1 00:00:00,000 --> 00:00:03,840 BILL: We have a very exciting group of people 2 00:00:03,840 --> 00:00:05,220 to talk to you this morning. 3 00:00:05,220 --> 00:00:08,730 And the way we structured this, as Steve said, is I'm 4 00:00:08,730 --> 00:00:11,910 going to give each person about 15 or 20 minutes 5 00:00:11,910 --> 00:00:13,050 to make their presentation. 6 00:00:13,050 --> 00:00:15,480 And we're going to reserve about 20 minutes 7 00:00:15,480 --> 00:00:16,890 at the end for questions, so I'll 8 00:00:16,890 --> 00:00:19,060 ask that you hold your questions until we finish. 9 00:00:19,060 --> 00:00:22,710 But we will then be up here as a panel to answer the questions. 10 00:00:22,710 --> 00:00:25,110 And the way we've got it structured is that-- 11 00:00:25,110 --> 00:00:26,610 I'm going to start off and I'm going 12 00:00:26,610 --> 00:00:28,260 to talk about a few things that we're 13 00:00:28,260 --> 00:00:32,009 doing at the University of Arkansas, and some of the holes 14 00:00:32,009 --> 00:00:34,740 that we see that are out there that need to be filled. 15 00:00:34,740 --> 00:00:40,020 And then we have Simon Langford from Walmart, 16 00:00:40,020 --> 00:00:41,910 we have Terri Crawford from Publix, 17 00:00:41,910 --> 00:00:44,860 and that's the retailer side of things. 18 00:00:44,860 --> 00:00:47,520 Then we have Dick Cantwell from P&G, Gillette, 19 00:00:47,520 --> 00:00:49,050 from the supplier perspective. 20 00:00:49,050 --> 00:00:53,020 And we have [INAUDIBLE] from DHL from the logistics side. 21 00:00:53,020 --> 00:00:57,060 So we've tried to cover the supply chain with as much 22 00:00:57,060 --> 00:00:59,140 as possible with our panelists here. 23 00:00:59,140 --> 00:01:05,010 And then we'll wrap up then with Brian Ceberano from MIT. 24 00:01:05,010 --> 00:01:06,480 Again, we'll start with academic, 25 00:01:06,480 --> 00:01:09,270 we'll end it with academic, and industry in between. 26 00:01:09,270 --> 00:01:12,000 So let's go ahead and get started. 27 00:01:12,000 --> 00:01:14,010 Again, welcome to our panelists. 28 00:01:14,010 --> 00:01:15,815 And I'll keep myself-- 29 00:01:15,815 --> 00:01:17,190 my job is going to be timekeeper, 30 00:01:17,190 --> 00:01:19,450 so I'll keep myself on time here. 31 00:01:19,450 --> 00:01:21,468 I want to talk about what we're doing again 32 00:01:21,468 --> 00:01:23,760 at the University of Arkansas, and then talk about some 33 00:01:23,760 --> 00:01:26,400 of the research areas. 34 00:01:26,400 --> 00:01:28,410 We have research in several areas. 35 00:01:28,410 --> 00:01:30,210 I'm restricted because of our topic here 36 00:01:30,210 --> 00:01:33,460 being a supply chain to those specific topics, 37 00:01:33,460 --> 00:01:37,830 but we're heavily involved in, at this point, technology 38 00:01:37,830 --> 00:01:38,857 deployment. 39 00:01:38,857 --> 00:01:40,440 We've got some groups that are looking 40 00:01:40,440 --> 00:01:44,310 at developing some technology, but for the most part, 41 00:01:44,310 --> 00:01:47,010 we're very heavy in deploying that technology-- 42 00:01:47,010 --> 00:01:51,960 static versus mobile readers, Gen 2, those type of things. 43 00:01:51,960 --> 00:01:54,090 We just-- our lab was just converted over. 44 00:01:54,090 --> 00:01:58,050 And I was just telling Simon, we're now totally Gen 2. 45 00:01:58,050 --> 00:02:00,670 No more Gen 1 testing for us at this point. 46 00:02:00,670 --> 00:02:02,130 And that's really from the demands 47 00:02:02,130 --> 00:02:03,930 that we're seeing from industry. 48 00:02:03,930 --> 00:02:07,200 Data analytics, I'll talk more about that in-depth. 49 00:02:07,200 --> 00:02:09,660 Making the business case, I'll talk more about that. 50 00:02:09,660 --> 00:02:13,560 But we're doing projects in middleware, open source 51 00:02:13,560 --> 00:02:14,700 development. 52 00:02:14,700 --> 00:02:18,420 Lots of work around public policy, consumer reaction type 53 00:02:18,420 --> 00:02:20,640 issues, animal ID. 54 00:02:20,640 --> 00:02:24,150 We've got a group in our ag department, 55 00:02:24,150 --> 00:02:26,550 and also with our close affiliation with our friends 56 00:02:26,550 --> 00:02:30,270 at Tyson down the street doing a lot in animal ID, trailer 57 00:02:30,270 --> 00:02:33,540 tracking, load status, trying to move more into the logistics 58 00:02:33,540 --> 00:02:34,330 area there. 59 00:02:34,330 --> 00:02:36,480 And then also as we move up the supply chain 60 00:02:36,480 --> 00:02:38,970 into manufacturing as well. 61 00:02:38,970 --> 00:02:40,680 Let me drill down into a couple of areas 62 00:02:40,680 --> 00:02:43,050 here and start off with data analytics. 63 00:02:43,050 --> 00:02:46,230 And that's one area that we've spent a great deal of time 64 00:02:46,230 --> 00:02:49,710 in trying to look at what the data is really 65 00:02:49,710 --> 00:02:51,000 trying to tell us. 66 00:02:51,000 --> 00:02:55,800 And I was having a conversation with Giselle this morning 67 00:02:55,800 --> 00:02:58,200 and a couple of conversations last night, 68 00:02:58,200 --> 00:03:02,400 and that's an area that really needs a lot of work. 69 00:03:02,400 --> 00:03:04,320 We're getting the technology in place. 70 00:03:04,320 --> 00:03:05,820 The technology will come along. 71 00:03:05,820 --> 00:03:08,380 We've got it we've got a lot of things we can do there, 72 00:03:08,380 --> 00:03:09,982 but it's about creating that data, 73 00:03:09,982 --> 00:03:11,940 and then turning that data into business value. 74 00:03:11,940 --> 00:03:15,630 And so that data is a very, very, very important piece. 75 00:03:15,630 --> 00:03:20,022 And we first look at this idea of the 100% read rates. 76 00:03:20,022 --> 00:03:21,480 And we've heard all kinds of things 77 00:03:21,480 --> 00:03:24,510 about we've got to see 100% of those read rates 78 00:03:24,510 --> 00:03:25,390 for it to make sense. 79 00:03:25,390 --> 00:03:27,360 And it really doesn't. 80 00:03:27,360 --> 00:03:29,790 There's implicit read versus an explicit read. 81 00:03:29,790 --> 00:03:31,800 Yeah, did you see it, or can you imply 82 00:03:31,800 --> 00:03:33,510 that if it went from point A to point C 83 00:03:33,510 --> 00:03:35,160 that it went past point B? 84 00:03:35,160 --> 00:03:37,950 And Sanjay talked about yesterday 85 00:03:37,950 --> 00:03:40,260 the idea of this phantom inventory. 86 00:03:40,260 --> 00:03:43,080 If you were to miss it, that's extremely important obviously. 87 00:03:43,080 --> 00:03:45,480 If you're not going to get 100% reads, 88 00:03:45,480 --> 00:03:48,330 can you infer those 100% reads, or how can you get that? 89 00:03:48,330 --> 00:03:51,150 And I think that's going to be very important as we go on. 90 00:03:51,150 --> 00:03:53,980 That when we reach this 100% read-- again, 91 00:03:53,980 --> 00:03:55,530 whether it's implicit or explicit-- 92 00:03:55,530 --> 00:03:57,863 you've got to be able to draw some inferences from where 93 00:03:57,863 --> 00:03:58,860 you saw that. 94 00:03:58,860 --> 00:04:02,550 The data at this point is very noisy. 95 00:04:02,550 --> 00:04:06,360 And those of you in the room have seen the data, 96 00:04:06,360 --> 00:04:08,010 there's a lot of noise in that data. 97 00:04:08,010 --> 00:04:11,260 You may have hundreds of reads at a particular reader 98 00:04:11,260 --> 00:04:12,720 [INAUDIBLE] sitting near the reader 99 00:04:12,720 --> 00:04:14,490 and moving in and out of the field, 100 00:04:14,490 --> 00:04:16,260 or maybe it passed back and forth. 101 00:04:16,260 --> 00:04:18,899 Or as a forklift was pulling it down through by the dock doors, 102 00:04:18,899 --> 00:04:20,399 it was reading at every dock door. 103 00:04:20,399 --> 00:04:21,959 It's a lot of noise there. 