UID Spells Opportunity For Smart Government Contractors

(The Property Professional, Vol7.Number2, The National Property Management Association)

After many good intentions and false starts, beginning with the Chief Financial Officers Act of 1990, it is happening: the Federal Government is leading the charge toward improved fiscal management through visibility and accountability. Property managers stand at the forefront of the accountability movement. Those who get on board with compliance and understand the implications of successful UID implementation will see their roles grow in stature and importance. The far-reaching implications of the accountability movement will ripple through industry, creating a paradigm shift similar to the use of bar code in the retail industry several decades ago.

UID Overview
The Department of Defense (DoD) has adopted The Policy for Unique Identification (UID) of Tangible Items – New Equipment, Major Modifications and Re-procurements of Equipment and Spares, announced by Michael Wynne, Acting Under Secretary of Defense, in July 2003. This landmark policy requires all assets and personal property owned by the DoD, including assets in the possession of contractors, to be marked with a unique serialized identification number (UID) effective January 1, 2004. This applies equally to legacy and newly requisitioned government furnished property (GFP), with the goal of placing 100% of GFP in the new UID registry.

The purpose of the UID mandate is to achieve visibility of all assets for continuous reporting to the military’s wide-area workflow (WAWF) system. This will enable better management of components of complex DoD systems over their complete life cycle. Now all maintenance, transportation and supply-related processes will be captured electronically in order to provide intelligent data for knowledge-enabled logistics. The collected data will also satisfy GAO requirements for cost containment and spending accountability.

An item must be uniquely identified if: (1) The acquisition cost is $5000 or more, (2) It is either serially managed, mission essential or a controlled inventory piece of equipment, or a repairable item, or a consumable item or material where permanent identification is required, (3) It is a component of a delivered item, and the program manager has determined that unique identification is required, or (4) A UID or a DoD-recognized UID equivalent is available.

The label or mark that must be generated and applied to property must also meet all Mil Standard 130L-formatting specifics with regard to x-dimension, quiet zones, density, etc. The bar code label must also meet ISO Standard 15434 for syntax and formatting, with all appropriate message formatting within the message envelope including message formats, segments, data elements or fields, and sub elements. These marked items must also be registered with the UID Registry and remain there for their service life.

What UID Brings to the Table
UID requirements for marking and traceability go beyond what has been done before with regard to linking assets and property to the budgets through which they were acquired and to the balance sheets that reflect their current value. Charles Mara, of Data Capture Institute, a bar code research company with active participation on the UID integrated product team, makes this analogy: “Up until now assets and property have been behind walls or in containers, forcing managers to make ‘guesses’ about available resources at critical times. UID makes those walls and containers transparent.” The result of this transparency is much better equipment deployment, with a clean audit trail as a bonus.

Studies have shown that as much as 20% of capital goods budgets is wasted on acquiring property that is already owned or on the mistimed purchase of property when a substitute is available. (Data Capture Institute 2004) With proper UID implementation, the ability to trace assets and property throughout the lifecycle will all but eliminate this waste. Managers can utilize the new UID visibility by asking for and receiving accountability from department heads. In other words, visibility and accountability are two sides of the same coin.

The ability to have property visibility and accountability throughout the government and across an enterprise will create ripple effects. In program deployment, for example, malfunctioning systems will be spotted early in a new system design life, and quality assurance teams will identify and correct the offending component immediately. Program managers will have the ability to examine similar system performance elsewhere by querying the UID registry. Of course property managers are the key analysts who are charged with maximizing the benefits of this UID era.

The Property Managers’ Challenges
It cannot be stated enough, compliance with UID requirements is mandatory in order to do business with the Department of Defense. As Wylie Burge, Corporate Property Manager at Anteon Corporation, puts it, “UID is survival!” He points out that without proper UID compliance a contractor loses the privilege of doing business with the government. Without compliance contractors face one of three undesirable pitfalls: 1) They may not be paid for current work. 2) They may lose current contracts. 3) They may be barred from bidding future work.

According to Burge, the biggest issue he faces is developing a UID game plan and compliance policy, because compliance requires integration of company systems and scalability of information. “UID is more than a property management problem; everyone involved in a contract has a stake,” Burge says. “UID is revolutionary, a paradigm shift built on bar code technology that will change the way we do business. But first we need to learn how to fly. It’s a little taking up a C130 for the first time, without a parachute.”

So how is Burge preparing for the ride?

