American forces press service (Oct. 7, 2005): new supply-tracking system gets items to troops faster.

WASHINGTON -- Defense Department officials know they'll save taxpayers money with the new radio frequency identification tracking system. But, because of a lack of experience with RFID technology, experts don't yet know exactly how much money will be saved, a top logistics official said. Further analysis is needed before officials can give a definitive estimate on the amount of savings they will reap with the system, Alan Estevez, assistant deputy undersecretary of defense for supply-chain integration, said during a recent interview in his office.

"Our most conservative estimate of what the department can save is about $70 million in a five-year period," he said. "Our most optimistic estimate is about $1.7 billion."

Estevez pointed out that the greatest savings wouldn't be in dollars. The true savings will come from an increase in military readiness. Ensuring that a multimillion-dollar aircraft isn't sitting idle on an aircraft carrier waiting for a part can produce enormous savings in terms of readiness. Also, a more streamlined system means there are fewer parts in the pipeline and less investment for DoD for the same or greater warfighting capability.

RFID tags are coded with radio waves. An RFID reader or antenna calls out with a radio wave looking for a tag embedded on an object. The tag sends back its RFID identification. The tags can be programmed to receive, store, and transmit such information as serial numbers, place of assembly, or personal information such as health care records.

Traditional bar codes will remain the dominant auto-identification technology in most mainstream applications for the foreseeable future, as that technology is fully fielded, inexpensive, and provides redundant capability for data capture. But RFID technology is better suited for some applications. Estevez said RFID is especially valuable in "non-line-of-sight applications," such as when information is needed off a specific inventory object from the bottom of a stack and across a loaded warehouse.

"Most people use RFID and don't even think about it," Estevez said. Automatic toll-collection systems that don't require drivers to stop, ID badges that allow entry to a building just by waving them in front of a scanner, and cards that automatically deduct fees for mass-transit systems when they're placed near a reader all use RFID technology.

State transportation departments use the technology to monitor tollbooth traffic. Farmers use it to track cattle. RFID is also used in fuel pumps and convenience stores, airline bag tracking, library systems, and a host of other applications, Estevez said.

In addition to retail stores, Estevez said, major suppliers to DoD such as Lockheed Martin, Boeing, Raytheon, and GE, also use the technology.

Most Americans are familiar with bar codes and their role in inventory control. But scanners can miss bar codes, resulting in material being stuck in limbo. With RFID, the scanner does not need to be close to or physically touching an RFID tag to identify the material. The tag can be read from 15 to 30 feet away.

"If you have a hand-held [RFID] reader, you can find something by just walking around," Estevez said. "So it gives you better inventory accuracy of what you have in your facility. Some facilities have increased their inventory accuracy by upwards of 3 percent, which can be huge for someone not getting the part they're looking for because it's lost in this warehouse."

RFID technology also cuts down on the time it takes to account for material. A forklift driver can pick up a pallet full of tagged items, drive it past an RFID reader, and have a full accounting of what's on the pallet. The system can also be set up to automatically alert suppliers if an item is headed to the wrong destination.

"There's a lot we can do to improve our supply chain," Estevez said. "RFID is one tool to do that. So the work I'm doing is part of the overall program to improve our supply channel. We're doing this to make sure the men and women, military and civilian, that we've deployed in harm's way get the support they deserve."

On Sept. 28, Estevez received the 2005 National Security Medal in recognition of his implementation of Radio Frequency Identification for use in military logistics (story on page 79).