104 00:04:21,959 --> 00:04:25,560 And we've did early on quite a bit of work 105 00:04:25,560 --> 00:04:28,920 in using such things as neural networks 106 00:04:28,920 --> 00:04:31,470 to try to predict when something might be late, 107 00:04:31,470 --> 00:04:34,890 or when it's outside of its normal schedule, 108 00:04:34,890 --> 00:04:37,050 or using such things as genetic algorithms 109 00:04:37,050 --> 00:04:39,390 to try to pull out those patterns in the data. 110 00:04:39,390 --> 00:04:41,490 And the data is just very noisy. 111 00:04:41,490 --> 00:04:43,320 And we can artificially take that data 112 00:04:43,320 --> 00:04:45,400 and create some good models, but at this point, 113 00:04:45,400 --> 00:04:47,310 we haven't been that successful in creating good models 114 00:04:47,310 --> 00:04:48,270 with the data as it is. 115 00:04:48,270 --> 00:04:49,770 The data has got to get cleaner. 116 00:04:49,770 --> 00:04:52,500 We've got to find a way to clean that data up. 117 00:04:52,500 --> 00:04:54,300 And one of those starts with business rules 118 00:04:54,300 --> 00:04:56,010 for interpretation. 119 00:04:56,010 --> 00:04:57,880 I really feel that we've got to have-- 120 00:04:57,880 --> 00:04:59,963 and there's going to be multiple levels of these-- 121 00:04:59,963 --> 00:05:02,300 there's going to be business rules that help us decipher 122 00:05:02,300 --> 00:05:05,930 what was a good read, what was a bad read, how do we 123 00:05:05,930 --> 00:05:08,570 make that implicit read then if it's not there? 124 00:05:08,570 --> 00:05:10,310 And unfortunately, these business rules, 125 00:05:10,310 --> 00:05:12,320 I think there's going to be some that are global in nature, 126 00:05:12,320 --> 00:05:14,580 but then there's going to be some that vary by industry. 127 00:05:14,580 --> 00:05:15,710 There's going to be some that are going 128 00:05:15,710 --> 00:05:17,293 to be specific to companies, and we've 129 00:05:17,293 --> 00:05:20,000 got to have some type of data architecture 130 00:05:20,000 --> 00:05:23,090 that allows us to specify those business 131 00:05:23,090 --> 00:05:26,735 rules all the way down, maybe even to a product level. 132 00:05:26,735 --> 00:05:28,860 I'm not sure what that architecture looks like yet. 133 00:05:28,860 --> 00:05:29,840 We're still trying to conceptualize 134 00:05:29,840 --> 00:05:30,980 what that thing is. 135 00:05:30,980 --> 00:05:33,500 But we've got to be able to do a better 136 00:05:33,500 --> 00:05:37,340 job of interpreting that data. 137 00:05:37,340 --> 00:05:39,688 Sanjay mentioned yesterday the idea of control charts, 138 00:05:39,688 --> 00:05:42,230 and I think that's going to be important is once we can start 139 00:05:42,230 --> 00:05:44,660 establishing these patterns, and establishing what 140 00:05:44,660 --> 00:05:47,150 these products should be doing, then 141 00:05:47,150 --> 00:05:50,060 we can use this to help us determine when things 142 00:05:50,060 --> 00:05:52,760 aren't operating properly. 143 00:05:52,760 --> 00:05:56,000 The idea of how much data will RFID generate, 144 00:05:56,000 --> 00:05:58,520 there's been a lot of speculation about the terabytes 145 00:05:58,520 --> 00:06:00,630 of data that will be generated. 146 00:06:00,630 --> 00:06:02,930 And again, that goes back to once we 147 00:06:02,930 --> 00:06:05,570 can get this data filtered, and cleansed, and worked on, 148 00:06:05,570 --> 00:06:07,340 I don't think it's going to be that much. 149 00:06:07,340 --> 00:06:08,990 And it's not the quantity so much 150 00:06:08,990 --> 00:06:11,490 as it is the quality of the data that's going to matter. 151 00:06:11,490 --> 00:06:16,970 Storage is cheap, but it's really extracting that quality. 152 00:06:16,970 --> 00:06:19,550 And a couple of issues that were mentioned yesterday-- it's 153 00:06:19,550 --> 00:06:23,640 going to be extremely important-- data consistency. 154 00:06:23,640 --> 00:06:27,320 Walmart provides data via their retail link system. 155 00:06:27,320 --> 00:06:31,490 And Target has their own system, and Kmart has their own system. 156 00:06:31,490 --> 00:06:32,510 I know that-- 157 00:06:32,510 --> 00:06:34,700 I haven't talked to Simon yet, but I 158 00:06:34,700 --> 00:06:37,940 know that I saw something in the news about Target and Walmart 159 00:06:37,940 --> 00:06:41,630 working on a program where there might be some efforts to make 160 00:06:41,630 --> 00:06:42,770 this data more consistent. 161 00:06:42,770 --> 00:06:44,460 It has to be that way. 162 00:06:44,460 --> 00:06:46,820 I mean, we can't have every retailer with their own data 163 00:06:46,820 --> 00:06:48,747 format for this thing to work. 164 00:06:48,747 --> 00:06:50,330 And the same thing goes for suppliers. 165 00:06:50,330 --> 00:06:51,860 And then of course, data integration 166 00:06:51,860 --> 00:06:55,100 into one's own organization, I think we've got a lot of work 167 00:06:55,100 --> 00:06:57,950 there into pulling those into the enterprise systems 168 00:06:57,950 --> 00:06:59,180 that we have in place. 169 00:06:59,180 --> 00:07:01,400 And again, with those things, if you 170 00:07:01,400 --> 00:07:05,390 pull in noisy or dirty data, it's very bad. 171 00:07:05,390 --> 00:07:08,180 So along the bottom, you see there the idea of filtering, 172 00:07:08,180 --> 00:07:10,310 cleanse, integrate, interpret, and understand. 173 00:07:10,310 --> 00:07:12,110 We've got to move toward that model-- 174 00:07:12,110 --> 00:07:14,310 of filtering that data, cleansing that data, 175 00:07:14,310 --> 00:07:17,120 integrating with what we have, interpreting what it means, 176 00:07:17,120 --> 00:07:18,350 and understanding. 177 00:07:18,350 --> 00:07:22,310 And that then will lead to action based upon that data. 178 00:07:22,310 --> 00:07:25,345 Now making the business case, we could 179 00:07:25,345 --> 00:07:26,720 spend the rest of the day talking 180 00:07:26,720 --> 00:07:30,590 about this area and the opportunities that lay within. 181 00:07:30,590 --> 00:07:32,540 We had some questions yesterday. 182 00:07:32,540 --> 00:07:34,820 So in the interest of just keeping it brief, 183 00:07:34,820 --> 00:07:37,160 what I've done is I want to throw out a couple of things 184 00:07:37,160 --> 00:07:38,870 just for you to think about. 185 00:07:38,870 --> 00:07:42,570 And again, this is necessarily very narrow 186 00:07:42,570 --> 00:07:44,840 so that you can understand the scope at which we 187 00:07:44,840 --> 00:07:46,790 could look at this. 188 00:07:46,790 --> 00:07:49,760 When we look at RFID, we can view this 189 00:07:49,760 --> 00:07:51,800 as an incremental technology. 190 00:07:51,800 --> 00:07:55,970 We can go in, and we can tweak what's already there. 191 00:07:55,970 --> 00:07:58,820 And I'm going to kind of look at primarily the store 192 00:07:58,820 --> 00:08:01,020 level, maybe a little bit at the DC level. 193 00:08:01,020 --> 00:08:04,310 But one thing we could do is say, we'll take RFID, 194 00:08:04,310 --> 00:08:05,690 and it will just-- 195 00:08:05,690 --> 00:08:10,130 we'll just use it to make our process a little faster, 196 00:08:10,130 --> 00:08:11,750 a little more efficient, or we'll 197 00:08:11,750 --> 00:08:14,690 use it to make our process a little better. 198 00:08:14,690 --> 00:08:17,660 Maybe our process isn't broke-- it's just bent a little bit, 199 00:08:17,660 --> 00:08:20,180 and we'll use it to just tweak it. 200 00:08:20,180 --> 00:08:21,210 Very incremental. 201 00:08:21,210 --> 00:08:23,250 We're not we're not radically changing anything. 202 00:08:23,250 --> 00:08:25,580 So I just gave some examples there 203 00:08:25,580 --> 00:08:28,160 under the heading of process efficiencies, for example. 204 00:08:28,160 --> 00:08:32,210 Promotions-- we may be good at promotions, 205 00:08:32,210 --> 00:08:35,914 but if we don't get it out to the shelf in a timely manner, 206 00:08:35,914 --> 00:08:37,169 it doesn't matter. 