Studying Viability of RFID in Indian Railways

NATIONAL ACADEMY OF INDIAN RAILWAYS

Lalbaug, Vadodara,
Gujarat, India.Pin - 390 004
Phone : +91-265-2652987
Fax : +91-265-2638267
Railway Phone : 091-45203
Email : pit@nair.railnet.gov.in

Submitted By:
SHIVAM DUBEY
IRSS (P) - 2012
Date: 17/09/2014

Acknowledgements



I am really thankful to Shri Atul Gupta, Senior Professor Material Managemet and Shri
Rakesh Rajpurohit, Professor Inventory Management/ NAIR, Vadodara for their continuous
input and help throughout the Study.
I further extend my thanks to the officers and staff of CRIS for providing the relevant
data and extending full cooperation for the completion of project.

SHIVAM DUBEY
IRSS(P)

CONTENTS

1. Introduction
2. Benefits of Implementing RFID in Supply chain management
3. CASE STUDY 1 :Walmart
4. CASE STUDY 2: MARUTI Production
5. RFID and its application in Indian Railways
6. Conclusions
7. References

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Chapter 1: Introduction
RFID Technology
Radio Frequency Identification refers to wireless technology that uses radio waves to
automatically identify items within certain proximity. This process involves tagging items
with a transmitter which will emit bursts of information including, but not limited to, the
identification of the tag. There are three main varieties of tags: Active, Semi-active and
Passive. Active tags rely solely on a battery for its power source resulting in the maximum
integrity rate and reading range but, also, a limited lifespan and higher cost. Semi-Active tags
use batteries to extend the range of the tag only resulting in a higher reading rate than passive
tags, a longer lifespan than the active tags, but also higher cost. The passive tag uses the
electromagnetic pulse from readers as a power source to transmit its identifier. Due to its lack
of a battery, passive tags are the most cost effective and theoretically have an unlimited
lifespan.





I.

Objective : The objective of the study is to find the potiental use of RFID in Railways
and Supply Chain Management. Case studies of some private sector is done

II.

Scope of Study : The study could help in making a case study and to study the
challenges and also to give suggestion whether its economically viable
Limitation of Study : RFID technology is yet to be implemented in Railways although
DMW Patiala has made a proposal for it but its yet to be finalised
Procedure : The procedure involves doing a detailed study of RFID and an effort is
being made to study its effectiveness in improving Supply Chain Management

III.
IV.

Chapter 2: Benefits of Implementing RFID in Supply Chain

Management

The term Supply chain covers all possible processes involved in the flow of goods from
manufacturing to customer; including manufacturing, distribution and transportation. Thus,
supply chain management covers all these steps in combination with marketing decisions,
customer demand, in alignment with general corporate strategy and goals. Usually considered
as a complex and knowledge intensive process, management of supply chain can benefit
significantly from the implementation of RFID technology.
RFID technology has risen to become a revolutionary element in supply chain management.
It is not just a replacement for barcodes. RFID ensures that the right goods are available in
the right place with no discrepancies and zero errors. It makes the supply chain considerably
more precise and improves the efficiency and reliability of the entire chain. As real-time
information is made available also administration and planning processes can be significantly
improved.
Keeping track of the large number of cartons is a very complex as well as time and labor
consuming process. However, RFID can be implemented to ease the situation as it can
improve information management concerning cargo flow.
Usually, read-write equipment is installed at the entry to a warehouse. Every cargo unit is
equipped with RFID tags and all the information relating to the tags is stored in the central
computer of the warehouse.
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When the cargo is moved in or out of the warehouse, the read-write equipment registers it
and forwards the data to the backend system. This allows the management center to manage
the vast amounts of products going into and leaving the storage, recognize cargo and help
with placement of the cargo in the warehouse.
In cases where read-write equipment is placed within the warehouse, all in-house movements
are additionally registered in the system. This allows for strategic planning of product
locations within the warehouse.
The information that is gathered with RFID can lead to significant improvements as the

