Clepa
Aftermarket Security Infrastructure
by
Jürgen Buchert
Sergej Toedtli
CEO – TecCom
CEO - Vesdo
1
MEMA Brand Protection Council Meeting
March, 12th 2008
Agenda
Introductions
Clepa – Aftermarket Security Infrastructure
Questions & Answers
2
TecCom…was formed by the Industry
1
2
3
4
5
6
7
8
9
10
Beru
Bosal
Bosch
Continental-Teves
Delphi
Federal Mogul
Hella
Herth&Buss
Johnson Controls
LUK Aftermarket
11
12
13
14
15
16
17
18
19
20
21
Magneti Marelli
Mahle Aftermarket
Mann+Hummel
MSI (Kolbenschmidt Pierburg)
Siemens VDO Automotive
Tecdoc
Tenneco
TMD Friction
TRW
Valeo Service
ZF Trading
© TecCom GmbH, 2007
3
Confidential. The Contents may only be passed on, used or made known with our express permission. All rights reserved.
Customers - a growing network
90
100
75
55
40
Manufacturers
25
2001
30
2002
2003
2004
2005
2006
2007
10.2
7.5
6.3
5.0
3.5
1.5
© TecCom GmbH, 2007
0.6
Wholesalers (000)
2001
2002
2003
2004
2005
2006
2007
4
Confidential. The Contents may only be passed on, used or made known with our express permission. All rights reserved.
No. of wholesalers (incl PoS) by regions
status 2007: 10.186
WD
new
2007
Europe
9.640
2076
South America
266
108
Asia
127
36
Middle-East
109
73
South Africa
44
19
© TecCom GmbH, 2007
Regions
5
Confidential. The Contents may only be passed on, used or made known with our express permission. All rights reserved.
TecCom Solution Portfolio
Inventory Management
F/cast, planning and replenishment process
Collaborative Managed Inventory (CMI)
Order Management
manage order to pay process
Collaborative Managed Order – incl. electronic invoicing
wholesaler
supplier
Category Management
synchronise master data
Collaborative Managed Data (CMD)
© TecCom GmbH, 2007
After Sales Management
manage claims and returns
Collaborative Managed Warranty and Returns (Pilot 2008)
6
Confidential. The Contents may only be passed on, used or made known with our express permission. All rights reserved.
Vesdo Ltd. …
• …is a company located in Wollerau
near Zürich
• …is a joint-stock company,
registered under Swiss law
• …has its roots in the Swiss
security tradition and security
industry
• …active in the brand protection
industry since year 2000
• …delivers engineering services
also in general applications of :
– Barcode technology and
deployment
– Track- and Trace technology
– Optimization of business processes
23.03.2016
Page 7
Competencies of Vesdo Ltd.
Security:
• Track- & Trace
Concepts/ needs/
specifications
• Security
technologies for
Technology:
• Barcode - Standards/Printing/
Reading/ Verification
• Supplier evaluation –
•
Specifications/ RFI/ RFP
Testing – own lab
authentication
Inf. technology:
• Database Concepts/
•
needs/ specifications
Communication for
security and T&T
landscapes
Business processes:
• Modeling - Methods & Tools
• Simulation - Partnership
• Validation / qualification
– FDA compliant
23.03.2016
Page 8
Vesdo Ltd. services
The backbone of our
business:
Engineering
• Confidentiality in all
activities
Consulting
Implementing
Testing
• Independence of any
suppliers
• Creative solutions (6
patent applications in
Security Track and Trace)
• 7 years of practical
experience in Security
Track and Trace
• Projects in the automotive,
pharmaceutical, fragrance
and tobacco industry
23.03.2016
Page 9
The Vesdo Ltd. laboratory
Our highly specialized laboratory:
The solid base for technical statements
• Evaluation of coding
technologies and its impact on
the coded substrate
• Feasibility of RFID deployment
• Readability (Verification and
Validation) of barcodes
• Evaluation of physical security
elements
• Basic research and testing of
new technologies
• Documentation of proposed
solution
23.03.2016
Page 10
MEMA Brand Protection Council Meeting
March, 12th 2008
Agenda
Introductions
Clepa – Aftermarket Security Infrastructure
Questions & Answers
11
An Industry Approach to Authenticating Automotive Parts
Experiences out of various projects in the European
automotive industry
by
Sergej Toedtli
Page 12
23.03.2016
Page 13
The dimension of product piracy in this industry
• Liability in case of quality problems
(accidents) can be extremely costly
• Brand image is affected with disastrous long
term effects.
