi points out in this month's Thought Leader Profile, a lot of technologies and business practices change the way we play the game, but only a small number actually change the game itself.
At this point, it's impossible to say which auto ID will ultimately be. You need a little perspective to make that call. For example, telephones, automobiles, television and personal computers were once widely considered to be toys—amusing distractions,maybe, but not likely to make their way into the mainstream. And certainly not likely to change the way we live.
Who could for get the now—infamous quip from Ken Olsen, head of Digital Equipment Corp. in the late '70s? When asked about the emergence of personal computers and their impact on DEC's mainframe computing business, Olsen made it clear he was not worried. Why not? "The entire worldwide market for personal computers will be about 10," he answered.
Of course, ultimately, each of the technologies mentioned above brought about profound changes in the way we live. The telephone and the automobile industries changed the way we communicate and travel. Television changed the way we learn about the world (and the way we entertain ourselves).
Computers? Well, some would argue that the biggest changes are yet to come. At a minimum, though, it's safe to say Olsen underestimated the power of the CPU.
As Sheffi points out, it's important to distinguish between those things that are evolutionary and those that are revolutionary. It will be some time before we can determine just where auto ID technology falls.