tracking and handling of the products can be done in real-time and with great
accuracy. In the warehouse, products are easily located as all product movements are
tracked and this information is automatically registered in the system. accurately
RFID in warehouse processes offers:
visibility of accurate real-time information
fast locating of products
possibility to record losses
ability to plan product locations strategically
BENEFITS IN DISTRIBUTION PROCESSES
Implementation of RFID technology can also add advantages to distribution processes. Usage
of RFID will greatly accelerate the speed of delivery management, improve efficiency, and
increase accuracy in selection and distribution processes. It will also reduce distribution costs.
When products embedded with RFID tags enter a distribution center, the RFID read-write
equipment at the entry gate can register the RFID tags, and send the information to the
distribution centers' backend system. This information can be used to put the cartons in
proper places, sort them quickly and efficiently, and dispatch the cartons to the retailing
centers in less time with improved accuracy. Usage of RFID also ensures accurate inventory
control.
As the products reach their final destination, aka the store, they are scanned and registered
automatically at the entrance. For more information about in-store benefits of RFID, check
out the links in the end of this article.
RFID in distribution processes:
accelerates the speed of delivery
improves efficiency
increases accuracy
reduces distribution costs

CASE STUDY:
WAL-MART'S USE OF RFID IN GLOBAL SUPPLY CHAIN
RFID enables Wal-Mart to improve the efficiency of its global supply chain management
through greater supply chain visibility and more accurate ordering decisions. Just in Time
(JIT) ordering enables Wal-Mart to decrease the costs associated with inefficient inventory
decisions and handling. Ordering and sales are more closely aligned, decreasing the intensity
of Bullwhip effects

CASE STUDY QUESTIONS:

1.What is Wal-Mart's primary competitive advantage, and how does it relate to its
mission statement?
2.What advantages and disadvantages occur with the use of RFID technology?
3.What privacy problems has Wal-Mart encountered in their implementation of RFID
technology?
4.What can Wal-Mart do in the future to better its serve its customers more
effectively and efficiently without the risk of privacy invasion?

Wal-Marts size and aggression has long allowed the behemoth company to force
suppliers to radically reconfigure the way it operate. In doing so, Wal-Mart has been
able to slash costs and increase savings. In this same vein, Wal-Mart sought to
streamline its SCM by forcing suppliers to use RFID smart-tags on products being
delivered to Wal-Mart, in the hope that the retail giant could slash labor and inventory
costs. However, suppliers soon found the saving due to revolutionary new
technology did not offset the high costs of the RFID
Manufacturers and retailers, alike have worked towards upgrading the 25 year old
bar code. While bar codes allow retailers and manufactures to track inventory and
match prices to products, they lack the capacity for detailed information customary to
the radio-frequency identification (RFID). Wal-Mart attempted to make the jump from
bar codes to RFID with mixed results. In 2003 Wal-Mart began setting deadlines for
specific suppliers in Texas and Oklahoma, the companys testing grounds for the
RFID, to begin tagging cases and pallets. Wal-Mart pushed the RFID onto
manufacturers with the idea that it would save everyone money. So far Wal-Marts
suppliers have yet to see the savings, most manufactures have been saddled with
the cost of buying new and expensive hardware and software. On top of the extra
purchases, manufactures have seen no increased savings on labor. Unlike bar
codes, RFIDs are put on by hand in the warehouses because most have not adopted
the new RFID technology4.
While suppliers have largely remained quiet, some have begun to drop out of the
wayward experiment. VF Corp, the maker of Wrangler jeans and Nautica
sportswear, reduced its investment in the new technology. Another early adopter
LePage, 2000 Inc. has completely sold off its product line that was involved with
Wal-Marts RFID experiment5.

In response to the growing dissension, Wal-Mart radically changed its RFID strategy,
abandoning its initial decision to force its top suppliers to tag cases and pallets, and
instead opted to focus on products going to Sams Club, promotional display, and
tests to measure the impact of RFID on category management at select stores6.
However, Wal-Mart had not completely given up trying to force suppliers to adapt to
the new RFID. In early 2008 Wal-Mart formally announced the companys intention
to penalize suppliers that did not properly tag pallets and cases with RFIDs headed
to Sams Club. Initially, Wal-Mart charged a service fee of 2-3 dollars for every
untagged pallet or case, however, less than a year later Wal-Mart drastically scaled
the penalties for untagged pallets and cases back from 2-3 dollars a pallet to 12
cents. The reduction in penalties communicates growing supplier frustration with the
problems and costs associated with Wal-Marts implementation of RFID. A month
after Wal-Mart attempts to placate its suppliers with its reduction in penalties, Procter
and Gamble, one of Wal-Marts largest suppliers, pulled out of the RFID pilot
program, implying that Wal-Mart has yet to effectively and efficiently implement the
RFID7.
CONCLUSION
Wal-Mart attempted to make the jump from bar codes to RFID with mixed results. Most
manufactures have been saddled with the cost of buying new and expensive hardware and
software. On top of the extra purchases, manufactures have seen no increased savings on
labor. Unlike bar codes, RFIDs are put on by hand in the warehouses because most have not
adopted the new RFID technology.
So Wal-mart did a roll-back on full implementation on RFID instead it Focused on category
management at select stores,this serves as a lesson to us on the economic viability of RFID
for use in Railways