207 00:08:37,169 --> 00:08:39,183 So we can use RFID there. 208 00:08:39,183 --> 00:08:41,600 And I think there's been some-- you probably have all seen 209 00:08:41,600 --> 00:08:42,683 this-- the early studies-- 210 00:08:42,683 --> 00:08:44,540 I know Gillette released some data 211 00:08:44,540 --> 00:08:48,110 from a study they did work with MIT 212 00:08:48,110 --> 00:08:52,760 on some opportunities for improvements just based 213 00:08:52,760 --> 00:08:55,040 upon promotions. 214 00:08:55,040 --> 00:08:56,690 Out of stocks is another one of those. 215 00:08:56,690 --> 00:08:59,810 Again, getting it to the shelf when the customer wants it 216 00:08:59,810 --> 00:09:00,830 in a timely manner. 217 00:09:00,830 --> 00:09:04,420 So just speeding up that process that's already in place. 218 00:09:04,420 --> 00:09:08,210 We can also use it incrementally to fix a process, 219 00:09:08,210 --> 00:09:10,220 or make that process a little better. 220 00:09:10,220 --> 00:09:12,605 Product rotation-- again, we know 221 00:09:12,605 --> 00:09:13,730 how to do product rotation. 222 00:09:13,730 --> 00:09:15,272 It's not a matter of timeliness, it's 223 00:09:15,272 --> 00:09:17,060 a matter of are we doing it correctly. 224 00:09:17,060 --> 00:09:20,240 Well, with RFID, we know what's coming in, what's going out. 225 00:09:20,240 --> 00:09:22,850 We can maybe fix some of those problems. 226 00:09:22,850 --> 00:09:24,290 Better use of merchandisers. 227 00:09:24,290 --> 00:09:28,070 Instead of sending merchandisers to various stores 228 00:09:28,070 --> 00:09:30,650 just at random, or better-- 229 00:09:30,650 --> 00:09:32,630 or worse yet just on a set schedule, 230 00:09:32,630 --> 00:09:34,670 maybe target those merchandisers to where 231 00:09:34,670 --> 00:09:36,470 we see product in the back room, or when 232 00:09:36,470 --> 00:09:40,400 we see an out-of-stock event based upon the RFID data. 233 00:09:40,400 --> 00:09:41,840 Target those merchandisers. 234 00:09:41,840 --> 00:09:44,270 Again, improving that process. 235 00:09:44,270 --> 00:09:48,230 The manual orders that, for example, that Walmart 236 00:09:48,230 --> 00:09:51,050 is doing with RFID. 237 00:09:51,050 --> 00:09:53,083 Trying to restrict those overrides 238 00:09:53,083 --> 00:09:55,250 or those manual orders when we know that something's 239 00:09:55,250 --> 00:09:57,110 in the back room. 240 00:09:57,110 --> 00:10:01,230 Electronic proof of delivery at the DC, for example. 241 00:10:01,230 --> 00:10:03,050 Trying to fix that process where we really 242 00:10:03,050 --> 00:10:04,820 see what's coming into the DC. 243 00:10:04,820 --> 00:10:06,590 And then also I'll put out-of-stocks 244 00:10:06,590 --> 00:10:10,670 under the idea of effectiveness of not only getting out 245 00:10:10,670 --> 00:10:13,850 there as an efficiency-- getting out there in a timely manner-- 246 00:10:13,850 --> 00:10:17,770 but also improving that process. 247 00:10:17,770 --> 00:10:22,025 There was some data released earlier in 2005 from Walmart 248 00:10:22,025 --> 00:10:24,740 that suggested that 1 out of 12 products 249 00:10:24,740 --> 00:10:29,810 was actually making it from the pick list to the shelf. 250 00:10:29,810 --> 00:10:31,850 And somebody might have to correct that stat 251 00:10:31,850 --> 00:10:33,110 if it's not entirely correct. 252 00:10:33,110 --> 00:10:35,500 But something on a busy Saturday, 253 00:10:35,500 --> 00:10:38,000 by the time it got on the pick list and then got to a shelf, 254 00:10:38,000 --> 00:10:38,730 1 out of 12. 255 00:10:38,730 --> 00:10:43,580 Well, that that process can be helped with RFID. 256 00:10:43,580 --> 00:10:47,383 Now again-- so if you view it as an incremental technology-- 257 00:10:47,383 --> 00:10:48,800 and some companies are doing that. 258 00:10:48,800 --> 00:10:51,260 They look at it and they say, OK, RFID 259 00:10:51,260 --> 00:10:54,800 is just going to help us improve the speed of our process, 260 00:10:54,800 --> 00:10:57,050 or help us tweak or process a little bit. 261 00:10:57,050 --> 00:10:59,720 Others are viewing it more as a radical or disruptive 262 00:10:59,720 --> 00:11:00,800 technology. 263 00:11:00,800 --> 00:11:03,020 And that is giving us an opportunity 264 00:11:03,020 --> 00:11:05,720 to use RFID as a process enabler. 265 00:11:05,720 --> 00:11:08,930 Let's go in and create new ways of doing business 266 00:11:08,930 --> 00:11:11,240 that were never before possible using 267 00:11:11,240 --> 00:11:13,790 RFID as that technology that drives that. 268 00:11:13,790 --> 00:11:16,310 And just give you some examples there. 269 00:11:16,310 --> 00:11:20,900 It may be that we could use RFID to radically change 270 00:11:20,900 --> 00:11:24,792 the way that retail stores stock their sales. 271 00:11:24,792 --> 00:11:26,750 I don't know what that process might look like, 272 00:11:26,750 --> 00:11:28,910 but that might be a possibility. 273 00:11:28,910 --> 00:11:30,620 Obviously, as we move on down the line, 274 00:11:30,620 --> 00:11:33,530 the idea of the contactless checkout. 275 00:11:33,530 --> 00:11:36,800 That would radically change that process 276 00:11:36,800 --> 00:11:38,810 of going up and handing your stuff off 277 00:11:38,810 --> 00:11:40,962 to a cashier that swipes your items 278 00:11:40,962 --> 00:11:42,170 and puts it back in the cart. 279 00:11:42,170 --> 00:11:44,510 It radically changes that. 280 00:11:44,510 --> 00:11:46,220 Sanjay mentioned yesterday the idea 281 00:11:46,220 --> 00:11:49,250 that paper scanners radically changing 282 00:11:49,250 --> 00:11:51,800 that relationship between suppliers and retailers, 283 00:11:51,800 --> 00:11:56,300 changing that supply chain, where we get direct store 284 00:11:56,300 --> 00:11:59,240 deliveries, and the retailer simply 285 00:11:59,240 --> 00:12:02,240 acts as a facilitator or a broker of those goods 286 00:12:02,240 --> 00:12:03,410 until they're sold. 287 00:12:03,410 --> 00:12:05,740 That's a radical change. 288 00:12:05,740 --> 00:12:07,910 But what I think that we're seeing-- 289 00:12:07,910 --> 00:12:10,010 and if you start looking at the case studies 290 00:12:10,010 --> 00:12:14,060 closely, what you'll find is that some companies 291 00:12:14,060 --> 00:12:15,980 are treating it as an incremental, 292 00:12:15,980 --> 00:12:18,512 and necessarily so. 293 00:12:18,512 --> 00:12:19,970 There are many companies-- and I've 294 00:12:19,970 --> 00:12:21,553 worked with several the suppliers that 295 00:12:21,553 --> 00:12:24,980 are very, very, very good at what they do. 296 00:12:24,980 --> 00:12:27,770 All the low hanging fruit has already been picked. 297 00:12:27,770 --> 00:12:31,120 So you have to look hard to find that incremental value. 298 00:12:31,120 --> 00:12:34,050 Now that doesn't mean they can't use it as a radical technology, 299 00:12:34,050 --> 00:12:36,710 but they first look for that incremental change. 300 00:12:36,710 --> 00:12:38,780 Other companies, however, have actually 301 00:12:38,780 --> 00:12:43,730 purposely used RFID as a way to radically change 302 00:12:43,730 --> 00:12:44,412 their business. 303 00:12:44,412 --> 00:12:46,370 They weren't very good at what they were doing, 304 00:12:46,370 --> 00:12:50,720 and RFID then actually becomes an excuse to really change 305 00:12:50,720 --> 00:12:52,370 what they're doing. 306 00:12:52,370 --> 00:12:55,400 And as with most things, the higher 307 00:12:55,400 --> 00:12:57,560 the risk, the higher the return. 308 00:12:57,560 --> 00:13:03,590 So with those following that radical or disruptive path, 309 00:13:03,590 --> 00:13:05,930 the opportunity for return is greater, 310 00:13:05,930 --> 00:13:09,290 but the risk is higher that it won't work. 311 00:13:09,290 --> 00:13:11,930 Now the third element that we have to keep in mind 312 00:13:11,930 --> 00:13:17,365 here is who are the beneficiaries of these changes? 