Ken Koldan

January 30, 2014

6 Min Read
Setting asset codes to determine an industry standard



Asset visibility has already been realized in the food supply chain. Go back a few decades and imagine the grocery stores around 1972. Operations consisted of a checkout associate who keyed in prices on a cash register. Stocking was done by simple inventory methods, and the manager of the store had to have on hand the right mix of products to meet the demand locally.

Fast forward to today and you'll see how both the just-in-time deliveries and local demand are managed more accurately by tracking shoppers' cards for auto ordering and customer buying trends. The smart store is a reality and the biggest star in this automatic world is Walmart.

Sam Walton recognized, long before most people did, that the key to keeping costs down and profits up is a tight inventory control system. Ordering just the right items in just the right amounts is not only a cornerstone but one of his business commandments.

Too much inventory means undue expense; too little means lost sales. Finding a way to keep track of what was selling, what was in the stores, what was on order and what was on back order became one of Walton's obsessions. As a result, Walmart became a retail pioneer in installing electronic scanners at cash registers, all linked to a central inventory-control computer. It is this ability to not only track assets, but make strategic and tactical decisions that optimizes assets and utilization, and that is true asset visibility, the goal of today's logisticians and asset managers.

Logically, then the next question that comes to mind is: Will the largest user and most impactful trend maker act upon these technologies? That answer is a positive and affirmative "yes." The federal government and governments of other countries are walking down this path to optimization.

The Food and Drug Administration (FDA) already has Memorandums of Understanding (MOUs) and operating agreements in place. Additionally, the Department of Defense (DoD) has agreements with NATO countries to work collaboratively in the global community. This has now made asset visibility a real possibility. The key is to walk down the path before the crowd arrives.

Consider the analogy of running with the bulls in Pamplona, Spain. Prior to that action-filled day, the streets of Pamplona are perfectly safe and easy to walk. However, one would not to want to walk those same streets when the bulls have been turned loose. The DoD has gotten this right and has begun implementing asset visibility with the Item Unique Identification (IUID) initiative. The FDA with its Unique Device Identification (UDI) rule is not too far behind. Don't wait until the streets are impassible.

It is truly unique serialization that is the undercarriage to asset visibility. From the perspective of AIDC (Automatic Identification and Data Capture) professionals, the key items are the guarantee of uniqueness and the mark's standard construct (that is, data carrier).

A standard is paramount to the success withstanding the test of time. Let's go back once again to the grocery store analogy when the UPC bar codes were not standard. Each store would then have to have a huge integration effort and software updates that would never end.

The key to the serialization effort is a published standard for the mark/data carrier and, equally important, a common database that houses the data that's shared within the industry. The self-checkout lines we enjoy today did not happen overnight.

The benefits are quite obvious and vary little from industry to industry. It is as simple as "knowing where your stuff is." Simple, yes, but as Walmart proved, it is powerful.

As an example let's look at the list of benefits viewed by the medical device community as stated by the FDA's UDI proposed rule:

• Reduction of medical errors

• The ability to identify compatibility issues-that is, a metallic joint implant does not go into an MRI (Magnetic Resonance Imager).

• Improved medical device reports (MDRs).

• The ability to identify and reduce product counterfeiting.

• More efficient purchasing, reimbursement and supply chain management, thus lowering costs.

• Enhanced medical device asset utilization (that is, right sizing the pool of equipment and ensuring it is properly maintained).

• Enhanced post-market device surveillance for preventative maintenance.

• The ability to support recall of medical devices.

• Better device identification in registries.

• The ability to capture device information in the Electronic Health Record.

This journey, realized already in the food supply chain, continues to refine itself and improve. The benefits to the medical device industry can clearly be transitioned to other industries as has been proven by the retail giants of today.

Tips for enabling

Tip #1: Have a robust mark-one that is two dimensional (2D) and has error correction capability. They are many standards out there. If you are a label purveyor having the ability to encode all the symbology is a must. The key to most people making errors is that the input of the control characters is not standard. Each machine or bar code engine inputs the control characters differently. The American Standard Code for Information Interchange (ASCII) defines the characters computer uses. It does not dictate the control characters that create the data carrier of the asset information.

The key is to know your computer's software application control commands to send. For example the ^ might be the start of the command or [ might be the start. The symptom of this issue is when you verify the construct you will get syntax errors, but the data is correct.

Tip # 2: Uniquely serialize your assets. The "Sam Walton" lesson seems easy and obvious, but it is not. In today's global manufacturing supply chain with vendors competing for business, the ability to uniquely identify the pieces and where they are from is critical.

Two cans of Coke from the same plant will most likely have the same UPC regardless of the hour made.

Serial number tracking is only good within the unique enterprise (i.e., serial number from Motorola is only good for the group within the business unit).

Also, each item shkould have its own unique identifier regardless of enterprise (such as Air Force or Navy) and supply chain (such as Boeing or Lockheed Martin).

Tip #3: Create the standard and publish it. If your industry and customers want to enjoy a more economical solution, then they have to trade off the diversity of data carriers. Companies can focus on the higher level value-added features. If the industry is still trying to figure out data carrier constructs, then get involved in an industry non-profit organization to create the change that will better the industry, such as AIM North America. For more information, visit their website at

In summary, we learned from the retail and food industries that barcodes work, but it takes time to launch them into the next generation. Change is inevitable. The key is recognizing the trend that is coming and being able to adapt and be ready for that change. 2D bar codes for asset visibility will soon be coming to all industries. As the old saying goes: It is not a matter of how or why, but when.

Ken Koldan is new business development manager for product identification at FLEXcon. Ken is on the Board of Directors of AIM North America. He also is chairman and founder of the UDI (Unique Device Identification) for Post-market Surveillance Committee and past chairman of the UDI Supplier Alliance Committee of AIM North America.

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