SPOTLIGHT ON 2D

Logistics Insight Asia, 1/11/2007

Standards, regulatory requirements, business needs, and new technology advances are driving 2D bar code adoption throughout the supply chain.

By JACK TAY.

Two-dimensional bar codes have quietly revolutionized many production, tracking and maintenance processes. Now, 2D bar coding is undergoing a revolution, thanks to important scanning technology advances and growing use in multiple industries. 2D applications are being adopted at more than double the rate of traditional 1D bar code technology, according to market research firmFrost & Sullivan.

Adoption is growing because companies are taking a fresh look at how 2D bar codes can meet their information, identification and traceability needs. The fundamentals of 2D technology capabilities, limitations and compatibility with legacy bar code processes have changed– and have changed faster thanperceptions about the technology.Companies who have reexaminedwhat 2D can do are benefitingfrom the effort.

Until recently, 2D was widely considered a “niche” technology beneficial only for a few industries and processes. This perception has outlasted reality, because 2D adoption today is increasingly varied and widespread. Twodimensional bar codes have always given organizations a reliable way to include information associated with a shipment, product, part or component, and are often the only practical option for accurate smallitemidentification.

Each month thousands of new products are marked with 2D codes for the first time as a result of initiatives in the pharmaceutical and defense industries, and an emerging standard has set the stage for millions more consumer products to carry 2D symbols. MORE THAN A NUMBER 2D symbologies have enough capacity to include intelligent data that can be used to drive decisions and processes in environments where traditional information systems don’t reach. In fact, they are sometimes referred to as“portable databases” or “portabledata files.”

Most traditional 1D applications use the bar code symbol as a “license plate” to encode a reference number to access information held in a database. License plates on cars do not tell the make and model of the vehicle or identify the owner. The plate number simply provides a unique number that corresponds to a database record with the information. Most 1D bar code applications are built on the same principle, which means the data encoded in the bar code has no use or value if it can’t be associated with a database record. One of the great values of 2D symbols is that they can encode enough information to drive applications that do not need database access. For example, in field service applications, technicians with no remote database access can simply scan a 2D code on a piece of equipment to get all the identification and configuration information necessary to complete the service work.

As Frost & Sullivan Research Analyst Priyanka Gouthaman explains, “Manufacturing segments requiring high levels of visibility into individual parts tracking and automated assembly processes expect to be the largest end-user segment of 2D bar code. Products involving stringent documentation requirements throughout their supply chain movement also adopt data-dense 2D symbologies.”

The consumer goods and pharmaceutical industries also take advantage of 2D bar coding as an alternative to database access. Many consumer goods and pharmaceutical manufacturers use 2D bar codes to supplement identification labels with lot codes and expiration dates.

The data is used throughout the supply chain to support many decisions and processes to ensure proper stock rotation, expedite shipments, remove unsaleable products from inventory and facilitate efficient tracking and recalls.

Because the data travels with the products, access to the product manufacturer’s information systems is not required for these applications. Logistics providers, wholesalers, retailers and other organizations in the supply chain can get the product identification and expiration data they need directly.

SET FOR 2010
Matrix codes occasionally appear on consumer goods packaging to supplement the UPC/EAN symbols with batch or lot codes and for product authentication. Now GS1, the international standards body that created the symbology and also manages the UPC/EAN system, is bringing 2D coding into the retail mainstream.

GS1 has established January 1, 2010 as the “sunrise date” for requiring scanners used at the point of sale and other retail operations to read and decode GS1 DataBar symbology bar codes. The GS1 DataBar family includes both “stacked” and “composite” 2D bar codes that can be used to encode standardized application identifiers (AIs), including lot codes and expiration dates, and others that can support enhanced security through authentication and traceability. GS1 estimates 85 percent of retail scanners will be DataBar capable by 2010.