CASE STUDY 2: Case Study of Maruti Implementing RFID in its

Manufacturing Plant

Detail Analysis
Essen RFID offered a solution for tracking pallets as well as managing manufactured
inventory and rejects through RFID. The technology efficiently tracks pallets and also keeps
track of rejected panels. It deploys Xtenna Proximity to register information and Xtenna
Hybrid to track pallets going from the warehouse to the Weld Shop. It uses MS SQL
Server at the Client machine, while Oracle is used at the central database. The Pallet Tracking
System is developed using .Net Framework, Java JDK and Tomcat.

WORK FLOW
Process Flow:

Vehicle panels are manufactured following a standard process at the Press

Shop. Coiled Steel is cut into Blanks of sheet metal of required size. These are
subsequently stamped to produce the desired form on the sheet metal, known
as Panels. The pressing operation is as follows:

Step 1:
1. Registration of pallets into the database.
2. Mapping of registered pallet with PE code and quantity capacity of pallet.
Step 2:
3. The registered and mapped pallet is brought near the Xtenna Proximity at
the PLC machine.
4. Xtenna Proximity confirms that the correct panel has been brought to the
PLC machine by confirming the PE code with the PLC.
5. When the pallet has been loaded to 95% capacity, an alarm is triggered to
the PLC machine and the count is entered and matched along with that of
reworked and repaired panels.

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Product Identification Model

Conclusion
The system generates the following web-based reports for status of real-time
inventory:
a. Production Report
b. Rejection Report
c. Panel Stock Summary Report
d. Press Panel Stock Detail Report
e. Weld Panel Stock Detail Report

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Since the whole Report is generated in realtime it gives us clear idea of planning grid of the
total stock count and current production stock at each PLC machine in the Press Shop.
Also there is Optimization of inventory levels due to efficient automatic tracking and there
is Reduction in cost and time taken for check-in and check-out of pallets entering and
leaving the warehouse.

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RFID and its Application in Indian Railways

One of the sunrising industry in India as per Mckinsey is that of Indian Railways. Indian
Railway is also accorded with the title of super JEWEL by Mckinsey. Having the largest
network in India, it contributes a lump sum amount of revenue in terms of freight and
passengers. In the recent years, Indian Railways has become one of the favourite modes of
transport with a share of nearly 22% in the passenger transport market.
The vastness of railways cars, cargo, track, countries and conditions presents a massive
challenge for management of rolling stock and rail operations. IPICOs low cost, passive RF
technology enables consistently accurate identification and control of assets in virtually any
operating environment. This largest railway network is on the verge of undertaking a pilot
project on RFID Deployment for automatic
As a freight giant, the industry is looking forward to improve the utilization of the wagons
and has been on a look out for an online system for tracking wagons on its 62000 km worth
of rail network. The pilot is conducted on the Talcher-Paradeep-Vishakhapatnam section of
the East Coast Railway where about five hundred wagons will be affixed with RFID tags.
This is expected to identify the possible problem areas and come out with strategies to
eliminate them.
Under the Information Technology Vision 2012, announced in the Railway Budget for 200809 and 2009-10, the railway ministry plans to give the Railways a modern look and feel by
implementing Modern Communication systems such as RFID, GPS and GIS. Modernisation
of Indian Railways has always been a question in focus for the development of the basic
infrastructure of India. Since the railways represent one of the best modes of transport
available to the common people, it would be impossible to just keeping increasing the fares to
meet the costs incurred due to maintenance, the large workforce and the expansion
activities[2]. The Railways should therefore, consider upgrading itself to cutting-edge
technologies for better efficiency and cost reduction. One such up gradation is the role of
information technology which is achieved with the help of RFID technology. This RFID
technology has been extensively used in the identification process with the help of a card and
a reader. The idea has evolved from a systematic study of the computerization of railways ,
Higher demand for Freight and Passenger transport, with planned economic growth, Need for
capacity enhancement in the Railway network over the next 10-15 years , Technological
uprgadation for better maintenance of railway assets and Upgradation of the Railway

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Production units for improved efficiency and productivity.

