Drivers at Daisy Brand can load 24 pallets on their trucks in 20 minutes. It used to take them an hour. The reason for the difference? RFID technology.
Daisy Brand's adoption of RFID technology is helping the 75-year-old, privately held company increase its product throughput and expand its customer base. The technology increases inventory visibility and it enables its drivers to manage their own workloads.
Daisy Brand (www.daisybrand.com) produces sour cream at its 50,000 sq.-ft. manufacturing and warehouse facility in Dallas. It makes four different formulas that are packaged for retail or food service. Packaging sizes range from single once servings, 8- or 16ounce containers for grocery stores, to 10 lb. buckets and pouches. Finished goods SKUs number 30 to 40. Its sour cream products are distributed nationally with assistance from third-party inventory locations across the country to customers like Wal-Mart, Albertsons, Safeway, Kroger's, Target, and the U.S. Department of Defense.
The Wal-Mart Effect
Daisy Brand was one of the initial companies that volunteered to participate in Wal-Mart's RFID-compliance initiative in 2005. "We were one of the early adopters in the perishable space," says Kevin Brown, director of information technology. We saw it as an opportunity to take a leadership role in the application of the technology."
The company succeeded in meeting Wal-Mart's go-live date. Today, uniquely assigned RFID-tags are applied to cases for Wal-Mart, and all of the finished goods pallets that come from its manufacturing plant. The cooler temperatures in Daisy's refrigerated warehouse do not affect the read performance of the RFID tags. However, in colder environments, such as frozen foods, RFID tags need to have a stronger adhesive so they stay attached to cases and pallets.
Every time a tagged pallet is touched, an inventory transaction is automatically recorded in the company's Protean ERP software from Infor (Alpharetta, Ga., www.infor.com). The system is driven by the pallet's location at a particular time and by what the lift truck driver tells his onboard computer about what he is doing with the pallet. The system then generates the appropriate inventory transaction.
Daisy shares information with WalMart through advanced shipping notifications transmitted through EDI. Wal-Mart either lets a Daisy manager access to its retail inventory management system, or go into its decision support system and query information on Daisy's RFID tags. Brown says he can see information about Daisy Brand's products in Wal-Mart warehouses and stores at a defined time for a particular SKU. Wal-Mart also sends him the information in an Excel file on a periodic basis transmitted through email or EDI.
Drivers on board
In late 2005, the company's management team decided to leverage its RFID investment and move from a manual to an electronic, real-time inventory tracking system. Initially, Daisy's drivers were concerned that jobs were being automated, but managers were successful in getting its drivers to accept the new system because it brought them into the implementation process from the beginning.
Drivers participated in designing the data entry screens, determining the best ways to load trucks, how to deal with exceptions, and what to do if a truck arrived late and how that would affect the workflow. The new system automates the drivers' data entry duties and lets them concentrate on managing their workloads based on the number of orders and shipments that need to go out the next day.
"They are the ones in control of that. We tell them the scope of the work; they are responsible for executing it," says Brown. "The great part about this is as soon as they get their work done, their work is done. If they get done early, they go home early. If they get done late, they go home late. It is a win-win situation. We still give them the power to control their own destiny as to how the work will be completed, but we have given them a technology that is smart enough to help them collect all of the data we need to run the business."
It takes two weeks to train new drivers on the system. Daisy Brand has even developed some online training modules for drivers that include simulations.
The RFID labels that Daisy Brand workers attach to the pallets contain information about the product including the date and expiration codes and pallet IDs, plus a bar code and shipping information. In effect, the RFID tag is the license plate for the pallet that all customers can use.
The company's fleet of Crown (New Bremen, Ohio, www.crown.com) lift trucks carries Windows XP rugged tablet computers that are integrated with an RFID reader and antenna. Since RFID technology is rapidly advancing, Brown made the decision to load the tablet computers with iMotion software from GlobeRanger Corp. (Richardson, Texas, www.globeranger.com). The software transfers the scanned tag data to Daisy's proprietary software, which sends the driver information about where to put the load. The system records the transaction, the lot, the expiration date, and the move from finished goods to shipping. Because Daisy Brand's products are perishable, tracking expiration dates and rotating product to keep it fresh in the supply chain is critical.
"Our traceability is very high from raw materials to where finished goods are shipped," Brown says. "I can run queries against pallets and tell you everywhere that pallet has been and what lot it came out of during the company's production cycle and, hopefully, back that up into what raw materials were consumed. Traceability for food safety gets enhanced greatly."
To track what the company needs to track, programmers set up the inventory management system to include the appropriate business rules that tie into required customer service levels. All that lift-truck drivers have to do is follow the prompts.
"This is more information for a lifttruck driver to remember. He has too many other things to worry about. You want him paying attention to where he is driving not doing a lot of data entry and recording things. We want them worried about getting the truck loaded right," says Brown.
When drivers pick up a pallet, they tell the system what they are doing with it; the system does not tell them what to do with the pallet. "The drivers know how to rotate the product better than we do. So the system does not have a directed putaway. But it can and does suggested gets. It a driver needs a particular product; the system will tell the driver where the product is in the rack and what the freshest code date is," he adds.
As soon as the driver picks up a pallet, he knows whether or not he has the right one. The system will tell him if he picked the wrong pallet or is trying to drop the right pallet on the wrong truck. It won't allow the transaction to be recorded if a driver tries to load the wrong pallet on a truck, or the right pallet on the wrong truck.
As soon as a truck is loaded, the system validates the contents of the truck against the order in the company's ERP system and if it is still in sync, the driver records the trailer temperature and cleanliness. Once he indicates "truck done," and pushes a button on the tablet PC, all of the bill of lading materials printout at the dock and the truck driver is on his way. At this time an advanced shipment notification is sent to the customer. The shipping memo is also recorded in the company's ERP system, triggering an invoice.
Daisy Brand is in the process of breaking ground on a new plant in Casa Grande, Ariz., that is expected to be completed in 12 to 18 months. The same RFID system will be implemented at the new facility. Data from the system will be sent to the main office in Dallas, where the inventory will be managed.
When the new facility comes online, Daisy's order management team will be able to see where it has inventory in all of its warehouses. They will be able to determine the most efficient distribution of product based on inventory availability at each plant. Brown says, "This gives us a lot of flexibility in the future about how we manage our supply chain and what products are moving where."
Equipped with onboard computers and RFID scanners, Daisy Brand's lift truck drivers speed product loading.