Q & A Real-Time Solutions

Knowing where things like containers are, and what condition they're in, is a major aspect of the supply chain and logistics management, and a competitive advantage, among other things

08.03.06, 12:00 PM ET; By: Robert Malone; http://www.forbes.com/logistics/2006/08/02/rfcode-dugan-qanda-cx_rm_0803rfcode.html

RF Code of Mesa, Ariz., provides solutions in tracking and locating assets with a set of tools that includes extensive hardware (tags, sensors, mobile tracking units), software and a solutions platform including maintenance of the system. Its work encompasses industries such as defense, health care, manufacturing, transportation, aerospace, information technology and security. Its client list is formidable: It includes SYMX, with a recent program in health care, as well as Mitsui (nyse: MITSY - news - people ), Unisys (nyse: UIS - news - people ), LXE, Avery Dennison (nyse: AVY - news - people ) and the U.S. Department of Homeland Security, among many others.

Forbes.com met with Joe Dugan, the CEO and president of RF Code. Dugan is a veteran of radio frequency identification (RFID) and other technologies and served as vice president of worldwide advanced applications for Oracle (nasdaq: ORCL - news - people ). In his own right, he holds three joint RFID patents and has been instrumental in the development of intelligent wireless devices for NexvisionIX. He has done pioneering work in RFID marketplace definition and Web-based solutions.

Forbes.com: Paint a picture of what you and your company, RF Code, are all about in relation to the supply chain.

Dugan: We looked at the supply chain from the standpoint of managing transactions so as things occur throughout the supply chain--whether it is the initial sourcing, buying, the pickup by the logistics company, or the drayage--shipping everything has been "transactionized." RF Code's technology became very enticing through which to apply a different view.

Talk about that different view.

The work that I had done in homeland security, in tracking the supply chain and trying to detect it, showed that what was needed was a chain of custody. A chain of custody was dependent upon a life cycle of a shipment--the theory being that we could get down to managing a box as it moved all the way through, and we could divert that box or change the plan of that box. The problem is that transaction-oriented systems are extremely dependent upon the transaction being [completed]. However, transactions are not always done, as they are impacted by education, labor differences, the nature of the infrastructure and so forth. Looking at the whole, you can get to the financial transactions, as they involve someone getting paid. But when you want to know what is actually going on, there are huge holes.

Where does a useful supply chain go from there?

RF Code looks at the supply chain from a location and an awareness perspective: "Tell me where things are and tell me the state they are in"--and I can take that information back as feedback, and I can adapt to a context that makes sense.

It appears that what you are saying is that knowing the event in the context of its environment takes a solution a long way.

Yes, this works whether we are updating a bunch of systems or updating a Web portal or doing a track-and-trace that's done as the box or the container goes through its process--rather than taking time and steps to do transactions and update something and then put it in context. The thought, then, was to move toward real-time location and sensor (RTLS) solutions. Sensors can be brought into the equation, and there is an integrated approach.

How broadly could this point of view be applied?

We found we could apply it to any type of supply chain. It fit whether it was containers, or logistics management, or an internal supply chain within buildings, or a people supply chain. Once you can put things in context, you can push that up--for instance, to a business system. The system can grab that information and make sense of it. When you have the infrastructure in place, not only can you get where things are and what state they are in, but you can see the changes in locations and states. The feedback coming down from other enterprise systems changes, as does the feedback coming up from the item or the device, as in sensor information from the container itself. RF Code looks at all this and states that we are in a world of RFID.

Is your perspective on RFID different than the ordinary interpretation?

Yes. RFID from the Wal-Mart Stores (nyse: WMT - news - people ) or mandate perspective has been automating the transactions. So when we automate the transactions, we use passive technology, or an active technology that states, "I have done a receipt," or "I have done a put-away." What we have done successfully is take the transaction out of the equation and merge business processes with items, assets, people or whatever. Using technology, we can see things moving through their life cycle. We are automating not just the transactions but giving the full picture of the feedback throughout the loop. This really is a revolution in terms of how you look at data collection by states, environments and locations, instead of merely as transactions.