As one of the world's largest originators of bulk chemical shipments, The Dow Chemical Co. has a major financial stake in keeping close tabs on all of its far-flung containers and inventory assets - not only to ensure the safety and security of its hazardous material shipments, but also with an eye toward optimizing supply chain efficiencies.
That's why the Midland, Mich.-based chemical giant last year launched an aggressive new, track-and-trace program based on state-of-the-art supply chain technologies. To be rolled out over a 10-year period, the initiative aims to integrate automatic identification technologies including bar code and radio frequency identification (RFID) with Web-based global positioning system (GPS) services. When fully implemented, the system will enable Dow managers to pinpoint the location of a shipment and its contents anywhere on the planet.
What's more, Dow doesn't intend to rest just on knowing shipment locations. The program also incorporates container-based sensors that can detect everything from hazardous leaks and dangerous temperature excursions to unauthorized tampering with shipment containers. The system can be programmed to automatically send alerts to Dow personnel - via cell phone or e-mail, for example, or through the Web-based system interfaceâ€”when shipment irregularities are detected. Similar alerts can be dispatched when a shipment fails to reach its destination within a designated time.
Trucks, trains and ships
The Dow track-and-trace project traces its roots to 2003, when the company set out to determine the most effective technology for a container-tracking solution that could be leveraged company-wide across all types of containers, says Craig Casto, global ID and label technology leader at Dow Chemical's Supply Chain Technology Center, in South Charleston, W.Va., and a member of Dow's RFID/GPS Steering Team. "For us, a container is basically any type of shipping vessel that we put product into. It could be a gas cylinder or a drum, or a truck, a rail car, a barge or a ship," Casto explains.
Using a selection process based on Six Sigma principles,"we looked at about 30 different companies that had some type of container-tracking solution," Casto says. At the time, RFID was being widely discussed, due to the much publicized Wal-Mart RFID supply chain program. And while Dow Chemical was intent upon becoming a chemical industry leader in the implementation of RFID, the company also wanted a tracking solution that was data agnostic, Casto observes. This meant that any system chosen would need the ability to handle a variety of data types, including bar codes, active and passive RFID, and GPS feeds.
Dow ultimately selected Savi Technology Inc., of Sunnyvale, Calif., as its strategic partner for the container-tracking project. Savi, which was recently acquired by defense contractor Lockheed Martin Corp., is a major provider of global RFID supply chain systems to the U.S. Department of Defense. Savi's commercial unit in September 2005 introduced a supply chain offering designed for the chemical industry - called the Savi Chemical Industry Chain of Custody Solution - and at the same time announced Dow Chemical as its first customer for the service.
Where's that fumigant?
Dow's initial project using the Savi technology involved tracking shipments and returns of 125-pound gas cylinders filled with a termite fumigant produced by a division of Dow AgroSciences, says Casto. "We're tracking thousands of these cylinders globally," he notes. "We're using bar code technology, and as they pass through each step in the supply chain, we're collecting information around work processes such as shipping, receiving and inventory."
These data are transmitted to an enterprise-level application called the Savi SmartChain Asset Management System (AMS) 4.5, which is hosted by Savi for Dow at a California data center on an Application Service Provider (ASP) basis. Using a Geographic Information Service (GIS) mapping capability, which is part of the AMS system, Dow managers are able to view cylinder locations on a global map, Casto says. And perhaps more importantly, he points out, Dow is able to use logic in the system to build alerts that allow a "management by exception" approach to cylinder handling.
One example involves a U.S. Department of Transportation requirement that the gas cylinders be inspected every five years. Dow has set up the system to check the inspection date on each cylinder as it is returned to the fumigant production facility. "If it finds a cylinder that's due for an inspection within the next six months, it will automatically send an e-mail to the operator who's responsible for doing those inspections," Casto explains. "So it's that kind of exception, and it's that kind of alert logic that we can leverage to make improvements to our work processes."
"We basically have complete visibility of a shipment after it departs our origin location until it reaches its destination." - Craig Casto
Dow uses unique bar codes to represent the serial numbers of individual cylinders, and also uses bar codes at the pallet level for shipping. It's at the next aggregation level, when multiple pallets are placed into intermodal shipment containers, that Savi's RFID and integrated sensor technology comes into play, Casto says.