Here are a few of his suggestions:

  • Read the UID policy and understand what is required.
  • Keep updated on policy changes as they are announced.
  • Understand that compliance impacts the whole company and plan accordingly.
  • Develop a UID team consisting of all the functions that are impacted.
  • Consult with companies such as A2B Tracking Solutions who are bar code experts and pioneers in developing UID integrated software.
  • Don’t be too eager to implement huge internal systems until policy rollout is complete. Stay flexible.
  • Go to NPMA local chapters meetings for discussion and support.

“As property managers we need to realize that UID is here to stay. It won’t go away, and it will affect how we manage our assets and report to the government,” says Burge. “There is no silver bullet.”

UID – The Property Manager’s Opportunity
If you are the typical property manager facing UID compliance, you may be asking yourself, “Why me, and why now?” Yet there is every reason to anticipate that the UID mandate will raise the stature and responsibility of property managers everywhere.

“Why now?” Capacity is the answer. Although bar code has been around for forty years, only recently have databases been available with enough storage and query capacity to handle the government’s volume. With this increased capacity the efficiencies provided by bar code technology have been able to further evolve. Taxpayer and congressional frustration with budgetary waste have further spurred the accountability movement, exemplified by the UID Policy and the Sarbanes-Oxley Act.

UID is the third wave of what might be termed the bar code revolution, which began in the early seventies. The first wave was in the supermarket industry, with price look-up the main benefit. The second wave began at Wal-Mart, with the addition of EDI and the ability to monitor sales and replenish goods. Note that suppliers drove the first two waves of bar code use. A user, the DoD, has initiated the third wave. This third wave promises to be even bigger than the first two, because this wave increases the ability to use vast amounts of property effectively and efficiently. That will have immense ripple effects throughout the economy.

The good news for property managers who may be asking “why me?’’ is that they are on the leading edge of this newest bar code wave. What may seem overwhelming can be viewed as an extraordinary opportunity. Property managers who adopt UID, even before it becomes mandatory, in the initiation of all procurement functions, and those who put data structure capacity into place to handle the flow and storage of detailed data, will become leaders in their profession.

As Wylie Burge has pointed out, it is essential to examine the levels of management that need to mesh with UID policy. Savvy property managers will also anticipate and plan for the ripple of UID compliance throughout every level of their organizations.

Integration Is Key to Full UID Compliance
The challenge to meeting UID compliance requirements is daunting. Peter Collins, president of A2B Tracking Solutions, sees compliance in three stages. If each stage is thoroughly researched and implemented, Collins says, compliance will be the result.

Stage 1. Preparation

  • Decide what government furnished property (GFP) or legacy items will require a UID mark according to UID policy guidelines.
  • Decide upon the UID label or mark to be used, ensuring that durability standards are met and that Mil Standard 130 and ISO syntax requirements are met.
  • Choose the construct for the UID based upon the data required to be included in the label. It’s common for GFP or legacy property to be marked with Construct #1.
  • Decide how to create and generate the labels and marks that meet the marking standards mentioned above.
  • Apply the labels.

Stage 2. Validate Readability

  • Scan the labels to create an audit trail for the DCMA. The database created with this scan will validate an approved data structure for the machine-readable bar code.
  • The system should also tell the user where items are located, whether they are properly registered to the UID registry, and whether they have UID compliant labels.

Stage 3. Electronic Transfer of Database to UID Registry

  • Understand the required fields of information that are necessary to meet UID compliance when submitting the data to the UID registry.
  • Make sure your systems will transfer this information with the correct formatting and data elements to be accepted and approved by the DoD system.

Early efforts by DoD contractors to meet UID compliance have dealt mainly with preparation or labeling requirements. This is natural enough, since it is where the process must begin. Others have been considering enterprise-wide re-engineering to meet the challenge. This is risky, Burge warns, because changes are still being made to UID requirements and are likely to be made for some time. These changes might impact the scope of the requirement, the business rules for compliance, and the registration process. Keeping on top of these changes as they evolve is critical.

The rollout of UID compliance will happen over the next few months, with the groundswell of industrial change unfolding during the next few years. Smart property managers will be leading the charge.

About the author and the company: Joan Hacker is Director of Public Relations at A2B Tracking Solutions of Portsmouth, RI. As the leading provider of total solutions for bar code tracking, A2B has developed software that takes UID compliance all the way through the process, from preparation and labeling, to validation and electronic data transfer to the UID registry. Principals of A2B include founders of the bar code industry who have lead innovations in applications for 40 years. To date, A2B has completed more than 2,000 tracking installations around the world. For more information about A2B Tracking, visit www.a2btracking.com or phone (800) 733-7592.