313 00:13:17,365 --> 00:13:19,490 It could be the retailer, it could be the supplier, 314 00:13:19,490 --> 00:13:21,230 it could be the logistics provider, 315 00:13:21,230 --> 00:13:23,570 it could be the consumer. 316 00:13:23,570 --> 00:13:29,210 Now we did an out-of-stock study working with Walmart, 317 00:13:29,210 --> 00:13:36,290 and we necessarily looked at one particular area that would 318 00:13:36,290 --> 00:13:39,200 provide benefit to several beneficiaries-- 319 00:13:39,200 --> 00:13:43,890 look at a fairly constrained or fairly narrow area-- 320 00:13:43,890 --> 00:13:48,350 and that was how we kind of tweak 321 00:13:48,350 --> 00:13:51,620 that out-of-stock process to make it just 322 00:13:51,620 --> 00:13:54,560 a little bit better using RFID. 323 00:13:54,560 --> 00:13:57,670 And in this case, creating those automatic pick 324 00:13:57,670 --> 00:14:00,830 lists for them to go to the back room and find that product, 325 00:14:00,830 --> 00:14:02,080 and take it to the shelf. 326 00:14:02,080 --> 00:14:04,040 So we tweaked it just a little bit. 327 00:14:04,040 --> 00:14:08,480 And so I wanted to put it in context of what we studied. 328 00:14:08,480 --> 00:14:11,510 And many of you I know have seen the white paper 329 00:14:11,510 --> 00:14:12,680 that was released. 330 00:14:12,680 --> 00:14:16,410 Because it's important that you put this thing in perspective. 331 00:14:16,410 --> 00:14:17,870 Keep in mind that what we looked at 332 00:14:17,870 --> 00:14:20,300 was an incremental use of the technology 333 00:14:20,300 --> 00:14:23,240 in a very narrow domain. 334 00:14:23,240 --> 00:14:24,930 It did help. 335 00:14:24,930 --> 00:14:27,410 I mean, out-of-stocks can help the supplier, 336 00:14:27,410 --> 00:14:30,180 it can help the retailer, it can help the consumer. 337 00:14:30,180 --> 00:14:32,950 So the beneficiary side was great, 338 00:14:32,950 --> 00:14:37,650 but the fact that we found changes 339 00:14:37,650 --> 00:14:42,210 that we could attribute to RFID tells us 340 00:14:42,210 --> 00:14:45,480 a lot, because we were looking at a very narrow thing. 341 00:14:45,480 --> 00:14:47,910 Now to me, that's extremely encouraging because if you've 342 00:14:47,910 --> 00:14:50,490 narrowed it down to this much, and you still 343 00:14:50,490 --> 00:14:55,140 found a fairly big difference, then what 344 00:14:55,140 --> 00:14:56,370 if we expand it on out? 345 00:14:58,990 --> 00:15:00,450 I think the possibilities-- 346 00:15:00,450 --> 00:15:06,720 I think we've only set a very, very small bar to clear, 347 00:15:06,720 --> 00:15:10,530 and we cleared it easily, but there's a lot more 348 00:15:10,530 --> 00:15:12,240 there that we can get at. 349 00:15:12,240 --> 00:15:15,120 And also keep in mind that this idea of incremental 350 00:15:15,120 --> 00:15:17,730 versus radical, it's going to vary by the company. 351 00:15:17,730 --> 00:15:19,800 We're looking at a very abbreviated supply 352 00:15:19,800 --> 00:15:21,870 chain at this point. 353 00:15:21,870 --> 00:15:24,960 This is from the DC basically to the back room of the store. 354 00:15:24,960 --> 00:15:28,080 And so far, the logistics segment 355 00:15:28,080 --> 00:15:30,850 has been largely overlooked. 356 00:15:30,850 --> 00:15:32,620 And you notice that they're listed there, 357 00:15:32,620 --> 00:15:34,397 but there's not a lot going on when 358 00:15:34,397 --> 00:15:35,980 we talk about the supply chain and how 359 00:15:35,980 --> 00:15:37,330 it's involving logistics arm. 360 00:15:40,370 --> 00:15:44,960 And just very quickly on the out-of-stocks, 361 00:15:44,960 --> 00:15:48,470 keeping in perspective of where that was on that chart-- 362 00:15:48,470 --> 00:15:52,130 the fact that we were able to find improvements between pre 363 00:15:52,130 --> 00:15:55,940 and post RFID, and then and in between the pilot and control 364 00:15:55,940 --> 00:15:58,490 stores, we found those differences 365 00:15:58,490 --> 00:16:00,560 even though we were constraining ourselves 366 00:16:00,560 --> 00:16:03,770 to an incremental change in a very small area. 367 00:16:06,790 --> 00:16:09,550 That just gives you some things to think about there. 368 00:16:09,550 --> 00:16:11,260 I want to very quickly run through-- 369 00:16:11,260 --> 00:16:14,890 also it's important we're doing the research, 370 00:16:14,890 --> 00:16:19,660 but we're also teaching students and others about RFID. 371 00:16:19,660 --> 00:16:21,460 We're trying to turn out people. 372 00:16:21,460 --> 00:16:24,190 [INAUDIBLE] said last year-- 373 00:16:24,190 --> 00:16:27,370 the CIO of Kimberly Clark said that there's 374 00:16:27,370 --> 00:16:29,320 such a dearth of experience out there 375 00:16:29,320 --> 00:16:31,000 that if somebody walks by a reader 376 00:16:31,000 --> 00:16:36,070 and says RFID and not RI-FID, that makes them an RFID expert. 377 00:16:36,070 --> 00:16:39,400 Well, we're trying to stamp out some of that ignorance 378 00:16:39,400 --> 00:16:40,820 by training people. 379 00:16:40,820 --> 00:16:44,110 And so we've got dedicated courses in the business 380 00:16:44,110 --> 00:16:46,480 school, which I personally teach, 381 00:16:46,480 --> 00:16:49,115 where we have students from across the college 382 00:16:49,115 --> 00:16:50,740 and graduate students as well-- so it's 383 00:16:50,740 --> 00:16:52,870 undergraduate and graduate. 384 00:16:52,870 --> 00:16:55,050 They're doing live projects for companies. 385 00:16:55,050 --> 00:16:57,550 We've got dedicated courses in computer science and computer 386 00:16:57,550 --> 00:16:59,230 engineering, and then interwoven into a lot 387 00:16:59,230 --> 00:17:00,105 of different courses. 388 00:17:00,105 --> 00:17:02,440 So we've got about, this semester-- 389 00:17:02,440 --> 00:17:05,200 our last semester, we had about 80 students 390 00:17:05,200 --> 00:17:08,710 involved in RFID in some form or fashion. 391 00:17:08,710 --> 00:17:11,800 It's over 100 this semester. 392 00:17:11,800 --> 00:17:14,770 We also provide testing and training services 393 00:17:14,770 --> 00:17:16,339 to the industry. 394 00:17:16,339 --> 00:17:19,540 One of the things that we do is we help companies 395 00:17:19,540 --> 00:17:22,060 determine tag and tag placement on their products 396 00:17:22,060 --> 00:17:26,440 so that it's ready to go through an RFID enabled supply chain. 397 00:17:26,440 --> 00:17:28,700 And we started coupling our testing with training. 398 00:17:28,700 --> 00:17:31,090 One of the things we found out was that people would just 399 00:17:31,090 --> 00:17:33,730 send us a box of their product or a pallet of their product, 400 00:17:33,730 --> 00:17:35,500 and say here, help me figure this out, 401 00:17:35,500 --> 00:17:36,880 but they didn't understand RFID. 402 00:17:36,880 --> 00:17:42,850 And our most successful projects were when they actually came 403 00:17:42,850 --> 00:17:45,310 in and spent time with us going through the testing 404 00:17:45,310 --> 00:17:46,570 and understanding RFID. 405 00:17:46,570 --> 00:17:49,457 So we've actually started coupling that now formally 406 00:17:49,457 --> 00:17:51,040 where we bring the companies in-- they 407 00:17:51,040 --> 00:17:54,670 spend a couple of days with us learning about RFID as we 408 00:17:54,670 --> 00:17:57,052 test their products. 409 00:17:57,052 --> 00:17:59,260 Our lab facility there at the University of Arkansas, 410 00:17:59,260 --> 00:18:03,340 we're actually off campus a few miles in a working warehouse 411 00:18:03,340 --> 00:18:04,600 and manufacturing environment. 