• Lost revenue. Difficult to quantify, however a
significant loss for the company
23.03.2016
Page 14
Criminal activities are growing on an exponential scale
Gray market
diversion
Illegal
repackaging
Changing
expiry
date
Recyclin
g used
packages
Smuggling
Sales of
rejects
Sales of
used parts
Guaranty
fraud
Brand owner
Tampering
Theft
Upgrading
in product
family
Counterfeitin
g
23.03.2016
Page 15
Customs seizures statistics
9000
Seizures German Customs
8000
Growth rate 27%
7000
y = 585.7e0.2364x
6000
5000
Reihe1
Exponentiell (Reihe1)
4000
3000
2000
1000
0
1
2
397 498 5 99 6 007 01 8 029 03
10 04
11
1995
96
05
23.03.2016
Year
Page 16
23.03.2016
Page 17
Problems for dealers in selling counterfeits
• Primary victim of counterfeiters is the dealer as he
pay with hard currency for a wothless product
• Liability problem: Cheap products generate
technical problems and guaranty claims. The dealer
has no backup in form of a responsible supplier
• Bad quality ruins the reputation of a dealer.
• The dealer breaks hin contract with the original
product manufacturer.
• Selling counterfeits is illegal
A tool for easy authentication is needed
Page 18
Page 19
Main objective of fight against counterfeiters
1st Priority
2nd Priority
Ruin illegal business
Send crook to jail
Business action
Legal action
Page 20
Access to the supply chain has to be strictly controlled
• Code is the “ticket” for
using the supply chain.
Access control
• Security has to be
integrated in logistical code.
• Computer system can only
handle authentic products.
Supply
chain
Page 21
Enabling business partners
Providing a tool to the dealers &
distributors to allow for:
•
•
•
•
simple
fast
reliable
cost effective
authentication of products
Page 22
Page 23
Required properties of an anti- product piracy system
• Effective against specific form of fraud
• Protection against reproduction/ destruction
• Technical deployability
Benefit =
Protection degree of security device
Number of authenticated
items in relation to the
total amount of items
x Control density
Cost
Investments and
running cost
23.03.2016
Page 24
Basic principle of logical security and barcode structure
Every item gets an individual code
Today
Future
Anonymous mass of items
Every item gets its own identity
246 248 438 686
Code structure
(01)
EAN 13
13 digits
……Free space…(21)
Data Matrix
9 - 20 digits
Serialization
Page 25
Key elements of the coding recommendation
• Allows every CLEPA member to use codes for
authentication/ tracing without having the danger of
interfering with others
• Recommendation based on global coding standards
• Coding tailored to the specific needs of the aftermarket
industry
• Recommendation approved by standard organizations
GS1 and ISO
• Coding discussed/ synchronized with ODETTE and
VDA
• Leaves room for company specific adaptations
• Parallel initiatives in the pharmaceutical industry
Page 26
Benefits of combining logistics and security functions
PROFIT
• With one single scan in the supply chain,
logistical needs (e.g. materials entry) and
security requirements can be covered.
• Existing scanning infrastructures can be used.
• Printing of the security element (barcode) on a
logistical label does not create additional
running cost of label stock.
• The Data Matrix code can also be marked on
parts directly, allowing for optimizing internal
processes.
Logistics Security
• The security of the solution is given by a highly
protected database. The combination with
logistical functions is not affecting the over all
system security.
Page 27
Typical operational savings (examples) by direct marking of parts
• Identification of manufacturing site, subcontractor, manufacturing
line
• Support pairing of selected items during assembly
• Simplifies callback actions
• Permit permanent wait time analysis
• Allow for batch identification across complex manufacturing
structures
• Simplifies management of assignment stocks
• Allows for authentication of returned goods
• Reduces/ eliminates guaranty fraud
• Country of origin marking (Ursprungsbezeichnung)
• Marketing opportunities in form of a Bonus Programm (e.g. Rep
Page 28
Expert)
Security levels
Basic security level
Higher security level
Direct marking of parts
Coding folding boxes
?
Additional security
Features on folding box
Page 29
Comparison label/ hologram vs. barcode deployment
Barcode
Label / Hologram
Security (Combined
with logistical code)
Counterfeiting and
diversion
Counterfeiting
Application
Package and product
Package
Specific readers
Not required
Required for sufficient
security
Secured supply chain
Not required
Required
Investments
In IT-Infrastructure
In secure supply chain
Running cost per label None
Additional 3-5 € Cent
Industry solution
Company specific
Combination is possible
Page 30
Pilot project label
23.03.2016
Page 31
Track- and Trace reality – Protect the supply chain
Distributor
Dealer
Original
manufacturer
Trusted
supply chain
End user
Trusted
supply chain
Mandatory scanning
(Time/ location)
?
