Getting Smart with RFID

May 1, 2004
Manufacturers are using RFID tags to carry detailed product information during work-in-process. But barcodes still rule as an inexpensive tracking system.

Automotive original equipment manufacturers (OEMs) can’t take chances with faulty materials coming down the pike from their tier one suppliers. No carmaker wants to repeat the Ford and Firestone debacle. So the OEMs are making their suppliers prove their goods are good. That proof arrives in a radio-frequency identification (RFID) tag. “When you bolt down the seats, they have to be tightened to a certain tightness and you have to record it,” says Howard Jenkins, executive vice president and founder of Youngstown Systems Company Inc., in Youngstown, Ohio. “In order to know the correct torque, you record it with the number of the seat on the RFID tag.”

Youngstown Systems builds and installs machine control and data acquisition systems for steel producers, automotive suppliers and other manufacturers worldwide, working with control system companies such as GE Fanuc, Siemens and Rockwell Automation. Recently, the company has integrated smart tag (read and write) RFID technology into its systems, utilizing Texas Instruments’ tags.

Big Three mandate

The need to include RFID technology into the work-in-process (WIP) manufacturing floor was mandated by large auto OEMs. So Youngstown helped its tier one seat manufacturing customer incorporate RFID into ten plants around the globe. “This comes down from the Big Three. All of the critical items, from tires to seat belt cinches, have to have a smart tag on them,” says Jenkins. “It’s pretty much a requirement for the part. The only problem is the tags are 60 to 80 cents per pop, and GM isn’t going to pay for it.”

Like many companies that have recently received mandates from their customers to incorporate RFID into their operations, Youngstown’s customers are trying to get their own return on investment (ROI) from the expense of the pricy equipment. “They’re doing it for their own efficiency at well,” says Jenkins. “From the tag’s data, they can tell if the seat is good or bad. If it’s bad, it goes to repair. If you get three or four problems from the same operator in the same position, you can detect the problem and fix it.”

Another quality benefit is the RFID tag carries specific option detail on the product as it moves through manufacturing. “The RFID tag tells the operator what seat goes on the car, what bolt it takes and what upholstery is on the seat,” explains Jenkins. “You have different settings for the heat treatment of the upholstery when it goes through the oven to tighten it. If the wrong seat goes in the oven, it can catch fire.”

Jenkins explains that his seat manufacturer also benefits from the RFID tag’s durability and resistance to worker sabotage, a problem that has long been a burr in the saddle of the auto industry. “We used to do it by barcode, but hostile workers can do stupid things, like recording the same barcode over and over to get to the end of their shifts,” says Jenkins. “With RFID, there’s nothing to see. There’s no line-of-sight, and there’s nothing that a hostile worker can screw up. You can hit it with a hammer and it still works.” Jenkins also notes that the worker often can’t see where the RFID is attached to the seat.

Costly goofs

Having the correct information encoded into the RFID tag helps to avoid problems as the seat enters the OEM’s factory line. One false move on the OEM line can cause major headaches for both the automaker and its seat manufacturing supplier. When the manufacturing line is stopped due to a supplier goof-up, the OEM charges the supplier. “If you shut down the auto line, the charge-back can be $15,000 per minute. I’ve seen charge-backs of a half million dollars. You’d better not do that too many times,” says Jenkins.

The RFID application Jenkins installed at the seat manufacturer writes information onto the tag that can be read both by the seat manufacturer and by its OEM customer when the seats are delivered. “RFID can be read or write,” says Steve Combs, product specialist for identification systems at Balluff Inc., a sensor manufacturer in Florence, Ky. “The operator can read to see what part it is, then act on it. Then when it’s done, it writes that it is completed. Or, you can write in the parameters that indicate it’s within tolerance.”

Because both the automaker and its seat supplier must be able to read data on the tag, the seat manufacturer has to keep the data on the tag and not just in a control system database. If the tag is only being used internally, the manufacturer has the option of recording the data in a database rather than on the RFID tag. “RFID is really targeted to automated machine operations,” says Tom Rosenberg, industry manager for assembly and automation, at Balluff. “Other ID systems don’t store the data on the tag, but rather in the control system. Read-only stations that contact the control system for data are very popular.” They’re popular partly because they tend to be less expensive than a system with read-write RFID tags.

When the RFID tag carries manufacturing information, it relieves the need for a massive database containing factory line data. “Instead of building a mega-database, you can use active RFID tags and encode information into the tag that says what has been done at this step,” says Steve Banker, service director, supply chain management, at ARC Advisory Group Inc., in Dedham, Mass. “It’s a trade-off between the mega-database and local information on tags. In the automotive industry, they sometimes decide the latter makes more sense.”

Hundreds of large manufacturers are being forced to adopt RFID for their retail customers such as Wal-Mart, Target and even the Albertsons grocery store chain. The Department of Defense has also mandated use of RFID by its suppliers. One persistent challenge for companies facing RFID compliance mandates is to find a way to get the investment to pay for itself internally. “Companies are struggling to find an ROI for RFID, and work-in-process—WIP—is one of the things they’re looking at,” says Kara Romanow, research director at Boston-based AMR Research Inc.

Romanow notes that RFID has to offer more than a simple replication of a barcode system if a manufacturer is going to get an ROI from the investment. “If RFID is there just to replace barcodes, that’s not enough,” says Romanow. “A more efficient barcode is not enough to justify the expense of RFID.”

The most common use of RFID during WIP is to use read-write tags that allow the manufacturer to place information on the tag as the product moves through various stages along the factory line. “There are plenty of examples where you would want to update the tag through the manufacturing process,” explains Dan Bodnar, research director of data capture for Intermec Technologies Corp., in Everett, Wash. “The automotive industry has been leading in WIP. BMW and Mercedes carry option data on tags.”

The RFID systems used to track WIP are not the same systems that are getting installed in the warehouse and logistics operations at the manufacturer. The tags used in the warehouse are typically inexpensive read-only passive tags that run as low as 10 cents each. Active read-write tags are five to ten times the cost. “It gets complicated because there are active tags and passive tags,” says ARC’s Banker. “For the most part, Wal-Mart tags are passive, read-only tags because they’re cheaper. In the manufacturing industry, you’re always going to want to encode the tags. And they’re certainly more expensive.”

Part of the reason the auto industry likes RFID tags is because they stay with the vehicle as it moves from the tier one supplier to the OEM. You can’t send a database with the car’s option details along with goods as they move from supplier to OEM, but you can send a tag that knows whether the seats are leather or vinyl.

Find it fast

Another WIP application on the plant floor is the use of RFID to track the inventory that feeds the line. “You don’t want inventory to run out, so you used RFID for location purposes,” says Banker. “Readers in the ceiling can locate the exact piece of inventory so operators can quickly and efficiently get the right inventory in place.”

One of the determining factors on whether to use RFID tags in the manufacturing process is the price of the product being manufactured. “Active tags can only be used on a product above a certain price point, varying from $20 up,” says AMR’s Romanow. “The Department of Defense has been using active tags, because they’re tracking missiles.” Likewise, RFID tags are suitable in automotive both because of the price of the product and because of the cost of shutting down the line due to faulty information.

See sidebar to this article: Barcodes Are Not Going Away