412 00:18:04,600 --> 00:18:08,090 We have about 8,000 square feet in Hanna's Candle company, 413 00:18:08,090 --> 00:18:10,840 which they manufacture, and then their distribution center 414 00:18:10,840 --> 00:18:12,720 is there as well. 415 00:18:12,720 --> 00:18:15,850 And that's-- unfortunately, it is in the distribution center 416 00:18:15,850 --> 00:18:18,350 part, so there is no control over the temperature, 417 00:18:18,350 --> 00:18:20,800 so the temperature inside is plus or minus 10 degrees what 418 00:18:20,800 --> 00:18:22,300 it is outside. 419 00:18:22,300 --> 00:18:24,190 So we also have-- 420 00:18:24,190 --> 00:18:26,230 when we have to test stuff in the cold chain, 421 00:18:26,230 --> 00:18:29,350 we've got about a 4,500 square foot facility 422 00:18:29,350 --> 00:18:32,710 in Zero Mountain, which is a cold storage facility. 423 00:18:32,710 --> 00:18:34,360 And we've got two labs there-- one 424 00:18:34,360 --> 00:18:38,440 at 36 degrees, and one at minus 10 so we can test stuff there. 425 00:18:38,440 --> 00:18:40,630 Our lab is set up to replicate really everything 426 00:18:40,630 --> 00:18:43,180 that a box sees at this point through the previous supply 427 00:18:43,180 --> 00:18:44,380 chain. 428 00:18:44,380 --> 00:18:47,500 And we are one of only four labs at this point 429 00:18:47,500 --> 00:18:51,130 that's accredited by EPCglobal as a testing facility, 430 00:18:51,130 --> 00:18:53,720 and the only academic lab in the world. 431 00:18:53,720 --> 00:18:56,140 And just to give you some quick pictures here of our lab-- 432 00:18:56,140 --> 00:18:58,450 and I've got 2 minutes to wrap up-- 433 00:18:58,450 --> 00:19:02,140 that's the outside of our lab-- a truck backed up to our dock. 434 00:19:02,140 --> 00:19:04,900 That's the inside of the lab looking out that that same dock 435 00:19:04,900 --> 00:19:08,290 door view from our lab the conveyor 436 00:19:08,290 --> 00:19:10,960 system that we have in there. 437 00:19:10,960 --> 00:19:13,540 We actually are fortunate to have a conveyor system that 438 00:19:13,540 --> 00:19:19,000 was custom designed and built for our lab that replicates 439 00:19:19,000 --> 00:19:22,180 sorting, and merging, and up to 700 feet per minute, 440 00:19:22,180 --> 00:19:24,070 the whole works. 441 00:19:24,070 --> 00:19:28,900 And then pallet rack and back room storage facilities, 442 00:19:28,900 --> 00:19:32,740 forklifts, et cetera. 443 00:19:32,740 --> 00:19:35,800 At this point, I believe the next on the agenda 444 00:19:35,800 --> 00:19:39,640 is Simon, so I'll turn it over to you Simon. 445 00:19:39,640 --> 00:19:40,390 And let me-- 446 00:20:02,180 --> 00:20:04,950 SIMON LANGFORD: Thanks, Bill, and good morning, everybody. 447 00:20:04,950 --> 00:20:07,100 I want to touch on the opportunities and issues 448 00:20:07,100 --> 00:20:10,460 that we see in the retail supply chain. 449 00:20:10,460 --> 00:20:14,690 Before I do that, just to step back a little bit and see what 450 00:20:14,690 --> 00:20:17,820 we've all accomplished in the last few years. 451 00:20:17,820 --> 00:20:24,200 So in 2001, 2002, we had the auto-ID center field trials, 452 00:20:24,200 --> 00:20:28,130 and installation points around the dock door, for instance, 453 00:20:28,130 --> 00:20:29,840 took hours to install, and probably 454 00:20:29,840 --> 00:20:34,190 minutes to destroy, or simply to go move those things. 455 00:20:34,190 --> 00:20:36,020 So it wasn't scalable, wasn't deployable, 456 00:20:36,020 --> 00:20:38,420 and certainly wasn't supportable. 457 00:20:38,420 --> 00:20:41,150 But a lot of learning came out of that for us 458 00:20:41,150 --> 00:20:43,010 all then to focus on what we needed 459 00:20:43,010 --> 00:20:45,130 for deployable solutions. 460 00:20:45,130 --> 00:20:47,630 And the one key message that we were putting out at the time 461 00:20:47,630 --> 00:20:50,820 is that they should be future proofed as far as possible, 462 00:20:50,820 --> 00:20:53,750 knowing that Gen 2 was on the horizon-- 463 00:20:53,750 --> 00:20:58,460 that we wanted to deploy things that were software upgradeable. 464 00:20:58,460 --> 00:21:01,730 And in 2004, then we really stepped up a notch 465 00:21:01,730 --> 00:21:04,400 to drive for mobile solutions, whether that be 466 00:21:04,400 --> 00:21:06,900 handheld solutions, and particularly 467 00:21:06,900 --> 00:21:10,610 solutions, which is important both to the retailer and a lot 468 00:21:10,610 --> 00:21:12,170 of suppliers. 469 00:21:12,170 --> 00:21:14,430 A lot of those things are still in the early stages, 470 00:21:14,430 --> 00:21:18,600 especially around mobile solutions. 471 00:21:18,600 --> 00:21:21,860 So our current situation is we have robust fixed reader 472 00:21:21,860 --> 00:21:24,560 solutions allowing us to deploy up 473 00:21:24,560 --> 00:21:28,160 to 20 read points in a store in a matter of hours-- 474 00:21:28,160 --> 00:21:29,880 in a couple of hours. 475 00:21:29,880 --> 00:21:33,500 So taking that time down from days to hours, 476 00:21:33,500 --> 00:21:36,590 that reduces the cost of deployment. 477 00:21:36,590 --> 00:21:38,150 So the cost of deployment isn't just 478 00:21:38,150 --> 00:21:40,490 around readers and antenna. 479 00:21:40,490 --> 00:21:44,270 A lot of the cost is in cabling and actual installation 480 00:21:44,270 --> 00:21:46,328 of the equipment. 481 00:21:46,328 --> 00:21:47,620 So it's a little bit like tags. 482 00:21:47,620 --> 00:21:50,860 It's not just the IC chip that we can take cost out of, 483 00:21:50,860 --> 00:21:53,550 it's the whole process. 484 00:21:53,550 --> 00:21:56,610 Driving for common operating systems 485 00:21:56,610 --> 00:21:58,860 so that we can support it centrally-- 486 00:21:58,860 --> 00:22:04,133 maintain the robustness of that system. 487 00:22:04,133 --> 00:22:05,550 We're starting to deploy handhelds 488 00:22:05,550 --> 00:22:07,620 in the next few months. 489 00:22:07,620 --> 00:22:10,130 So getting the first mobile devices out there. 490 00:22:10,130 --> 00:22:12,680 And I think that's when our store associates will start 491 00:22:12,680 --> 00:22:15,500 to see some of those transformational changes 492 00:22:15,500 --> 00:22:17,600 rather than just the iterative process changes 493 00:22:17,600 --> 00:22:20,960 that we've had out there in the store so far. 494 00:22:20,960 --> 00:22:23,150 Things that they can actually touch and feel and see 495 00:22:23,150 --> 00:22:24,830 the difference with RFID. 496 00:22:24,830 --> 00:22:26,540 So our fixed rate points are collecting 497 00:22:26,540 --> 00:22:30,650 data in the background, and suggesting items to pick. 498 00:22:30,650 --> 00:22:34,070 But really, to a store associate today, what is RFID doing? 499 00:22:34,070 --> 00:22:34,760 They don't know. 500 00:22:34,760 --> 00:22:36,950 They don't see that as visible. 501 00:22:36,950 --> 00:22:39,470 Sure, they're picking more product 502 00:22:39,470 --> 00:22:42,170 and moving it out to the floor quicker, 503 00:22:42,170 --> 00:22:45,470 but once we get these mobile devices in their hands, 504 00:22:45,470 --> 00:22:47,540 then that will help them home in on where 505 00:22:47,540 --> 00:22:49,340 that product is, and really start 506 00:22:49,340 --> 00:22:52,300 to streamline their process. 507 00:22:52,300 --> 00:22:55,990 We're very close to deploying the first forklift solution 508 00:22:55,990 --> 00:22:59,680 in our enterprise to read pallet tags and location tags, 509 00:22:59,680 --> 00:23:03,190 so we can have a pallet locating system in our Sam's Club 510 00:23:03,190 --> 00:23:05,300 operation, for example. 511 00:23:05,300 --> 00:23:08,200 Taking that learning then, we can then 512 00:23:08,200 --> 00:23:11,090 take that to our distribution centers 513 00:23:11,090 --> 00:23:15,260 to see how we can use location tracking, and putting pallets 514 00:23:15,260 --> 00:23:18,710 away and dropping them down, and start to streamline processes 515 00:23:18,710 --> 00:23:20,800 there as we move forward in the future. 