Three years ago, Dow Chemical, the largest chemical company in the world, began a journey to explore the usefulness of RFID to enhance security, improve customer satisfaction, and reduce costs. 

When Dow began to explore this new and still maturing technology, it put together a thorough set of processes to facilitate the analysis and adoption of RFID. Additionally, the company decided that RFID and GPS would work well together for track and trace and it included GPS within the scope of its analysis. Dow began by putting together a core project management team with representation from eBusiness, its IT Architecture group, members who were active in the RFID industry group EPCglobal, and Communications. One of the program management team’s deliverables was to identify Generation 1 projects that should be tackled first in the company’s 10-year journey to explore and deploy RFID. 

Dow has a concept it calls Most Effective Technology (MET). The idea is that certain technologies lend themselves only to certain sites and/or certain fairly small processes, while other technologies work so well, they should be used across the corporation. Dow is also well known as an advanced user of Six Sigma processes. The company applied these processes to determine which RFID projects to tackle in Generation 1.  Dow’s Six Sigma steps included:

• Listening to the “Voice of the Customer” by educating 100 leading business leaders within Dow about active and passive RFID and GPS and then listening to how these technologies might apply to their businesses.
• Dow put together a list of 450 ideas, came up with a list 50 prioritized project areas, and then culled this down to the 10 projects that would be implemented in Generation 1, a time period covering 2006 to 2008.

Businesses within Dow are understandably not anxious to deploy new or bleeding edge technologies. To overcome this resistance, Dow employs Expertise Center funding to explore less established technologies. The Expertise Center is used to fund the proof of concept, a pilot, and a first implementation. They may partially fund a certain number of implementations after that.  At some point, however, when the bugs are worked out and the technology has proven itself, businesses must pick up the cost of subsequent implementations.

Based on this comprehensive process, Dow determined that RFID in combination with GPS qualified as a technology that should be standardized and leveraged across the entire company to globally track containers, cylinders, tank trucks, railcars, and marine cargo. The company decided to implement, and are now using, Savi Technology’s SmartChain solution as its platform for container tracking and event management.

At the container level, these new events will allow for a more reliable inspection process. Cylinders with welds need to be inspected every five years. Now when Dow receives empty cylinders at its plants, it can associate the RFID tracking number with master data on when the cylinder was last inspected and this can trigger “needs inspection” alerts.

When it comes to railroad cars, RFID has long been used to track chemical tankers. However, currently, rail cars must pass by RFID readers, which are located next to the tracks. What this project enables is two-way communication. In other words, Dow does not have to wait for a car to pass a reader to get visibility to its location. By combining RFID and GPS, Dow has better visibility. Every 6 hours, a battery-powered GPS unit wakes up and sends out a message that says “here I am.” Dow can also ping the units to determine the location of specific railcars and get a response within 15 minutes. The next generation solution for railcars will include sensors that can trigger alerts based on liquid levels or pressure; atmospheric sniffers that can detect (in parts per million) emissions from railcars; sensors that can alert if a tanker dome is being opened; and the ability to detect and alert when a railcar leaves a pre-defined geo-fenced area.

When I last talked to Dow about a year ago, the company was beta testing RFID/GPS for tracking intermodal movements of ISO tanks and regular containers through ports and on the ocean. In conducting its beta tests, Dow also involved people from supply chain teams and it uncovered opportunities to reduce inventory and transportation spend based on this visibility. In sum, there are opportunities to reduce costs, improve security and improve customer service based on RFID and GPS.

In conclusion, Dow is still in the process of testing RFID and GPS. What is perhaps most interesting about Dow’s efforts is not what it has achieved so far, but the process it has used to pioneer new and not-fully-mature technologies.