More Than Just Visibility. SaviMore Than Just Visibility. Savi

The Business Case for AIDC Solutions Throughout the Supply Chain

AIDC 100 - “Evolution of an RFID Revolution”October 15th 2008

David Shannon, SVP Marketing SAVI/Lockheed Martin

J. Craig Casto, Global Auto ID Leader

Dow Chemical Company

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Savi Group Overview

Savi Logistics Systems

•FOCUS: Customized decision-support logistics solutions for situational awareness, in-transit asset visibility and management, planning, collaboration and optimization.

•MARKET: Large programs and projects for the U.S. DoD and other Federal Agencies.

•PROGRAMS: Global Transportation Network and Business Systems Modernization Center.

Savi Networks

•FOCUS: Real-time information service that automatically tracks, manages and secures intermodal container assets and inventory throughout the global supply chain.

•MARKET: Commercial shipper manufacturers, 3PLs and freight forwarders.

•CUSTOMERS: J&J, Western Digital, Emprevi, PNL Networks.

Savi Technology

•FOCUS: Complete products, solutions & services leveraging RFID and AIT technologies for end-to-end supply chain asset management & security.

•MARKET: Defense, defense suppliers & governments worldwide.

•CUSTOMERS: DoD, NATO and defense forces in the UK, Australia, Denmark, Spain, Sweden, Poland.

Savi ManagedServices(Initiative)

•FOCUS: Develop and deploy integrated, transaction-based information service to make supply chain information accessible and actionable while driving effective decision-making and defined outcomes.

•MARKET: Commercial and government shipper-manufacturers, government and logistics service providers.

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Vision

• Every Conveyance and Mobile Asset Will be Tracked Using Some Type of AIDC Technology– Connect People with Things– Interoperable Networks Leveraging Bar

Codes, Passive and Active RFID, GPS

• Networks Will Be Integrated with Complete Solutions, Services and Apps– AIDC is the Enabler within the Network

• Dynamic Management of Supply Chains– Tracking Conveyances and Their Contents– RFID’s Real Value is Tracking and Securing

Assets End-to-End – Not just within The four walls or point-to-point

Everything Will be Tracked Wirelessly in 10 Years

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Evolution of the AIDC Revolution

• Solving Customer Problems using the right technologies

• Work Collaboratively with Customers

• Evolving to Solutions not just point Technology

• Provide End to End Capabilities

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Requirements for Each LayerThe Right Technology for the Right Application

Layer 5: Movement Vehicle

Layer 4: Container

Layer 3: Unit Load

Layer 2: Transport Unit

Layer 1: Packaging

Layer 0: Item

Barcode

• Long range (300+ft)• High metal environment• Omni directional• Real Time Assured Data• Sensor / Security enabled• Affordable

• Line of sight• Global location

• Short range (3-15ft)• Lower cost tags• Read/write• Non line of sight

• Very short range (1ft)• Ultra Low cost• Read only

Barcode

Passive RFID

Active RFID

GPS/SatCom

Cost

Functionality

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Governance level (‘read & react’)Dashboard function, where progress of the process is

monitored and exceptions are alerted

Tactical level (‘Read & React’)Dashboard function, where progress of the process is

monitored and exceptions are alerted

Operational level (‘Sense & Respond’)Direct feedback to the operational employee to

approve or disapprove a certain action

Strategic level (‘Learn & Leverage’)Information about the performance of the processes used to better tune the operation – in

combination with the forecast

Feedback Loop -Days to Weeks

Minutes to Days

<Sec to Min’s

Customer Satisfaction

Value Chain Optimization

Operational Excellence

Process Control

Homeland Depot PODTransshipmentPOE Theatre DC Unit

Journey

Driving ValueMaking AIDC Information Accessible & Actionable

Transform visibility in value creating execution at the operational & tactical level

RoadTransport

Consolidator/Distribution

Center

RoadTransport Vessel

TransitPort Vessel

Port ofDischarge

DistributionCenter

RoadTransport ConsumerFactory

RailTransport

Value Chain

J. Craig Casto

•Global Auto ID Leader•The Dow Chemical

Company

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RFID/GPS Program Management

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Dow Most Effective Technology (MET)

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RFID/GPS Strategy

• VOC with 100 Dow Business Leaders

• Level set technology and used Six Sigma techniques/tools

• 450 Ideas

• 50 Prioritized Project Areas

• 10 Selected for Generation 1 Implementation

• Validated with Technology Advisory Board of Dow Key Suppliers

• Leverage Auto-ID Expertise Center to own MET

• Leverage PSC processes and disciplines for project execution

• Connect to the industry players to drive standards adoption

• Link investments to Dow’s IT strategy

• Communicate with internal stakeholders to align opportunities

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Facilities, Location, Physical Structure

Tagging

Internal asset utilization & loss prevention

Asset ManagementProduct Inventory & Warehouse Mgmt

Warehouse inventory management / location

management

Product Handling Validation

Product Labeling

Product Consignment Inventory Management

Container & Product Tracking

Container Tracking

Cylinder Tracking

Railcar Monitoring & Tracking

Tank Truck Tracking

Intermodal Container Tracking Marine Pack Cargo Monitoring &

TrackingTracking of all Dow

shipments & receipts

Container Historical Info / Compatibility

Electronic Seals

Container Maintenance Tracking

Product Condition Monitoring

Electronic Documents/ Info Accompanying

Product

Emergency Response Information

Track Pipeline Workers

Maintenance parts identification and

inventory management

Maintenance (MRO)

