clepa aftermarket security infrastructure by j rgen buchert sergej toedtli ceo teccom ceo vesdo n.
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Clepa Aftermarket Security Infrastructure by Jürgen Buchert Sergej Toedtli CEO – TecCom CEO - Vesdo. MEMA Brand Protection Council Meeting March, 12th 2008. Agenda. Introductions. Clepa – Aftermarket Security Infrastructure. Questions & Answers.

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    1. ClepaAftermarket Security InfrastructurebyJürgen Buchert Sergej Toedtli CEO – TecCom CEO - Vesdo

    2. MEMA Brand Protection Council Meeting March, 12th 2008 Agenda Introductions Clepa – Aftermarket Security Infrastructure Questions & Answers

    3. TecCom…was formed by the Industry

    4. 2001 2003 2004 2005 2006 2007 2002 Customers - a growingnetwork 90 75 Manufacturers 2001 2002 2003 2004 2005 2006 2007 10.2 7.5 6.3 Wholesalers (000)

    5. No. of wholesalers (incl PoS) by regions status 2007: 10.186

    6. Category Management synchronisemasterdata Inventory Management F/cast, planning and replenishment process wholesaler supplier Order Management manage order to pay process After Sales Management manage claims and returns TecCom Solution Portfolio Collaborative Managed Data (CMD) Collaborative ManagedInventory (CMI) Collaborative Managed Order – incl. electronic invoicing Collaborative Managed Warranty and Returns (Pilot 2008)

    7. 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 09.10.2014 Page 7

    8. Competencies of Vesdo Ltd. • Security: • Track- & Trace Concepts/ needs/ specifications • Security technologies for authentication • Technology: • Barcode - Standards/Printing/ Reading/ Verification • Supplier evaluation – Specifications/ RFI/ RFP • Testing – own lab • Business processes: • Modeling - Methods & Tools • Simulation - Partnership • Validation / qualification – FDA compliant • Inf. technology: • Database Concepts/ needs/ specifications • Communication for security and T&T landscapes 09.10.2014 Page 8

    9. Vesdo Ltd. services Engineering Consulting Implementing Testing The backbone of our business: • Independence of any suppliers • Confidentiality in all activities • 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 09.10.2014 Page 9

    10. 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 09.10.2014 Page 10

    11. MEMA Brand Protection Council Meeting March, 12th 2008 Agenda Introductions Clepa – Aftermarket Security Infrastructure Questions & Answers

    12. An Industry Approach to Authenticating Automotive Parts Experiences out of various projects in the European automotive industry

    13. The threat General view 09.10.2014 Page 13

    14. 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 09.10.2014 Page 14

    15. Criminal activities are growing on an exponential scale Gray marketdiversion Recycling usedpackages Illegal repackaging Changingexpirydate Smuggling Sales ofrejects Sales ofusedparts Guarantyfraud Brand owner Tampering Counterfeiting Upgrading in productfamily Theft 09.10.2014 Page 15

    16. Customs seizures statistics Seizures German Customs 1995 96 97 98 99 00 01 02 03 04 05 Growth rate 27% 09.10.2014 Year Page 16

    17. The threat Dealer's view 09.10.2014 Page 17

    18. 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

    19. Objectives

    20. Main objective of fight against counterfeiters 1st Priority 2nd Priority Ruin illegal business Send crook to jail Business action Legal action

    21. Supply chain Access to the supply chain has to be strictly controlled Access control • Code is the “ticket” for using the supply chain. • Security has to be integrated in logistical code. • Computer system can only handle authentic products.

    22. Enabling business partners • Providing a tool to the dealers & distributors to allow for: • authentication of products • simple • fast • reliable • cost effective

    23. Solution

    24. Required properties of an anti- product piracy system • Effectiveagainstspecific form offraud • Protectionagainstreproduction/ destruction • Technical deployability Numberofauthenticateditems in relationtothe total amountofitems Protection degree of security device x Control density = Benefit Cost Investments and runningcost 09.10.2014 Page 24

    25. Basic principle of logical security and barcode structure Every item gets its own identity Anonymous mass of items 246 248 686 438 Every item gets an individual code Today Future Code structure Data Matrix 13 digits (01) ……Free space… 9 - 20 digits (21) EAN 13 Serialization Page 25

    26. 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

    27. Benefits of combining logistics and security functions • 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. • 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. PROFIT Logistics Security Page 27

    28. 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 Expert) Technical analysis of defects ………… Page 28

    29. Security levels Basic security level Higher security level ? Direct marking of parts Coding folding boxes Additional security Features on folding box Page 29

    30. Comparison label/ hologram vs. barcode deployment Industry solution Company specific Combination is possible Page 30

    31. Pilot project label 09.10.2014 Page 31 Page 31

    32. Track- and Trace reality – Protect the supply chain Distributor Dealer Original manufacturer End user Trusted supply chain Trusted supply chain Mandatory scanning (Time/ location) ? Unknown source Distributor Dealer 09.10.2014 Page 32 Page 32

    33. 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

    34. 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

    35. Authentication process • single • online • mobile data base • local • central • pallet • local • online • batch 2D matrix code 35

    36. “www.tecidentify.com” 36

    37. “www.tecidentify.com” 37

    38. Screenshot TecIdentify 38

    39. First Movers target 2008: 25 39

    40. MEMA Brand Protection Council Meeting March, 12th 2008 Agenda Introductions Clepa – Aftermarket Security Infrastructure Questions & Answers 40

    41. 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

    42. Back up 42

    43. Architecture of global IT- network Public hub Public authentication PSTN Internet Authentication within supply chain Secure hub T&T T&T T&T Page 43

    44. The only function of the hubs is routing the queries Customer Public hub / Secure hub Manufacturer DB Company 1 Address registry Company prefix Query +Location Address: Company 1 Query Registering query & GLN Accepted Yes/No Accepted Yes/No DB Company 2 • No sensitve company (sales) data stored on hub ! • High security and high performance due to distributed architecture. Company n 09.10.2014 Page 44 Page 44

    45. Manufacturers cost for operating the CLEPA security system Product coding 1) Reduced price for software in larger quantities to be negotiated. Clearing hub Page 45

    46. Project time table 2007 2008 2006 First contact Draft of recommendation Approval IT-Concept CLEPA decision Clearing center realized Roll out “first movers” Page 46

    47. Participating “first movers” companies • Bosch • Continental Teves • Federal Mogul • GKN • Hella (2009) • Mahle • Mann + Hummel (Präs.10.10.2007) • Schaeffler, LuK, INA • Tenneco • TRW 11. TRW 12. ZF-Trading (Präs.11.10.2007) 13. Wabco (2008) Page 47

    48. Thank you VESDO: toedtli@vesdo.com +41 (44) 787 39 55 Page 48