RFID where your mouth is
Royal Philips Electronics’ semiconductor division has deployed a major implementation of radio frequency identification (RFID) in its supply chain in Asia, using its own technology.
The move marks the first major RFID rollout in the semiconductor industry and came about through a partnership with IBM . "It's exciting to see an RFID manufacturer take the technology they've been promoting and bring it into their own four walls," says Sara Shah, an analyst at ABI Research.
"We've shipped over a billion units of this technology," Philips Semiconductor's Alistair Banham, senior VP and general manager, said. "When we look at the potential in the supply chain for our own internal activity, as well as the market at large, it's a very, very exciting and explosive opportunity for us."
In Philips' case, the internal-only Asian RFID project covers the tagging and tracing of wafer cases and carton packages for flows of goods between its manufacturing facility in Kaoshiung, Taiwan, and its Asia Pacific distribution centre in Hong Kong.
Philips said the results have shown increased inventory turns, improved stacked lead time, enhanced delivery reliability, warehouse efficiency and improved customer service, including a reduction in both inbound and outbound through-put time and in handling time by 50 per cent.
"We're evaluating how we roll this out to other parts of the semiconductor business," Banham says. If done, the move would touch five semiconductor manufacturing facilities and three distribution centres in Asia/Pacific, Europe and the US.
"And also, at the corporate Philips level, we have set up an RFID competence centre to look at how we take the benefits of this technology into our other product divisions within Philips," which include medical, consumer electronics and domestic appliances.
The company also plans to support customer integration of RFID in their supply chain management processes.
In addition to IBM, which has provided consulting and the overall system integration for this project, other industry vendors are also involved. Tags will be delivered by Smartag and Tagsys, readers will be delivered by Tagsys, and printers will be delivered by Zebra , Philips says.
1-Apr-2005