Locate Maintenance Parts & Spares

Match Maintenance Parts to Specifications

Locate key expensive mobile equipment within

a plant / whseLocate key Managed

Service supplied equipment within plant /

whseTrack Tool & Equipment

utilization & loss prevention

Asset Maintenance Lifecycle Tracking

Asset Lifecycle Tracking Accuracy

Manufacturing

RFID/GPS support of plant construction activity

Whse Inv Mgmt / Location Mgmt

Dow Personnel / Regular Contractor Location Monitoring on site

RFID use to identify worker training and ability

to enter specific areas

Ad hoc personnel location monitoring on site

Material identification and staging during

manufacturing process (Auto BOM, Recipe)

Material identification and staging during

manufacturing process (Pull, Replenish)

Material management & tracking within Dow sites

Hazardous Materials Tracking on Sites

Hazardous Materials Tracking on Sites -

CustodyPlant conditions

(emissions) monitoring

Plant conditions and data collection – Gen 2

RFID use to identify worker training and ability

to execute processes / use equipment

Railcar Optimization

Transportation & Logistics

Optimization

Onsite Container Optimization

Container / Vehicle Fleet Optimization

Transportation Security & Fleet Optimization

Dow RFID / GPS Prioritized Opportunities

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Supply Chain Scope

• 3,500 global employees

• 2.5 million shipments each year

• 45,000 customer ship-to locations

• 200 shipping sites

• 130 billion lbs of product shipped each year

• 20% of shipments involve international border crossings

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Container Tracking MET at 50,000 Feet

Savi TechnologiesInternet based ASP

(GIS Mapping and Event Mgt)

Cylinder Tracking

Railcar Tracking

Intermodal ContainerTracking

Business Objects

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Savi Web PortalDowTrak.com

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Container Tracking – Railcars with RFID & GPS

• RFID on NA rail cars since 90’s– Car location supplied to car

owners multiple times per day

– Used to project ETA’s – Utilized at plants to collect

SAP transactional data

• GPS/SatCom/Sensors– TIH & Flammable Gases– Next Generation Railcal

• Sensor needs (liquid level, pressure, etc)

• Power needs (Rahall Institute power plant)

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The User Interface

• Powered By Google Earth• Defined Geo-Fences for

– High Threat Urban Areas– Dow Sites

» Load Racks» Unload Racks» Maintenance

Tracks» Maintenance

Shops

– Customer Sites

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RFID and GPS Container Tracking Intermodal Containers

Savi Pilot – RFID Based with Ship GPS:– Use RFID tags with Sensors on

containers with Savi port tag reading infrastructure

– Pull GPS coordinates from carriers on ship location carrying Dow intermodal containers into Savi ASP

IBM Pilot – GPS on Container Only:– Use GPS tracking devices with sensors

on containers and track position and environmental data without port infrastructure

– Tracking location of container throughout the voyage

Value:– In-transit monitoring of floating inventory – Flexibility in diverting in-transit inventory

to meet customer needs– Improvement in knowing what’s where

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RFID Container Tracking - Intermodal Containers with RFID & GPS

• Savi Networks - RFID– Freeport to Shatian, China– Houston to India – Value:

• Inventory visibility of in-transit product

• Container level security monitoring

• In-transit Environmental Monitoring

• Customs clearance

• IBM – GPS‐ Exel Houston to KTN Antwerp‐ Savi integration‐ GPS tracking devices & sensors

• In Port with cellular coverage use GSM • At Sea use Satellite GPS coverage

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Heartbeat Tracking Visibility

Rotterdam to Antwerp by Barge

Houston to Rotterdam

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Environmental Conditions Monitoring Inside Container

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Bar Code Tracking Cylinders and Small Containers• Vikane

– Hosting environment upgrade– Vikane software version upgrade– Vikane software enhancements

• SafeChem– Chlorinated Solvents– 38 locations throughout Europe– Metal cleaning application only– 4Q 2008

• DAS Herbicides– 2009 Implementation– 5,500,000 containers annually– 4 European production sites

• Chlorine– Site tracking requirement

• Other Intellitrack– DBS - Marietta Georgia– Dow Automotive – Midland– DBS – Wilmington, IL– R&D Warehouse – Shanghai, China– Michigan Ops Site Logistics

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MET Level 1 Global Tracking

MET Level 2 Site Tracking

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Improved Shipment Visibility Benefits(Estimates)

• 50% improvement in response time to identify and resolve in-transit problems

• 20% reduction in excess product / safety stock inventory

• 20% reduction in container fleet• Up to 90% improvement in reliability of

delivery time windows• Elimination / early detection of product theft• Elimination of the historical 10-15% human

error rate associated with manual work processes to capture and enter data

Railcar Tracking

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Selective Services

Base Services

RoadTransport

Consolidator/Distribution

Center

RoadTransport Vessel

TransitPort Vessel

Port ofDischarge

DistributionCenter

RoadTransport

RetailStoreFactory

RailTransport

Networks of Heterogeneous technologies: RFID, GPS, GPRS, SatCom. Barcode

Service Platform • Info Assurance• SOA • Data Rights Mgmt• Multi-hypothesis Tracking• Interface Integration

Next Generation AIDC Solutions

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The Business Case for AIDC Solutions Throughout the Supply Chain

•Any Questions ?• David Shannon, SVP Marketing

• SAVI/Lockheed Martin• +1-650-316-4738

• dshannon@savi.com

• J. Craig Casto, Global Auto ID Leader• The Dow Chemical Company

• +1 304-747-7019• castojc@dow.com