The active RFID tags operate at 433 megahertz (MHz) ultra-high frequency (UHF), based on the International Standards Organization ISO 18000-7 air interface standards, and are housed on a device that also incorporates what Casto calls a "smart box" that can integrate various kinds of sensors. The assembly fits over the edge of the container door, with the RFID tag on the outside and the sensor smart box on the inside, he says. The contents of the container are written to the tag, which is activated with a handheld device when the intermodal container door is closed and sealed. The containers can then be automatically tracked at various points along their routes by fixed RFID readers, which send the tracking data to the Savi-hosted AMS application.
The sensors inside the container can also detect trouble along the way. Depending on application needs, the Savi system can accommodate a variety of sensor types, including temperature, pressure and vibration. "And the one that we were very interested in, from a security standpoint, was a light sensor," says Casto. These sensors can detect when the container is opened, for instance, or "if somebody cuts a hole in the side." So-called "gas-sniffing" sensors can also be used to detect hazardous material leaks or spills, Casto points out.
While the cylinder tracking application is now fully operational, Dow has numerous other track-and-trace projects in various stages of implementation. Indeed, according to Casto, an internal Dow survey turned up some 450 candidate projects that could benefit from RFID, GPS and auto ID technologies. That number was whittled down to 50, he says. "And we've now got upper management support for a multi-generational plan for the next 10 years that will encompass all 50 of these projects." Ten projects each are slated for 2006 and 2007.
In one proof-of-concept project that was set to begin last month, for example, Dow plans to track the GPS coordinates of ships carrying containers between two Gulf Coast locations and five different locations in the Pacific, Casto says. By marrying RFID-based terrestrial container tracking with the GPS-based ocean vessel tracking, "we basically have complete visibility of a shipment after it departs our origin location until it reaches its destination."
Another ongoing project involves what Casto calls "a very active and aggressive project to equip every single rail car that Dow owns with GPS tracking devices, as well as with sensors." This will allow Dow managers to track the physical location of nearly 1,000 rail cars, while also monitoring environmental conditions in the cars. If the dome of a rail car is opened, triggering a light sensor, "the GPS will wake up and send us an immediate transmission," Casto says. "The ability to know when somebody has opened the dome of a car while it's in transit is something we've never had before." Temperature sensors and gas sniffing sensors will also be used in the rail car project.
On the truck transport side, Dow is also working with its motor carrier partners to similarly leverage the GPS tracking capability that most shippers already have on their tank truck fleets, says Casto. Besides enhancing shipment security, these partnerships may also help Dow improve customer relations. "If GPS tracking shows that the truck wonâ€™t be able to deliver on time, the system can send an alert to a customer service rep, who can then be proactive and let the customer know about the delay," Casto observes.
As individual projects are completed, Dow expects numerous benefits to come out of the decade-long initiative. One major driver for the program is the desire to enhance the safety and security of Dow shipments, Casto notes. But he also expects that the improved supply chain visibility and reliability that will result from the effort will pay dividends in many areas, including improved decision making and responsiveness, increased speed to market, reduced inventories, better customer service and improved regulatory compliance.
"We've stated publicly that we want to be a leader in the chemical industry with RFID implementation and improving supply chain efficiencies and security," says Casto. "And I think this activity shows - especially with our upper management funding this project - that we're very serious about these technologies, and that they're going to significantly impact our work processes in the future."
The Dow Chemical Co.'s RFID/GPD to-do list is diverse. Dow is looking into use of global positioning system (GPS) services for emergency response monitoring of employees who work remotely on a 4,000-mile Dow Gulf Coast pipeline.
The company also has plans to use radio frequency identification (RFID) for "smart shelf" technology for both raw materials and finished goods inventory tracking. RFID readers mounted on plant and warehouse shelves will sense when RFID-tagged items have been added or removed, and automatically debit or add to inventory lists.
Yet another project will be targeted at construction lay-down yards. These are typically large areas the size of football fields where large parts are stored during new chemical production unit construction or maintenance turnaround projects, notes Craig Casto, a member of Dow's RFID/GPS Steering Team. These parts can often be difficult for workers to find. "So we're looking at tagging these large parts with RFID tags, and then using a mesh sensor network to establish a grid over that football field," Casto explains. "That grid would then be constantly monitoring the inventory that's out there, so we could see where the stuff is."