GS1 made the decision to require DataBar after receiving extensive input from manufacturers and retailers who felt UPC/EAN symbols were too large and inflexible for encoding the information they wanted. In its business case analysis for DataBar (see www.gs1.org), the organization asserts users can get a positive return on investment through reduced packaging, improved identification of small, loose and variable-measure items, improved category management, and by taking advantage of improved traceability enabled by additional data encoding.

RISING IN PHARMA
Widespread 2D item identification may occur even sooner in the pharmaceutical and healthcare industries. In the US, numerous state and federal drug pedigree requirements have recently been enacted or are pending.

The FDA already requires medications to be dispensed in hospitals to be marked with a 1D bar code encoded with the National Drug Code (NDC) number. It stopped short of requiring lot codes and expiration dates but noted there are many beneficial reasons for encoding and scanning this data and 2D symbologies are an effective enabler.

2D symbols are also used on patient wristbands and this application is also poised to grow rapidly. Linear bar codes have proven problematic because of the curvature of the wristband, making reading difficult. Compact 2D symbols avoid this problem, plus they have the capability to encode more information than the patient identification number.

INDUSTRIAL POTENTIAL
Reliable performance on curved surfaces is also one of the many reasons 2D matrix codes are the symbols of choice for industrial marking and tracking applications. Even when produced at sizes small enough for electronics components and other small items, Data Matrix and other 2D symbologies have the capacity to encode a unique serial number, lot code, configuration data, time stamps and other production information.

Small 2D symbols can also be read reliably with handheld or unattended fixed-position imagers in a variety of industrial settings including automated routing and assembly, WIP tracking, quality control testing, product genealogy and lifetime tracking.

There are numerous 2D standards to support traceability and manufacturing automation in the aerospace, automotive, defense, electronics, semiconductor, telecommunications industries.

Some of the best-known examples include SPEC 2000 in aerospace, AIAG B-11 in automotive, UID from the U.S. Department of Defense, and numerous electronics standards from the Electronics Industry Association (EIA) and the Semiconductor Equipment Manufacturer’s Institute (SEMI).

Many of these standards and marking initiatives are driven by the desire to provide cradleto- grave traceability of parts, assemblies and components.

Make-to-order and just-in-sequence manufacturing require more than basic identification and often need components to be marked with serialization, sequence or configuration information.

Organizations throughout the supply chain, including suppliers, product manufacturers, service providers, packagers and distributors can all take advantage of the standardized information to exchange information and create their own records management applications – with no central database access required.

TECHNOLOGY ADVANCES
Until very recently, technology limitations with area imaging often made it impractical for organizations to transition from legacy 1D bar code applications to use 2D symbols. Laser scanners cannot read all 2D formats. Area imager scanners, which excel at 2D reading, could not read 2D codes at distances greater than an arm’s length.

Selecting a scanning technology for two dimensional bar codes has historically required making tradeoffs, because no single scanner was able to provide all the symbology support, range, reliability and speed required in real-world environments. Would-be users faced a choice of supporting multiple scanning technologies, or a single bar code technology. 2D adoption lagged as a result and its perception as a niche technology lingered.

Area imagers read bar codes by capturing a full image of the symbol and using image processing software to decode. They provide excellent performance for bar code reading, because they can read traditional linear, stacked and matrix symbologies in any orientation. Omnidirectional (orientation-independent) scanningcapability means users don’t have to arrange or align bar codes toread them, which results in moresuccessful first-time reads.

Despite this flexibility, area imagers have had limited adoption because of their traditional range restrictions. The same scanner used to read a 2D part mark couldn’t also read the location code of the warehouse shelf the part was picked from. That limitation led to application tradeoffs that stifled adoption.

But with the development of a new generation of area imager scanners, these tradeoffs are now going away. Newly released area imagers are now available that can read both linear and 2D bar codes at short and long distances, which opens up a whole new set of opportunities.

Area imagers are gaining the performance and price benefits resulting from the competitive innovation and economies of scale that have been driven by advances in digital photography, particularly from the explosion in cell phone photography.

Intermec, for example, has leveraged some of these developments in its R&D to produce the Intellibeam EX25 Area Imager, the scan engine capable of reading stacked 2D, matrix 2D and 1D bar codes in any orientation at both close and long range.