516 00:23:24,380 --> 00:23:26,720 But even those forklift solutions 517 00:23:26,720 --> 00:23:28,740 are still at the early stages. 518 00:23:28,740 --> 00:23:31,500 So we can read a pallet today. 519 00:23:31,500 --> 00:23:34,890 In the future, we need to be able to read cases-- 520 00:23:34,890 --> 00:23:37,860 or the same amount of cases we do today 521 00:23:37,860 --> 00:23:42,660 on a dock door from that pallet read on the forklift. 522 00:23:42,660 --> 00:23:46,140 That way, we can start to eliminate deploying readers 523 00:23:46,140 --> 00:23:50,280 around dock doors, and reduce our overall costs, 524 00:23:50,280 --> 00:23:54,050 and just have those readers on forklifts. 525 00:23:54,050 --> 00:23:55,490 But at the very early stages-- 526 00:23:55,490 --> 00:23:59,710 the infant stages of wearable solutions. 527 00:23:59,710 --> 00:24:02,830 So whether that be something that an associate would wear 528 00:24:02,830 --> 00:24:06,880 on the belt or within a vest, and the system is 529 00:24:06,880 --> 00:24:10,970 reading in the background, and talking back to them, 530 00:24:10,970 --> 00:24:13,870 and giving them work to do. 531 00:24:13,870 --> 00:24:18,360 And as Bill mentioned, Gen 2 is starting to roll out. 532 00:24:18,360 --> 00:24:20,310 We're enabled in our supply chain 533 00:24:20,310 --> 00:24:25,320 and starting to receive product on Gen 2 tags. 534 00:24:25,320 --> 00:24:26,880 And prices are falling. 535 00:24:26,880 --> 00:24:31,310 Tag prices are falling through the floor. 536 00:24:31,310 --> 00:24:33,890 So what does all that technology deliver so far? 537 00:24:33,890 --> 00:24:35,960 What are the benefits of that? 538 00:24:35,960 --> 00:24:37,870 So it's allowed the first sort of automation 539 00:24:37,870 --> 00:24:41,770 of tasks around picklists and manual order controls, 540 00:24:41,770 --> 00:24:45,080 and associates to work more efficiently. 541 00:24:45,080 --> 00:24:46,810 That's improved our customer service 542 00:24:46,810 --> 00:24:51,060 and our offering of product on the shelf at the right time. 543 00:24:51,060 --> 00:24:54,250 It's really taken the theory out of the lab environment 544 00:24:54,250 --> 00:24:56,000 into the real world. 545 00:24:56,000 --> 00:24:57,910 And I think once you take that step, that's 546 00:24:57,910 --> 00:25:02,070 when a lot of the real learning comes about. 547 00:25:02,070 --> 00:25:04,680 And Bill mentioned the study that they performed 548 00:25:04,680 --> 00:25:07,350 on our first changes, where out-of-stocks 549 00:25:07,350 --> 00:25:09,520 were reduced by 16%. 550 00:25:09,520 --> 00:25:12,840 So you can see from a non-RFID environment 551 00:25:12,840 --> 00:25:15,000 and the different store formats here. 552 00:25:15,000 --> 00:25:18,010 To a partial implementation that we did, 553 00:25:18,010 --> 00:25:20,890 we had some caps on the number of auto-picks 554 00:25:20,890 --> 00:25:23,590 that we've actually suggested to our associates. 555 00:25:23,590 --> 00:25:26,600 And then to a full-blown RFID solution on those products 556 00:25:26,600 --> 00:25:27,850 that were enabled at the time. 557 00:25:31,170 --> 00:25:36,790 Measuring the out-of-stocks in the control stores versus-- 558 00:25:36,790 --> 00:25:40,440 the pallet stores versus control stores, those RFID stocks 559 00:25:40,440 --> 00:25:44,520 performed 63% better in stocking the shelves than the control 560 00:25:44,520 --> 00:25:47,030 stores did. 561 00:25:47,030 --> 00:25:49,730 And within the same store, within the pilot store, 562 00:25:49,730 --> 00:25:53,060 looking at tagged product versus non-tagged product, 563 00:25:53,060 --> 00:25:56,970 we saw those replaced three times faster-- 564 00:25:56,970 --> 00:25:59,750 those products with RFID tags. 565 00:25:59,750 --> 00:26:04,400 So as Bill said, those first iterative process changes 566 00:26:04,400 --> 00:26:07,818 were starting to deliver dramatic results on the tag 567 00:26:07,818 --> 00:26:09,110 product we had in those stores. 568 00:26:12,090 --> 00:26:14,330 So what about the issues and opportunities? 569 00:26:14,330 --> 00:26:19,120 Well, the issues remain the same as they did four years ago, 570 00:26:19,120 --> 00:26:20,440 10 years ago. 571 00:26:20,440 --> 00:26:24,470 It's all about data accuracy and real time data. 572 00:26:24,470 --> 00:26:28,940 Data accuracy drives both availability of product 573 00:26:28,940 --> 00:26:32,020 in the whole supply chain. 574 00:26:32,020 --> 00:26:35,350 The speed of that merchandise flowing through the supply 575 00:26:35,350 --> 00:26:39,240 chain, and the amount of inventory we have to hold, 576 00:26:39,240 --> 00:26:41,495 it has a direct relation to cost. 577 00:26:44,050 --> 00:26:48,280 And as Bill said, it's important to see how we use that data. 578 00:26:48,280 --> 00:26:50,720 That we don't get swamped with data. 579 00:26:50,720 --> 00:26:55,810 We're using it-- it's actionable for store associates, 580 00:26:55,810 --> 00:27:00,370 for replenishment associates, and for our suppliers. 581 00:27:00,370 --> 00:27:04,740 But it opens up a new world of granularity, new windows 582 00:27:04,740 --> 00:27:06,840 that we can see into the supply chain 583 00:27:06,840 --> 00:27:10,690 that we just didn't realize before. 584 00:27:10,690 --> 00:27:13,300 We're starting to drive efficiencies 585 00:27:13,300 --> 00:27:16,360 around manual processes, but lots of inefficiencies 586 00:27:16,360 --> 00:27:18,436 still exist today. 587 00:27:18,436 --> 00:27:22,020 And a lot of changes will only occur [INAUDIBLE] 588 00:27:22,020 --> 00:27:23,760 distribution center once we start 589 00:27:23,760 --> 00:27:25,770 to get a critical mass of product flowing 590 00:27:25,770 --> 00:27:29,280 through those facilities. 591 00:27:29,280 --> 00:27:31,950 We've got a big opportunity to reduce lead times 592 00:27:31,950 --> 00:27:33,090 in the whole supply chain. 593 00:27:36,610 --> 00:27:38,920 So in the short-term, as I've mentioned, 594 00:27:38,920 --> 00:27:40,860 we're rolling out handhelds. 595 00:27:40,860 --> 00:27:44,040 But the choice of handhelds today is limited. 596 00:27:44,040 --> 00:27:48,440 The functionality of those handhelds is limited. 597 00:27:48,440 --> 00:27:55,260 We need to move to wearable mobile devices, systems 598 00:27:55,260 --> 00:27:58,470 that help us fast track product to the sales floor. 599 00:27:58,470 --> 00:28:02,190 It's always that least 50 yards in the store 600 00:28:02,190 --> 00:28:04,720 where we're most inefficient. 601 00:28:04,720 --> 00:28:08,220 So how do we get [INAUDIBLE] one-way stock? 602 00:28:08,220 --> 00:28:11,520 It comes in, goes straight to the sales floor to the shelf, 603 00:28:11,520 --> 00:28:14,740 it's put on the shelf, and the box is thrown away. 604 00:28:14,740 --> 00:28:17,670 We don't get this double, triple, quadruple handling 605 00:28:17,670 --> 00:28:22,270 back and forth from the back room to the sales floor. 606 00:28:22,270 --> 00:28:23,890 Bill mentioned about execution tools 607 00:28:23,890 --> 00:28:27,730 for promotions, new item launches. 608 00:28:27,730 --> 00:28:31,600 So how can we work more efficiently in that respect? 609 00:28:31,600 --> 00:28:34,990 And that's not just a supplier's responsibility 610 00:28:34,990 --> 00:28:36,970 or a retailer's responsibility. 611 00:28:36,970 --> 00:28:42,360 It's how do we collaborate together and make that work? 612 00:28:42,360 --> 00:28:44,510 So driving execution. 613 00:28:44,510 --> 00:28:47,570 As I mentioned, the new windows and the new data 614 00:28:47,570 --> 00:28:51,000 streams that RFID gives us. 615 00:28:51,000 --> 00:28:55,490 How do we use that to drive that execution? 