The movement toward radio frequency identification (RFID) in logistics got a big shove recently when the Department of Defense (DoD) announced that as of Jan. 1, 2005, it will require electronic product code tags on many items shipped to the military.

The initiative begins with the department's "Policy for Unique Identification (UID) of Tangible Items—New Equipment, Major Modifications, and Reprocurements of Equipment and Spares," which applies to all solicitations issued on or after January 1, 2004.

The UID mandates item-level identification codes for virtually all supplies. Those codes may take a variety of forms, including linear bar codes, dot-matrix symbols, and ISO/IEC-standard marking, along with human-readable labels, depending on the type of item and the supplier. (The DoD has said it is embracing "open architecture" rather than trying to create a single government standard.)

The new requirements are designed to integrate data across military department, federal government, and industry systems to better manage inventory and item-level tracking as well as improve accountability. By 2005, the UID program will cross over to an RFID-based standard.

But the DoD's demand that suppliers acquire and implement sophisticated tracking technology faces the same potential hurdle that met mega-retailer Wal-Mart's announcement earlier this year that it would require its top suppliers to jump on the RFID train. The question is whether all of the agency's suppliers, including small vendors without the deep pockets needed to invest in new technology, will be able to comply on time—if at all?

Because the DoD's supply chain is different than its retail counterpart, it will be easier for suppliers to comply, predicts auto ID expert David Krebs, group director with market research firm Venture Development Corp. in Natick, Mass. "It's not dealing with as many parties," he explains. "It could be described as more of a closed supply chain as compared to Wal-Mart. The dynamics are different in terms of the overall volume."

The UID program specifies criteria for when a unique identifier is required for an item. Those criteria include acquisition cost, how the item is managed in inventory, whether it is reparable or consumable, and whether it is a component of a previously delivered item, among other factors. Some discretion is also left to program managers, and items costing less than $5,000 are subject to a "decision tree" process to determine if they need to be ID'd.

Just as happened with Wal-Mart, the timeframe of the DoD's proposal is being questioned. The January 2005 target date that is worrying the retail giant's suppliers may also trouble military vendors. "I don't think all suppliers are going to be compliant," says Steve Banker, service director, supply chain management, for ARC Advisory Group in Dedham, Mass. "I think there will be a fair number of people contacting the military and saying, 'please bear with us, we're working toward this but we're just not there yet'."

Ready or not, though, RFID is coming, and now it has powerful twin engines behind it. How quickly suppliers will be able to comply with the new requirements remains to be seen.

Editor's Note: For more information about the UID program, go to www.acq.osd.mil/uid.