What this means is that the same scanner can be used during one shift for work-in-process tracking and other close-range scanning, and used again by another shift for picking and putaway operations. This makes it practical for manufacturers to encode lot codes, serial numbers, configuration data or other variable information on the products they are packaging to supplement traditional 1D bar codes used for inventory and shipping applications.

For example, an auto parts manufacturer took advantage of the Intellibeam EX25 to improve parts traceability and preserve some legacy bar code operations, switching from marking individual parts with 1D linear bar codes to 2D Data Matrix symbols that encode more specific variableinformation.

Even with numerous symbologies in use, including UCC/EAN, Code 39, PDF417 and Data Matrix, and bar code sizes ranging from very small product ID symbols to very large location labels, the manufacturer was able to capture individual part data with the same scanners used to receive incoming materials, track work-in-process and scan outbound shipment labels.

Jack Tay is Regional Marketing Manager, Intermec Asia Pacific, (www.intermec.com).

2D bar codes

2D bar codes with serialization, sequence orconfiguration information

latest area imagers

STACKED & MATRIX There are two main categories of 2D symbologies – stacked and matrix – and many individual symbologies within these categories. The primary differences between stacked and matrix symbols are how they are encoded and how they can be read. Stacked symbologies are made up of two or more rows of linear bars and spaces. They take their name because they can resemble a series of small linear bar codes that have been stacked on top of each other. Leading stacked symbologies include PDF417 (illustrated), Code 16K, Code 49 and a version of GS1 DataBar formerly known as RSS Composite. Laser scanners, linear imagers and area imagers are all capable of reading stacked symbologies, although not all readers can process all symbol sizes. Matrix 2D codes encode data in dark and light geometric elements arranged in a grid. The position of each element relative to the center of the symbol is a key variable for encoding. Matrix symbologies are most commonly used for small item marking, and also for unattended and high-speed reading applications. Common examples include Data Matrix, MaxiCode, Aztec Code, Code One and QR Code. Matrix symbologies are decoded by processing the complete image to determine each element’s relative position. Laser scanners cannot read matrix codes because they cannot view the entire image at once – area imaging is the only bar code scanning technology capable of doing so. A major advantage to using area imagers is that matrix and other bar code symbols can be read in any orientation. Matrix 2D codes

2D IMAGERS GAINING MARKET SHARE A new study out from Venture Development Corporation (VDC) reveals that global shipments of 2D bar code imagers accounted for US$119 billion out of a total 2006 handheld scanner market size of $810 billion. And going forward, growth for scanners based on imaging technology rather than lasers is expected to accelerate due to declining price points and enhanced performance capabilities. Although laser scanning remains the dominant technology in all industries, price-sensitive markets (health care, retail) as well as manufacturing environments continue to adopt imagers due to their lower cost, greater durability, and ability to encode/read more data. In particular, the industrial/manufacturing sector continues to adopt 2D imager solutions, particularly for reading direct part markings (DPM) of Data Matrix in the automotive and aerospace industries. 2D symbology is also being used for labeling on space-restrictive products such as pharmaceuticals and printed circuit boards (PCBs). Even so, VDC points out that although the growth of the laser scanners has diminished over the past few years and continues to lose share to imaging technologies, particularly 2D, it is still exhibiting growth rates (CAGR) in excess of nine percent for more rugged environments such as manufacturing, fi eld sales/service and health care. And laser scanners are still preferred for applications that require long read ranges (greater than 4.5 meters). In 2006, Asia Pacifi c accounted for $157 million of the $810 million handheld scanner market, versus $377 million in the Americas and $275 million in EMEA. But Asia Pacifi c, particularly China, Taiwan, and Korea, is expected to maintain the strongest growth over the next fi ve years from further penetration of less mature markets and the increasing number of Tier-1 fi rms establishing domestic manufacturing facilities in pursuit of lower labor costs and other operational effi ciencies, says VDC. Share graph