Issue #141 | Apr. 11, 2008 | by Carl Brown

At this year’s DoD RFID Summit in late February, the U.S. Department of Defense announced a timeline of 2015 before the full rollout of RFID is complete. Seven more years. While this may seem like a long time, it sounds realistic when you consider the size and scope of what the DoD doing. Below are a few thoughts on factors affecting this timeline.

There are three factors impacting adoption:

1) Size and Open Standards
Added together, the suppliers served just by our company ship more than 10,000,000 items to DoD facilities every month. Add in those items shipped by the many companies we do not sell to and you have a lot of stuff moving every month.

RFID is definitely already helping determine what has been received by the DoD. In some cases, we see suppliers shipping 30,000 cartons of product to the DoD in a single order. Before RFID, the DoD had no way to count these cartons. With RFID, each carton is serialized and can be counted automatically.

New technology processes take a lot more time and effort to implement than existing closed-loop systems. The DoD cannot simply mandate ‘do it this way with these products' – they have to work through standards committees. This is a much slower process; but it makes open competition possible.

2) Suppliers
While 50,000 is a fairly typical number to hear for 'number of suppliers' to the DoD, it's not the true number of shippers. In 2007, DSCC (Defense Supply Columbus) said they awarded contracts to about 6,000 CAGE (Commercial and Government Entity) codes. CAGE codes represent a specific DoD contractor, though, a single DoD contractor can have several CAGE codes. Most contractors have one CAGE code, however. Large organizations like Northrop Grumman may have 100 CAGE codes.

We expect there are 4,000 actual DoD shippers, since many smaller shippers use packaging houses like EW Packaging to help with the extensive packaging and labeling requirements for the DoD.

Training 4,000+ companies on new open-standards processes is daunting. We estimate it takes us 30 minutes to explain 'how to the new RFID process works' to a DoD contractor and another 60 minutes to teach them how to use the WAWF (Wide Area Workflow) to upload their data. However, we have a closed-loop system. We specify our tags and our process. The DoD doesn't have that luxury and must provide generic, open solutions.

How does the DoD teach its suppliers? This is what takes so long to implement this new process.

3) Cost in an operational supply chain
The DoD can not simply 'stop accepting product' if it isn't tagged. The supply chain must continue to operate and the DoD must continue to train suppliers. This is the most important aspect. The DoD is fighting a war. There are troops awaiting the supplies. Delaying delivery is not an option.

Frankly, I'm impressed the DoD has gone as far as it has. In the past three years, the Department of Defense:

• Adopted the standards set forth by Wal-Mart and EPC Global.
• Implemented an RFID policy.
• Deployed hundreds of dock door RFID read points to collect data.
• Transitioned from Gen 1 to Gen 2.
• Educated thousands of suppliers and DoD employees on how to tag their RFID shipments.

And, the DoD has done all this while waging a war!

The disappointment in RFID's adoption stems from being too optimistic about the growth potential. This is new technology and needs systems and process built to use it.

The DoD RFID rollout is going well. It is going according to history. It is going as-fast-as-it-can.

Carl Brown is President of Simply RFiD (www.SimplyRFID.com).

While I agree in principle with many of Carl's statements (after all Ensyc has been singing this tune for over a year now), I disagree that the DoD is doing their best. There are two major roadblocks that have kept RFID integrators from providing services to DoD suppliers. The first is the CoC (Certificate of Conformance). Allowing suppliers to order pre encoded tags and waving a CoC at the QAR's when validation of compliance with the mandate is requested is idiotic. When PDF417 2D bar codes were first added to the Mil Spec 129 label, suppliers were required to have a method to read them in order to show the QAR that they were in compliance. Those readers cost $700-1200 each. RFID readers are available for as little as $395.

The second issue is enforcement. Even given the slow pace of full adoption of the mandate, over 35% of all awards contain RFID requirements, but only about 10% of packages received at the depots have RFID tags on them. Simple math says that's not likely to be full compliance with their contracts. It would be foolish of a supplier not to include the cost of compliance with RFID into their contract, but with the lack of enforcement, that just turns into a new money maker for the supplier and a cost to the DLA. Recently, the DLA ordered over 3,000 RFID printers for their depots and receiving stations. Sounds like they plan on marking all the packages themselves, since they can't seem to make the supplier do it. This costs the taxpayer double, since they are paying the supplier to meet the RFID requirement, then paying the DLA to do it when the supplier fails to comply.