Unknown
source
Distributor
Dealer
23.03.2016
Page 32
Why an “industry solution”
• Cost sharing allows for:
– Minimized investments per user
– Low running cost for IT infrastructure
• Coding recommendation prevents chaos on
barcode level
• One single access point to the system allows:
– Dealers to authenticate a mixed basket of products
without problems
– Protection of the database being “mimicked” by
crooks
• Training of people working with the system will be
facilitated
– Dealers
– Customs
– …..
Page 33
Architecture of an authentication system
If each manufacturer is
operating his own track and
trace system:
Business processes at the
POS will be very
complicated.
Using a hub as unique
certification authority in an
given industry:
Business processes at the
POS will be simple and
easy.
Page 34
Authentication process
 single
 online
 mobile
 pallet
 local
 online
 batch
Confidential.The Contents may only be passed on, used or made known with our express permission. All rights reserved.
35
© TecCom GmbH, 2007
2D matrix
code
 local
data
base  central
“www.tecidentify.com”
© TecCom GmbH, 2007
36
Confidential.The Contents may only be passed on, used or made known with our express permission. All rights reserved.
“www.tecidentify.com”
© TecCom GmbH, 2007
37
Confidential.The Contents may only be passed on, used or made known with our express permission. All rights reserved.
Screenshot TecIdentify
© TecCom GmbH, 2007
Confidential.The Contents may only be passed on, used or made known with our express permission. All rights reserved.
38
First Movers
target 2008: 25
1 Bosch
13 Contitech - March
2 Continental Teves
14 ThyssenKrupp
3 Federal Mogul
15 Knorr Bremse - March
4 GKN
16 Osram - March
5 Hella (2008)
17 Valeo
6 Mahle (2008)
18 VW
7 Mann + Hummel (2008)
8 Schaeffler, LuK, INA
Int. trade Groups
9 Tenneco
Figiefa
10 TRW
MEMA
12 ZF-Trading
Decision open
39
Confidential.The Contents may only be passed on, used or made known with our express permission. All rights reserved.
© TecCom GmbH, 2007
11 Wabco (2008)
MEMA Brand Protection Council Meeting
March, 12th 2008
Agenda
Introductions
Clepa – Aftermarket Security Infrastructure
Questions & Answers
40
Thank you!
Jürgen Buchert
Sergej Toedtli
CEO – TecCom
CEO – Vesdo
juergen.buchert@teccom.eu
+49 (89) 321 216 150
toedtli@vesdo.com
+41 (44) 787 39 55
41
Back up
© TecCom GmbH, 2007
Confidential.The Contents may only be passed on, used or made known with our express permission. All rights reserved.
42
Architecture of global IT- network
Public authentication
Public hub
PSTN
Internet
Authentication within supply chain
Secure hub
T&T
T&T
T&T
Page 43
The only function of the hubs is routing the queries
Customer
Public hub / Secure hub
Manufacturer DB
Company 1
Company prefix
Address
registry
+Location
Address:
Company 1
Query
Registering
query &
GLN
Accepted Yes/No
DB
• No sensitve company (sales) data stored
on hub !
• High security and high performance due
to distributed architecture.
Company 2
Company n
23.03.2016
Page 44
Manufacturers cost for operating the CLEPA security system
Product coding
Level of functionality
Investments
Running Cost
Buy labels from external printer
------
1.75€/ 1000
Stand alone printers & manual data collection
€ 1’600.- 1) per
printer (SW)
€ 500.- per printer
(SW)
Managed printing: Central console for internal and
external printing incl. automatic data collection
€ 100’000.- to
€ 150’000.-
Reduction of label
printing cost
Track- & Trace on package level
6 digit €
5 digit €
Direct coding of parts, coding folding boxes and
Track- & Trace functionality
7 digit €
6 digit €
1)
Reduced price for software in larger quantities to be negotiated.
Clearing hub
Functionality
Clearing center TecCom
Investments
€ 9’000.-
Cost
€ 9’000.-/ Year
Page 45
Project time table
First contact
Draft of recommendation
Approval
IT-Concept
CLEPA decision
Clearing center realized
Roll out “first movers”
2006
2007
2008
Page 46
Participating “first movers” companies
1. Bosch
11. TRW
2. Continental Teves
12. ZF-Trading (Präs.11.10.2007)
3. Federal Mogul
13. Wabco (2008)
4. GKN
5. Hella (2009)
6. Mahle
7. Mann + Hummel (Präs.10.10.2007)
8. Schaeffler, LuK, INA
9. Tenneco
10.TRW
Page 47
VESDO:
toedtli@vesdo.com
+41 (44) 787 39 55
Page 48