Cracking the RFID Shell

December 1944. The town of Bastogne, Belgium, is under siege by the German army. An ultimatum is sent to General Anthony McAuliffe, commander of the Allied forces defending the town, demanding surrender. General McAuliffe's written response is a single word: "Nuts." McAuliffe becomes the embodiment of U.S. guts, determination, and in the end, triumph, as the Nazis are held off. Fast-forward almost 60 years. Paramount Farms, the world's largest vertically integrated supplied of pistachios and almonds is besieged by skyrocketing demand for its products. The company's Grower Receiving System is outdated and buckling under pressure. Like General McAuliffe, however, Paramount commanders refuse to surrender, choosing instead to deploy a Grower Receiver System (GRS) that incorporates Radio Frequency Identification (RFID) and handheld PDAs, saying, "Nuts," to anything but success.

Good Problems
Paramount Farms was experiencing what some might call a "good" problem. According to USDA statistics, almonds are the number-one U.S. horticultural export and the sixth-largest U.S. food export, and demand has doubled within the past decade. California supplies 100 percent of U.S.-grown almonds. At the same time, the United States has become the world's second-largest producer of pistachios (behind Iran), with California producing 98 percent of the American crop. Paramount Farms is the largest almond grower in California, and processes about 60 percent of the U.S. pistachio crop. Of that 60 percent, Paramount Farms grows about half, with the rest coming from a network of nearly 400 grower partners. All told, Paramount processes about 230 million pounds (dry weight) of nuts annually.

"The big challenge with a pistachio harvest," according to Dave Szeflin, Paramount Farms' vice president of operations, "is that once it starts, there's no way to stop it. In our average harvest season, incoming green product totals a half-billion pounds over a 6-week period. Given this time constraint, as we increase our production goals, our efficiency and productivity must also increase," Szeflin says.

Weight Gain
"The scope of our pistachio receiving operations at harvest is huge," says Andy Anzaldo, director of grower relations at Paramount Farms. "We receive 400 loads a day, each about 50,000 pounds of gross green weight. With this kind of volume, our GRS is one of the most critical points in our supply chain."

The legacy system at Paramount Farms was unable to keep up. Anzaldo reports that the system couldn't interface with desired technologies, including RFID, bar codes and handheld PDAs. So the decision was made to reengineer the entire receiving process and implement technologies that, as planned, should handle the company's projected growth in volume for the next decade. A management team was formed to oversee the deployment, including Szeflin and Anzaldo, along with CIO/vice president of logistics Curtis Hudson, the IT staff and a group of managers responsible for grower receiving functional areas. The team evaluated the legacy system's shortcomings and established objectives for the new system.

"One of our goals was to identify key performance indicators (KPIs) of the receiving, grading and grower payment processes, including grower turn times, number of loads processed and grading accuracy," explains Szeflin. "Once the KPIs were determined, we needed to plan for the hardware and software tools needed to track and report our performance against those metrics."

Universal Challenges
Although this may sound very agricultural-specific at first, the essential problems faced by Paramount Farms are familiar to virtually every business that deals in a commodity, from computers to candy bars. Shipments arrive, sometimes in seemingly overwhelming volumes (think Christmas), and must be processed accurately, the goods evaluated and moved to the next step in the supply chain, and vendor accounts settled. These are problems faced by virtually every growing enterprise.

Paramount Farms' solution, worked out in partnership with MagTech, uses Microsoft's .Net technologies as the GRS foundation. Client stations must use a compliant Internet browser (such as IE), but that's the only requirement. As a trailer arrives at the Paramount scale house (receiving point), its Intermec 915 MHz RFID tag is interrogated by an Intermec Intellitag ITRF fixed reader. The Intellitag reader transmits this information to the central server via an Intermec 2100 Universal Access Point. The backend Microsoft SQL 2000 database relays the prerecorded profile of the trailer back to the scale house worker's Intermec 710 handheld computer, which displays the trailer's net weight, license plate number, equipment number and owner's name.

Harvesting the Data
The Intermec 710 handheld is then used to gather and transmit load details to the central database, using pull-down menus to select the grower's name, ranch, field, product temperature and harvest method. The trailer's gross weight is automatically retrieved from the truck weigh scale, and a weight certification is printed. This information is then used to prioritize trailers as they arrive at the processing facility, and the time that passes from a load's arrival to its processing is recorded and reported to grower partners. "Our objective," Anzaldo says, "was to make the entire process transparent to our grower partners. This will further strengthen our relationships, while driving down costs, reducing communication transaction times, and minimizing open issues and discrepancies encountered during the harvesting and receiving season. The new receiving and payables tools have already resulted in a tremendous improvement in data accuracy that surpassed our expectations," he says.

Final Analysis
Paramount Farms estimates that the system has helped reduce trailer usage by 30 percent through faster analysis of RF tags and optimization of equipment scheduling and resource utilization. By reducing the amount of paperwork and manual data entry steps, transaction time for initiating a new load has dropped by 60 percent. This has allowed Paramount to eliminate plans for scale house expansion, a major capital savings. And the company believes the increased production goals will be met without having to increase labor resources.

Flush with success, Paramount is already looking ahead. "In the more distant future," Anzaldo reports, "the step would be to automate payment through electronic funds transfer from our bank to the growers'. That would make everyone happy."

And no one, not even a besieged general, would say, "Nuts," to that.