616 00:28:55,490 --> 00:28:57,490 So in the real world today, people 617 00:28:57,490 --> 00:28:59,857 tick boxes and make reports look pretty, 618 00:28:59,857 --> 00:29:01,690 and say they've done tasks when they may not 619 00:29:01,690 --> 00:29:03,010 have done that task. 620 00:29:03,010 --> 00:29:06,790 RFID gives us that ability to see whether that task has 621 00:29:06,790 --> 00:29:07,960 been done. 622 00:29:07,960 --> 00:29:10,660 Whether that new modular has been laid out 623 00:29:10,660 --> 00:29:12,520 on the shelf, whether those new items 624 00:29:12,520 --> 00:29:15,250 have made it out to the shelf without anybody 625 00:29:15,250 --> 00:29:17,620 having to go in and take a check sheet. 626 00:29:21,060 --> 00:29:24,320 Bill mentioned electronic proof of delivery. 627 00:29:24,320 --> 00:29:28,150 Big efficiency gain for both the supplier and retailer. 628 00:29:28,150 --> 00:29:32,510 So how do we make that happen across all retailers, 629 00:29:32,510 --> 00:29:37,850 all suppliers, with a common understanding? 630 00:29:37,850 --> 00:29:40,355 I mentioned about a pilot locator system for Sam's. 631 00:29:42,890 --> 00:29:48,000 The benefits we're starting to see today, as Bill mentioned, 632 00:29:48,000 --> 00:29:51,620 it's a very small sort of subset of products and area 633 00:29:51,620 --> 00:29:53,700 that we've started to change. 634 00:29:53,700 --> 00:29:56,670 So that is truly the tip of the iceberg. 635 00:29:56,670 --> 00:30:00,240 But many benefits are reliant on the technology continuing 636 00:30:00,240 --> 00:30:04,190 to develop and mature, and reducing the cost of deployment 637 00:30:04,190 --> 00:30:06,690 so we start to get that critical mass of product 638 00:30:06,690 --> 00:30:08,990 flowing through. 639 00:30:08,990 --> 00:30:13,130 Gen 2 is showing step change in performance. 640 00:30:13,130 --> 00:30:15,230 A real step change. 641 00:30:15,230 --> 00:30:17,950 And all us end users, when we came together, 642 00:30:17,950 --> 00:30:21,520 we all said, well, we need a global tag. 643 00:30:21,520 --> 00:30:24,880 But there's no point in developing this tag if it's 644 00:30:24,880 --> 00:30:26,660 just an iterative process. 645 00:30:26,660 --> 00:30:28,240 We need a real step change. 646 00:30:28,240 --> 00:30:31,810 I'm pleased to say Gen 2 is delivering that today. 647 00:30:31,810 --> 00:30:34,888 But we still need to drive for cheaper, faster, better, 648 00:30:34,888 --> 00:30:35,680 and added features. 649 00:30:38,890 --> 00:30:42,690 So what are some of the barriers to continued adoption 650 00:30:42,690 --> 00:30:45,270 and accelerating adoption? 651 00:30:45,270 --> 00:30:46,890 I think if you ask most suppliers, 652 00:30:46,890 --> 00:30:52,520 tag cost is the primary barrier. 653 00:30:52,520 --> 00:30:56,150 Many process efficiencies require that critical mass 654 00:30:56,150 --> 00:30:58,270 I've spoken about. 655 00:30:58,270 --> 00:31:03,280 And we need to be smart of how we introduce RFID into areas 656 00:31:03,280 --> 00:31:06,240 so we're not running dual processes, 657 00:31:06,240 --> 00:31:09,490 and turning people's worlds upside down. 658 00:31:09,490 --> 00:31:14,690 That's what we started to do with our picking list. 659 00:31:14,690 --> 00:31:17,450 So it's behind the scenes, and it's just dovetailing 660 00:31:17,450 --> 00:31:19,890 with the current process. 661 00:31:19,890 --> 00:31:23,720 And as we move forward, we need to minimize impact 662 00:31:23,720 --> 00:31:27,140 on associates throughout the supply chain 663 00:31:27,140 --> 00:31:29,300 to enable us to execute and to get buy-in. 664 00:31:32,040 --> 00:31:34,430 So what are the kind of things that we're looking-- 665 00:31:34,430 --> 00:31:37,650 that we need to work on and we need to collaborate on? 666 00:31:37,650 --> 00:31:42,500 And it's those transformational changes that Bill spoke about. 667 00:31:42,500 --> 00:31:44,430 So sensor tags. 668 00:31:44,430 --> 00:31:47,300 Seems like we've been talking about culture and compliance, 669 00:31:47,300 --> 00:31:52,316 and sensor tags since the year dot. 670 00:31:52,316 --> 00:31:56,060 And it's not really becoming a reality yet. 671 00:31:56,060 --> 00:31:58,585 So you look at semi-passive tags, 672 00:31:58,585 --> 00:32:01,570 and they're far too expensive currently 673 00:32:01,570 --> 00:32:06,310 to put into a deployable solution. 674 00:32:06,310 --> 00:32:08,800 So we need to move that up a notch. 675 00:32:08,800 --> 00:32:11,020 We'll start piloting some proof of concepts 676 00:32:11,020 --> 00:32:13,930 this year, again, just to show everybody 677 00:32:13,930 --> 00:32:16,330 what the benefit would be. 678 00:32:16,330 --> 00:32:19,600 But looking at passive temperature sensing. 679 00:32:19,600 --> 00:32:22,382 So what is a true real business case? 680 00:32:22,382 --> 00:32:26,520 Is that we want to, with a passive sensor tag, 681 00:32:26,520 --> 00:32:29,520 read that temperature as it passes certain read points? 682 00:32:29,520 --> 00:32:33,860 Or in a trailer that may have RF equipment 683 00:32:33,860 --> 00:32:37,040 on board already for things like GPS that we can tie into. 684 00:32:39,710 --> 00:32:42,150 Theft prevention systems. 685 00:32:42,150 --> 00:32:46,020 A lot of work was done on this through the [INAUDIBLE] center 686 00:32:46,020 --> 00:32:50,155 in the labs probably four or five years ago. 687 00:32:50,155 --> 00:32:56,480 But how do we really replace AIS systems, 688 00:32:56,480 --> 00:33:01,440 because that will start to reduce costs in that aspect. 689 00:33:01,440 --> 00:33:07,710 We can't have AIS and RFID tags on the same product, 690 00:33:07,710 --> 00:33:10,050 because that's just increasing costs. 691 00:33:10,050 --> 00:33:12,760 So how do we get down to 1 solution 692 00:33:12,760 --> 00:33:15,660 that will achieve both? 693 00:33:15,660 --> 00:33:19,230 True sortation at high speeds. 694 00:33:19,230 --> 00:33:21,450 So we're close to 600 feet a minute 695 00:33:21,450 --> 00:33:23,190 on our sortation systems. 696 00:33:23,190 --> 00:33:27,810 How do we singulate tag reads to know it's that case that 697 00:33:27,810 --> 00:33:29,340 needs to go to store 50? 698 00:33:32,040 --> 00:33:34,800 I spoke quite a bit about mobile devices-- 699 00:33:34,800 --> 00:33:36,840 about robust, deployable mobile devices. 700 00:33:40,180 --> 00:33:45,220 And international-- we need true global tags. 701 00:33:45,220 --> 00:33:50,160 I mentioned about Gen 2 being a global solution. 702 00:33:50,160 --> 00:33:52,910 But I think what you'll see out there today with Gen 2 703 00:33:52,910 --> 00:33:57,420 is those tags attuned to each geographic area. 704 00:33:57,420 --> 00:33:59,890 So the tags that we're testing here 705 00:33:59,890 --> 00:34:03,590 are sure attuned to the US. 706 00:34:03,590 --> 00:34:08,510 The tags that we're testing in Europe are attuned to Europe. 707 00:34:08,510 --> 00:34:10,179 That's not going to work. 708 00:34:10,179 --> 00:34:14,130 That wasn't the idea of Gen 2. 709 00:34:14,130 --> 00:34:21,170 So we need to tune the tags to one sort of format that 710 00:34:21,170 --> 00:34:24,190 will work around the world. 711 00:34:24,190 --> 00:34:28,170 And we need to move the EPC network from theory 712 00:34:28,170 --> 00:34:29,759 and PowerPoints into reality. 713 00:34:33,402 --> 00:34:34,860 I'll just about pharma, and I think 714 00:34:34,860 --> 00:34:36,719 there was a separate session yesterday 715 00:34:36,719 --> 00:34:40,310 on pharma which I wasn't able to make. 716 00:34:40,310 --> 00:34:43,030 But in the UHS space, there's been 717 00:34:43,030 --> 00:34:44,949 a lot of focus on case and pallet, 718 00:34:44,949 --> 00:34:47,679 and large form factors of tags. 719 00:34:47,679 --> 00:34:50,719 Little emphasis on the small form factors. 