Railway Board has already approved the enclosure of the pilot project for using RFID
technology for automatic identification of Railway wagons at an approximate cost of Rs. 2
crores in the existing work of FOIS. The pilot project is implemented on the WaltiarKirandul(KK line) of East Coast Railway( ECOR), on a closed circuit. Approximately, 1000
wagons are to be tagged, and trackside readers are to be placed at various locations,
alongwith handled readers at major yards and loading/unloading points as part of the pilot.
On successful completion of the pilot project, it is planned to expand the system to tag all the
wagons on Indian Railways, and place readers at all the major station yards, and maintenance
facility centres. The approximate cost of all the wagons range from Rs. 100 crores to Rs. 250
crores, depending on the chosen features and choice of technology.

The following are planned to be implemented through RFID

technology:
1. Wagon Number Tracking & Wagon Location.

2. Weight Information
3.Wagon/coach number Tracking is going on in CRIS
4. Weightment of Wagon/Rake is also being tapped in most of the project

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CONCLUSIONS and Viability Analysis

Practical RFID systems are involved in real time tracking and monitoring of events. The
system performs appropriate actions in response to events based on certain conditions. It is
natural to consider the use of the Event, Condition and Action (ECA) framework to address
event management issues.. The paper gives an overview of the current state and trends of
RFID technology. Even though numerous limitations and unresolved issues still hinder the
widespread application of RFID, it can be already seen that especially enterprises in complex
supply chains will benefit from RFID, once the application difficulties are overcome.
Since RFID systems make use of the electromagnetic spectrum (like WiFi networks or
cellphones), they are relatively easy to jam using energy at the right frequency. Although this
would only be an inconvenience for consumers in stores (longer waits at the checkout), it
could be disastrous in other environments where RFID is increasingly used, like hospitals or
in the military in the field.
Also, active RFID tags (those that use a battery to increase the range of the system) can be
repeatedly interrogated to wear the battery down, disrupting the system.
RFID Reader Collision:
Reader collision occurs when the signals from two or more readers overlap. The tag is unable
to respond to simultaneous queries. Systems must be carefully set up to avoid this problem;
many systems use an anti-collision protocol (also called a singulation protocol. Anticollision protocols enable the tags to take turns in transmitting to a reader.
RFID Tag Collision:
Tag collision occurs when many tags are present in a small area; but since the read time is
very fast, it is easier for vendors to develop systems that ensure that tags respond one at a
time.

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References:
[1] www.cris.org.in
[2] www.it.indianrail.gov.in/RFID [3] www.analog.com
[3] http://www.TechNovelgy.com [5] http://blackfin.uclinux.org
[4] ILIE ZUDOR Elisabeth, KEMENY Zsolt, EGRI Peter, MONOSTORI
Laszlo THE RFID TECHNOLOGY AND ITS CURRENT APPLICATIONS
Proceedings of the Modern Information Technology in the Innovation
Processes of Industrial Enterprises MITIP2006, pp. 29-36
[5] TA-4998(IND) : Preparing the Railway Sector Investment Program Final
Report Efficiency Improvement Nov. 2008
[6] Mutigwe Charles, Aghdasi Farhad Research Trends in RFID
Technology IEEE 2006
[7] www.rfidjournal.com [10] www.autoid.org

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Chapter 5: Findings and Conclusion

5.1 Findings:
The unit cost of transportation by rail is lower compared to transportation by road in
the month of July but is higher in the month of October. The reason is that more
wheel set were transported by utilising same no of wagons in July.
The facility of door-to-door transport as available in the case of road transport is not
available.
The late pick up of material by consignee attracts Demurrage charges and for the
delivery parcel way bill is to be sent by mail. While the procedure is simple in the
case of transportation by Road.
The contract management is easy in Road transportation as stores officers directly
deal with transporter and at a time two transport contracts are executed.
The delivery period in case of road transportation is flexible and the material can be
lifted even in short notice period.

5.2 Conclusion:

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 The mode of transportation of wheel set is less time consuming in case of Road and
should be preferred in case of small consignment.
Transportation of wheel set by land can also be preferred when the distance is short
as the transportation by rail involves many formalities which may delay production
activities of consignee.
The Rail transportation should be utilised for large consignment and efficient
management should be there to avoid delay.
For long distance transportation by Railways is cheaper compared to Road but Road
transport has added advantage of easy management and better efficiency.

Appendix: 01
Letter of Acceptance of running contract of Aggarwal transport and
company.

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