PeopleSoft Announces RFID Software As Target Issues Mandate

The market for radio frequency identification (RFID) technology received another boost last month, when retailer Target followed Wal-Mart’s lead in requiring its largest suppliers to start using RFID tags next year. PeopleSoft also announced an expanded partnership with Data Systems International to develop RFID solutions for the PeopleSoft Enterprise and EnterpriseOne (formerly J.D. Edwards OneWorld) ERP applications, which will ship this quarter.

Two weeks ago Target’s chief information officer, Paul Singer, sent a letter to the company’s suppliers informing them of the new RFID requirement. The Minneapolis, Minnesota, company, which is the fourth largest retailer in the United States behind Wal-Mart, Home Depot, and Kroger, wants its largest suppliers to begin using RFID tags at the pallet and case level in late spring 2005. By spring 2007, all of Target’s suppliers will be required to use RFID tags.

RFID technology is gaining widespread momentum in the consumer processed goods industry as a replacement for the ubiquitous barcode. Much more data about the goods can be burned onto a 15-to-20-cent RFID tag, using the Electronic Product Code (EPC) standard, than can be related in a barcode, using the Universal Product Code (UPC) standard. And with unmanned RFID scanners monitoring the movement of goods at doors and loading bays, companies would no longer need to employ workers to walk around warehouses with wireless barcode scanners.

ERP and supply chain planning and execution software vendors are eager to help companies in the consumer processed goods industry to become leaner through Internet-enabled RFID. Proponents of the technology say a fully integrated RFID implementation could enable retailers and distributors to track goods with unprecedented real-time accuracy and to reduce inventory kept on hand by up to 25 percent, thereby saving billions of dollars in real estate. The increased transparency of consumer demand would also be a boon for planners on both ends of the supply chain.

Wal-Mart’s 2003 mandate for its top 100 suppliers to begin using EPC tags at the pallet and case level suddenly put the spotlight on RFID, which had been used for years to track cattle and railcars and to speed motorists through gas station checkouts and toll booths. Wal-Mart relishes its role as an early adopter of new technology, as attested to by the requirements it’s made in recent years for suppliers to send EDI documents over the Internet using the AS2 standard, and for suppliers to begin using the UCCnet GLOBALregistry to eliminate product data inaccuracies. In the case of UCCnet, Wal-Mart’s lead is being followed by Home Depot, Lowe’s, and Ace. Some industry groups say it’s only a matter of time before leaders in other industries make their own RFID mandates.

PeopleSoft, which acquired OS/400 ERP juggernaut J.D. Edwards last year, is one of the software vendors angling to serve an expected boom in demand for RFID hardware, software, and services as a result of retailer mandates. At the Manufacturing Week 2004 conference in Chicago last week, the Pleasanton, California, company announced its plan to start shipping RFID software for its flagship Enterprise and JDE-based EnterpriseOne applications in the second quarter of this year.

Les Wyatt, general manager of PeopleSoft EnterpriseOne, says emerging RFID requirements are changing the economics of supply chain management. “The potential for improved business processes, better control over inventory, cost savings, and efficiencies are significant,” he says.

PeopleSoft’s RFID strategy hinges on its partnerships with supply chain software maker Manhattan Associates; High Jump Software, which develops an RFID-enabled supply chain execution system that runs on Windows; and Data Systems International, a large iSeries reseller that also sells a line of scanners and automated data collection middleware.

Data Systems International says that its dcLINK suite of data collection products will support both the EnterpriseOne and World suites of JDE software, as well as PeopleSoft’s flagship Enterprise software.

The Overland Park, Kansas, company says dcLINK is the first RFID solution available for EnterpriseOne and World that supports the required EPC Class1, Generation 2 standards that Wal-Mart is pushing. The capability to simultaneously support both traditional barcodes and RFID tags on a single scanning device is another feature that Data Systems International says will be important to its customers.

In other RFID news, Alien Technology announced the availability of a new RFID reader last week, which the company claims is faster and more sensitive than previous versions. The ALR-9780 EPC Class 1-compliant RFID reader’s four read-write antennas deliver significant performance increases over current models, the company claims.

A California state senator also introduced a new bill last week that would require users of RFID technology to implement certain safeguards in order to protect people’s privacy. Senator Debra Bowen Senate Bill 1834 would require companies to ensure that RFID tags are destroyed before consumers leave a store. It would also require businesses or governments to require consent from consumers before using RFID to track or collect information about them, and to notify people that they’re using RFID technology that could track and collect information about them.