The Moraitis Diaries

Part I Vegetable Soup(ed) Up

How a greengrocer takes a greenfield site and grows its IT network (CIO June 2004)

With full executive support, Moraitis CIO Con Colovos leads the fruit and vegetable giant through the challenge of an extensive IT makeover.

Part II Sowing the Seeds

With the infrastructure, networks and IT skills in place, Moraitis is ready for ERP (CIO September 2004)

Colovos and his team have until February next year to get phase one of the $3 million program up and running, which includes reformation of many processes that the largely blue-collar workforce had been comfortable with for years.

Fresh Produce

Future proofing the business is a key challenge for CIOs. This third instalment in the Moraitis story finds the fruit and vegetable supplier piloting RFID and edging closer to the rollout of its new ERP platform, with one eye firmly fixed on the future.

If Con Colovos needed convincing that barcode tracking systems are fallible, then his recent fact- finding trip to Europe provided the goods. His luggage, duly barcoded and loaded in Europe, never made it back to Australia and is still out there somewhere, unloved and unlocated. If the airline and baggage handlers had used radio frequency identification (RFID) he might still have had his luggage.

"I recently went to RFID conference in Sydney and one of the speakers was the head of IT services for San Francisco Airport that utilizes RFID tracking luggage in and out of the airport. He said that the ability to identify and track luggage has increased tenfold," says Colovos, the CIO of fruit and vegetable supplier Moraitis.

As part of the information systems overhaul that Moraitis is undergoing, Colovos is now rolling out a pioneering RFID system that will be a precursor to a company-wide rollout, once that is mandated by big clients such as Woolworths and Coles, which he firmly believes will happen. RFID is expected to significantly streamline the supply chains in all sectors - as soon as the technology becomes affordable and better understood.

So far though, at least in Australia, there is a lot of tyre kicking going on. A survey of local companies called From Barcode to Electronic Code, sponsored by Gillette, ECR Australia and Accenture, and released earlier this year, found that four in five Australian retailers had appointed RFID "champions" to work with the technology in their business. However at the time of the report, only a handful of companies were running trials - among them packaging companies Amcor and Visy and retail giant Coles Myer.

Coles's is the first trial of RFID for the Australian retail sector. Begun in May 2004 the pilot involves tracking RFID-tagged roll-cages between a distribution centre at Hampton Park in Melbourne and a supermarket in Glenferrie. The roll-cage tags are scanned as they leave the distribution centre and as they arrive at the supermarket. According to Peter Mahler, CIO of Coles Myer, although RFID systems are clearly cutting edge, the company still needed to be assured that using RFID would deliver bottom-line benefits. As he put it: "What we are testing through this trial is the idea that they [RFID] can deliver a better, simpler, cheaper service in our busy supply chain."

If the reality lives up to the promise, the moment one big retailer rolls out RFID its rivals will be forced to follow suit or forego the competitive edge, and suppliers will be sent scrambling to integrate RFID. The report suggests the adoption window for retailers to move to RFID will be from two to five years. In the meantime, many retailers are still using barcodes to refine their supply chain before taking the RFID plunge, attracted no doubt in part by the lower set-up costs.