720 00:34:50,719 --> 00:34:53,909 But we need to work on that. 721 00:34:53,909 --> 00:34:57,450 There's initiatives happening right now showing 722 00:34:57,450 --> 00:34:59,070 some good results in labs. 723 00:34:59,070 --> 00:35:02,040 But again, we need to move this out to the field 724 00:35:02,040 --> 00:35:04,610 to get real world learning. 725 00:35:04,610 --> 00:35:08,180 And then have a proper debate whether HF or UHF 726 00:35:08,180 --> 00:35:11,960 is a correct method to move forward with. 727 00:35:11,960 --> 00:35:15,080 And a big need not just for pharma, but other areas 728 00:35:15,080 --> 00:35:18,590 as well for security. 729 00:35:18,590 --> 00:35:20,240 So what are the security measures 730 00:35:20,240 --> 00:35:23,000 that we would want and need on such products? 731 00:35:25,850 --> 00:35:30,828 Mentioned about international on the EPC network. 732 00:35:30,828 --> 00:35:32,780 And direction. 733 00:35:32,780 --> 00:35:38,230 This is probably my number one objective for this year 734 00:35:38,230 --> 00:35:41,480 is through RFID to sense direction. 735 00:35:41,480 --> 00:35:44,860 So Bill mentioned about read rates not 100%, 736 00:35:44,860 --> 00:35:48,020 and we don't need them to be 100% today. 737 00:35:48,020 --> 00:35:50,960 But having direction-- knowing that something is either 738 00:35:50,960 --> 00:35:55,430 leaving this room or coming into this room then 739 00:35:55,430 --> 00:35:57,470 actually gives us a much more accurate data 740 00:35:57,470 --> 00:36:00,730 than we have today. 741 00:36:00,730 --> 00:36:03,610 The last thing I want to do is tell an associate 742 00:36:03,610 --> 00:36:08,400 to go and pick a case that's sat in the background of a store, 743 00:36:08,400 --> 00:36:12,110 and then go there, and it's not there-- can't be found. 744 00:36:12,110 --> 00:36:14,440 That discredits the whole system. 745 00:36:14,440 --> 00:36:17,930 So the cleaner data we can get, then the better position 746 00:36:17,930 --> 00:36:20,110 we are, the better execution we'll get. 747 00:36:20,110 --> 00:36:22,600 And direction will give us that. 748 00:36:22,600 --> 00:36:27,850 And there's various theories and solutions thrown out there 749 00:36:27,850 --> 00:36:30,280 from using RFID and complimentary 750 00:36:30,280 --> 00:36:33,370 technologies such as sensors that we could use, 751 00:36:33,370 --> 00:36:35,440 or things like the Doppler effect 752 00:36:35,440 --> 00:36:37,570 that we could use through readers. 753 00:36:37,570 --> 00:36:40,960 But we really need to get out there and try for a four 754 00:36:40,960 --> 00:36:42,670 or five of these different methods 755 00:36:42,670 --> 00:36:47,750 to see which is most appropriate and cost effective. 756 00:36:47,750 --> 00:36:50,190 And then some of the Holy Grails. 757 00:36:50,190 --> 00:36:52,730 Reading all cases on a pallet-- 758 00:36:52,730 --> 00:36:55,960 not possible today. 759 00:36:55,960 --> 00:36:59,720 But how can we achieve that in the future? 760 00:36:59,720 --> 00:37:03,270 And how do we get to the sub $0.05 tag 761 00:37:03,270 --> 00:37:06,240 so that the automated checkout becomes 762 00:37:06,240 --> 00:37:07,970 a reality in the future? 763 00:37:11,270 --> 00:37:13,390 What do we need to keep doing? 764 00:37:13,390 --> 00:37:17,000 We need to keep educating. 765 00:37:17,000 --> 00:37:18,750 We need to keep educating governing bodies 766 00:37:18,750 --> 00:37:24,790 around the world so that Gen 2 is endorsed 767 00:37:24,790 --> 00:37:31,970 in every region, every country so that global tag can be used. 768 00:37:31,970 --> 00:37:34,090 We need to educate end users. 769 00:37:34,090 --> 00:37:36,280 What are the benefits of RFID? 770 00:37:36,280 --> 00:37:39,020 How best to deploy it, where to start? 771 00:37:39,020 --> 00:37:42,220 There's some great work being done in this area already. 772 00:37:42,220 --> 00:37:46,290 And as Bill mentioned, developing and nurturing people 773 00:37:46,290 --> 00:37:52,960 today to help in the future build these systems 774 00:37:52,960 --> 00:37:55,060 and manage these systems. 775 00:37:55,060 --> 00:37:57,340 And quality improvements. 776 00:37:57,340 --> 00:38:03,910 The cost isn't just about this tags costed me $0.12. 777 00:38:03,910 --> 00:38:07,810 Yield rates are important too because that cost gets passed 778 00:38:07,810 --> 00:38:10,870 on somewhere down the line. 779 00:38:10,870 --> 00:38:14,870 And testing for true interoperability. 780 00:38:14,870 --> 00:38:18,470 Testing for what is the best tag or the intended 781 00:38:18,470 --> 00:38:22,115 design for that product that you're shipping? 782 00:38:22,115 --> 00:38:26,210 And Bill shared with me a while ago an interesting story 783 00:38:26,210 --> 00:38:30,020 from a supplier where it was two cases of a product-- 784 00:38:30,020 --> 00:38:32,840 one of our suppliers, and it was the same product, 785 00:38:32,840 --> 00:38:34,810 except a different flavor. 786 00:38:34,810 --> 00:38:36,850 And they were getting good read rates on one 787 00:38:36,850 --> 00:38:38,900 and poor read rates on the other, 788 00:38:38,900 --> 00:38:41,550 and couldn't understand why that was. 789 00:38:41,550 --> 00:38:45,640 And went along to Bill and said, can you help us with this? 790 00:38:45,640 --> 00:38:49,150 And after some trial and error, and swapping 791 00:38:49,150 --> 00:38:51,610 the product between the two boxes, 792 00:38:51,610 --> 00:38:53,770 found out that one of the flavors 793 00:38:53,770 --> 00:38:57,670 had some metallic paint within the packaging. 794 00:38:57,670 --> 00:39:01,810 It was that that was causing the poor read 795 00:39:01,810 --> 00:39:04,090 rate on that second product. 796 00:39:04,090 --> 00:39:07,810 So to a supplier, it was the same product, same packaging 797 00:39:07,810 --> 00:39:11,380 as they thought, same density of product inside, 798 00:39:11,380 --> 00:39:14,360 but two different results. 799 00:39:14,360 --> 00:39:19,043 So how can we test and get best practice out there 800 00:39:19,043 --> 00:39:21,460 so every supplier doesn't have to go through that learning 801 00:39:21,460 --> 00:39:22,780 process? 802 00:39:22,780 --> 00:39:24,850 Because that reduces costs overall. 803 00:39:28,320 --> 00:39:33,450 And we should all be mindful that as we move forward 804 00:39:33,450 --> 00:39:37,320 to the sales floor, to items, to theft prevention, 805 00:39:37,320 --> 00:39:40,170 that we need to ensure that privacy concerns are taken 806 00:39:40,170 --> 00:39:43,920 into account and addressed. 807 00:39:43,920 --> 00:39:49,640 This should only equal lowering the cost of implementation. 808 00:39:49,640 --> 00:39:55,340 So just to wrap up, we're just scratching the surface today. 809 00:39:55,340 --> 00:39:56,900 We need to get mobile devices out 810 00:39:56,900 --> 00:40:01,230 there so that people can go about their everyday job, 811 00:40:01,230 --> 00:40:03,390 and the system is just talking to them, 812 00:40:03,390 --> 00:40:06,930 and giving them work to do in a prioritized way. 813 00:40:06,930 --> 00:40:09,685 We need to lower the cost of deployment. 814 00:40:09,685 --> 00:40:11,060 And then finally, we should never 815 00:40:11,060 --> 00:40:14,630 lose sight of why we're using this technology, why 816 00:40:14,630 --> 00:40:17,150 we're pushing this technology and driving forward. 817 00:40:17,150 --> 00:40:19,950 It's all about the customer at the end of the day. 818 00:40:19,950 --> 00:40:22,190 So whether you're a supplier or a retailer, 819 00:40:22,190 --> 00:40:25,010 at the end of the day, we need to service our customers 820 00:40:25,010 --> 00:40:25,875 better. 821 00:40:25,875 --> 00:40:27,770 And whether that's working more efficiently 822 00:40:27,770 --> 00:40:29,720 and taking cost out of the supply chain 823 00:40:29,720 --> 00:40:32,140 that then can be passed on to the customer, 824 00:40:32,140 --> 00:40:33,480 that's our end goal. 825 00:40:33,480 --> 00:40:35,490 Thank you.