A pallet probably isn't the first image that comes to mind when you think about cutting-edge applications for wireless technology in the warehouse. Nonetheless, the pallets in one Florida facility have indeed gone high-tech, sporting radio-frequency identification (RFID) tags and antennas embedded in their plastic lead boards (the deck boards located at a pallet's edge) to track their whereabouts.

These pallets are part of a pilot program now under way at a Florida repair center operated by CHEP, an international pallet and container pooling company that manages more than 160 million wooden pallets worldwide. Tracking those pallets can be a logistical nightmare, says Brian Beattie, the company's senior vice president of marketing, which is what led CHEP to participate in the RFID pilot. "Each time we send a pallet from our warehouse to a manufacturer, we'll automatically read the RFID tag," he says. "When the pallets come back to our depot, we'll automatically read the tag again."

CHEP expects several benefits from the data produced by the RFID tags and a tracking system from Savi Technology of Sunnyvale, Calif. An accurate measure of how long the pallets were in use will lead to better billing practices. CHEP can also use the tags to trace damage to specific users. "We can even work with our customers on best practices to reduce damage and identify lanes in the supply chain that just aren't profitable," adds Beattie.

Yet collecting data is just the first step in CHEP's vision of managing pallets with wireless technology. Install RFID readers in customers' facilities, and CHEP could provide global visibility of the goods on those pallets right down to the stock-keeping unit (SKU) level. Says Beattie: "We feel strongly that the technology will help us to take dollars and inventory out of the supply chain for our customers."

The CHEP project illustrates the evolution of wireless applications in warehousing and supply chain management, which can be summed up by the title of the Beatles' song "Here, there and everywhere." If current trends continue on track, real-time information about inventory, orders and shipments will someday be available to anyone who needs it anywhere in the supply chain. And in the perfect wireless world, the flow of information would be seamless, inside and outside the warehouse.

"Supply chain visibility of timely and accurate information is the driving force behind wireless today," says Adrian Gonzalez, an industry analyst with ARC Advisory Group of Dedham, Mass. "A logistics manager wants better control over carriers and shipments. The warehouse manager wants better control over inventory. A customer service rep wants to provide customers with order status updates. The board wants a scorecard [showing] where things are moving and where they are standing still."

"When people start listing what they want in the warehouse, they don't start with wireless connectivity," adds Sarosh Vesuna, director of technology alliances and business development for Symbol Technologies. "They start with the need to control the flow of inventory and information through the warehouse and the supply chain. But it's wireless that makes those possible."

How does wireless technology achieve this connectivity? Right now, RFID tags, bar codes and wireless data collection devices are the front-line technologies that enable mobile workers to capture product and inventory information at the point of a transaction. But to understand the way wireless applications in warehousing are evolving, you first need to be familiar with the three different, but increasingly connected, networks to which that information can be transmitted: LANs, PANs and WANs.

Wireless communication in the warehouse isn't new. LANs, or local area networks that operate within a defined geographic area, have been a fixture in warehousing for years.

Yet things have changed in the last decade. The wireless network of the past was a proprietary system. A handheld bar-code scanner from Symbol, Intermec, Psion Techlogix or LXE worked only with radios from those same manufacturers. The software running the systems was also proprietary to a manufacturer's systems.

Today the name of the game is standardization, thanks to the 802.11 and 802.11b standards for LANs introduced two years ago by the Institute of Electrical and Electronic Engineers (IEEE). These new standards, plus a faster 802.11a standard, which will be introduced later this year, will bring about a complete change in the way many companies think of wireless solutions, if not now, then for the future.

For starters, wireless devices designed to the 802.11 standard are interoperable with any other device certified "Wi-Fi" compliant by the Wireless Ethernet Compatibility Alliance, or WECA, regardless of who manufactured them. "Wireless isn't going to happen unless all of the people in the supply chain are comfortable that the equipment they buy is going to work on the infrastructure they've created," says Vesuna, a founding member of WECA. "The idea is that whether you understand the technology or not, you can pick up a piece of equipment and it will work with any other piece of equipment, regardless of the manufacturer, if it's Wi-Fi certified."

Since last April, some 239 wireless devices and products from 61 separate companies have completed the Wi-Fi certification process—a development that has changed the marketplace considerably. "We used to tell customers how great our proprietary radios were compared to our competitors'," says Bill Roeder, senior vice president of LXE Inc. of Norcross, Ga. "Now, we ask clients whether they'd like a Lucent or a Cisco radio because we can work with either."

Today's LANs are faster than their predecessors. An 802.11b LAN operates at speeds of up to 11 megabytes per second (Mbps), nearly 100 times faster than traditional LANs. The new 802.11a standard will be nearly five times faster, transmitting data at 54 Mbps—fast enough to share audio and video over the wireless network.

Furthermore, mobile devices have evolved from dumb terminals to truly mobile computers running on DOS, Windows CE or Palm operating systems. "Put a Pentium-based device with a Windows operating system and an 802.11 connection on a fork lift, and you've got a mobile unit that's as powerful as any other computer in the building," says Roeder. "We have users who are doing that."

Warehouse management systems (WMS) vendors are taking advantage of advances in wireless technology to make their systems accessible by Web-enabled personal digital assistant (PDA) or cell phone. "You're putting the power of the WMS literally in the hands of warehouse managers, regardless of whether they're behind their desks or on the warehouse floor," says Chris Heim, CEO of HighJump Software, which is just one of several leading WMS vendors to offer wireless access to their systems.

When it comes to capturing the data that will be shared across a LAN, RFID applications, like the one in CHEP's pilot, are still in their infancy. The primary reason is the relative cost of the technology. Although RFID readers can automatically read hundreds of tags at once and operate in hazardous environments with poor sight lines, they are still expensive compared to bar codes. For that reason, they have primarily been used to track high-value assets or large items like rail cars and cargo containers.

Yet that is changing. "RFID is finally gaining prominence around niche applications, like tracking returnable containers through a facility," says Adrian Gonzalez of ARC Advisory Group.

Ford, for instance, is using a real-time locator system from WhereNet, a Santa Clara, Calif., company, to track transmission racks in an assembly factory. "Bar-code scanning and a WMS do a great job of tracking inventory in standard racking," says Tom Turner, a senior vice president of WhereNet. "But when companies implement lean manufacturing, inventory goes right from the trailer to the manufacturing floor in containers. Knowing where those containers are located when you need them can be critical to keeping the line moving."

Post-Sept. 11, Gonzalez sees new opportunities for RFID technology for cross-border shipments. Once a trailer has been loaded, information about the contents of that shipment can be written to an RFID tag in the warehouse. The RFID tag can then transmit that information to a customs agent to streamline border crossings, or to monitor whether the trailer has been opened after it was electronically sealed. When it arrives at its destination, the RFID tag would allow the contents to be automatically received in the facility's WMS system without human intervention.

A key to creating real-time supply chain visibility is the ability to collect data at the point of the transaction. That is a challenge, especially when warehouses are called upon to assemble orders or where work stations are reconfigured on the fly to accommodate value-added services on a changing product mix.

Bluetooth, an emerging short-range wireless technology, allows mobile devices to talk to one another without cables. Think of it as a personal area network (PAN).

A PAN creates a network within a network. In an office, a computer might be connected to the company Ethernet. Bluetooth, however, might be used to connect a cordless mouse, printer and monitor to the computer.

In the warehouse, the same technology allows a mobile worker to take his tools to the point where the work needs to be done without cables. A bar-code scanner, for instance, may receive instructions from the WMS over the facility's 802.11 LAN. However, the scanner communicates with the worker's portable printer through the Bluetooth network. "The point is to empower the mobile worker," says Jeff Kaufman, director of product management for Zebra Technologies, a Vernon Hills, Ill., manufacturer of printers. "With Bluetooth, you can take the printer and the mobile worker to the point of the application without rewiring a work center and without cables."

Although the point of emerging wireless applications is connectivity here, there, and everywhere, there are still black holes in the supply chain, even with a wired warehouse and wireless access to the WMS from a PDA and cell phone. For instance, once an order leaves the warehouse on a truck, only the largest carriers have the capability to track and trace orders en route to their next stop.

For that, you need a WAN, or wide area network that connects local area networks together to provide broad coverage.

In the not too distant future, that may change as the costs of both air time and global positioning technology through a satellite connection drop. Radcliffe Systems, a Toronto-based provider of supply chain execution solutions, is developing a tracking system that will marry the RF technology used when a truck and trailer are in the yard with satellite communication for when the truck is on the road. The system would provide real-time communication as well as track and trace capabilities down to the SKU level.

Symbol Technologies is introducing dual-mode mobile computers that will operate on both an 802.11 wireless LAN within a facility and over a wide area network on the road. "From a user's standpoint, there shouldn't be anything that interferes with the seamless data-transfer operation," says Vesuna. "When the truck pulls into the warehouse, it can upload and download information over the LAN. Once it leaves the facility, it can continue to communicate with the system through a WAN—over a cellular network or a satellite."

Make no mistake about it: Although the technology exists today to create a wireless supply chain, we are still in the early adoption phase of a wireless revolution. Many companies have already made significant investments in existing systems that get the job done for now. In a tough economic environment, they're not likely to rip those systems out all at once to start over without a quantifiable ROI.

"Traditional handheld devices, cell phones and PDAs have all been enabled for RF, mobile computing and scanning," says Michael Bittner, research director, supply chain strategies for Boston-based AMR Research. "It's interesting stuff. But enterprises need to find a clear-cut value proposition for deploying the technology, and that's where there's been a gap."

In the meantime, however, wireless developments cannot be ignored. "Everyone is talking about wireless, RFID and cellular solutions," says Adrian Gonzalez of ARC Advisory Group. "One day, those will be here, and warehouse and logistics professionals need to keep that in mind when they're implementing solutions so there's a smooth transition when that day arrives."