IT Enabled Changes in Supply Chain With RFIF Technology

8/12/2010 IT enabled changes in supply chain wit…
Scribd
Explore
Community
Upload a Document
Search Books, Presentations, Business, Academics...
Login
Prakash_2010
My Home
View Public Profile
My Documents
My Collections
Messages
Settings
Help
Log Out
scribd.com/…/IT-enabled-changes-in-s… 1/20
2 RFID Background
According to Forrester research the emerging trend which links the physical
supply chains to the digital world is cale l d (X Internet) or Extended Internet.
There are several technologies that fall in the domain of this trend. These tec h-
nologies are bar codes, smart cards, retinal scans, wre i less sensors, optical
character recognition and radio frequen cy identification (RFID). The technology
for RFID was intia i ry for Identification of Friend or Foe (IFF) sys-
i lly used in mlita
tems during W orld War II (Melanie, 2006). Later it was used for toll cole l ction
and library book tracking (Langley, 2008). Radio frequency identification has
been applied increasingly in inet r-organizational supply chain operations. How-
ever, it was not until the year, (2005) when Wal-Mart a US rea t iler started de-
veloping RFID mandates. Sn i ce then German-based Metro Group, Tesco and
Target (UK-based) have started focusing more on RFID in supply chain man-
agement (Langely, 2008). According to Forrestor research, in the beginning
RFID were introduced to retailing sector, ever since then it has been widely
used in industrial automation, asset management and track-and-trace applica-
tions.
Radio frequency identification is defined “A data collection and identification
technology that u ses electronic ta gs to sto re a nd tra nsmit identification data,
transmission data, a nd – in th e case fo r active tags- condition data (Chris-
tine, 2006).” RFID h as th e potential of bringing changes in inv entory m anage-
ment cost and efficiency in supply chain areas such as greater product availabil-
ity, reduced product shrinkage, and improved product integrity. Results from
RFID implementation have so far been positive with many firms. For instance,
recent research shows that RFID sae l s for supply chain purposes are predicted
to increase by almost 38% annually. (Carr, A, Zhang, M, Klopping, I, Mni .H, n.d)
and Wal-Mart proclaims a 16 percent decrease in out-of-stocks on RFID tagged
items (Langley, 2008).
3 How RFID Works

Radio frequency identification (RFID) uses tags for transmission of important in-
formation through radio waves in the supply chain (langely, 2008). These tags
can be attached or incorporated into a podr uct, good, animal or person (Be y-
non, 2009). RFID uses a serial number which identifies a person or object, and
other ree
l vant information on a mcroch
i t ched to an antenna. To-
ip which is ata
gether the small chpi and antenna constitute a RFID tag. There are two types of
tags active and passive tags. The former posses their own power source which
broadcast signals to the reader. On the other hand passive tags have no battery
therefore they reyl on readers power which induces current in antenna of tags.
Microchips in a RFID rarangement can be of three types (a) read -write; (b)
read-only and (c) “write once, read many” (WORM). In read -write mcroch
i ips in-
formation can be added to tags or write over existing information when the tag
i ity of interrogerator or reader. Read -only chps
in vcin i possess stored informa-
tion on them during manufacturing processes which cannot be changed and
“WORM” tags once a serial number is written over them, afterwards this infor-
mation cannot be overwritten.
(Source: Adopted from www.autoidcenter.org

with little modification)
So far we have been talking about information storage in RFID tags, so it is in-
teresting to know what kind of information RFID tags deliver wth i the products.
Most of the tags used by firms in supply chains possess an electronic product
code (EPC) which can be connected with online database wth i some gen eral in-
formation accessible to everyone. However, crucial information such as who
made it and when it was made can only be retrie ved if the manufacturer de-
sires. For instance, Willys, or Netto wll
i not be able to gain access data of prod-
ucts sodl by ICA or any other retailer. In the supply chain context companies
desire to use RFID to make sure that their products are availa ble on shelf as
soon as they are replenished. Nowadays, companies are thn i king of “smart
shelves” with RFID interrogators embedded in them, which would let the staff
knows when the inventory rea ches reo rder p oint and to a ct a s a th eft d eterrent
when some unusual shelf activity takes place.
4 RFID Versus Barcodes
As RFID becomes more popular in the automatic identification and data capture
industry many supply chain managers are wondering which technology to use
(Ray, 2008). RFID is not necessarily better than barcodes as choice of technol-
ogy depends largely on the context of use, the only dffei rence is that bar code is
a line-of-sight technology, meaning that a scanner has to be oriented towards
the bar code to read it. (am
i glogal.org). For instance, one dm
i ensional (1D) bar-
codes are best for supply chain applications when very limtei d number of data is
needed to be stored. However, codes may become unreadable if any wear and
tear occurs (Ibd
i ). Two dm i ensional (2D) barcodes can serve greater data sto-
rage needs. As far as RFID technology is concerned, it is best sute i d for appli-
cations where there is no direct line-of-sight, is vulnerable to wear and tear or
requires greater levels of process automation (Ray,2008).
5 Information Carried by the Product
As per definition of Chritine, (2006) radio frequency identification tags can store
and transmit (a) identification data; (b) transmission data and if active tages; (c)
condition data. This transmission of information along the product has enabled
several changes in the supply chains. According to Tajima (2007) in supply
chain m anagement product in formation that ca n be captured by the RFID sys-

tem includes instance data (for example d ates of manufacture a nd e xpiration),
historical data (for example departure and arrival times), product group data (for
example description, dm l g unit) and commercial entity data
i ension and selin
(e.g. address, teel phone number). For instance, paramount Farms, uses RFID
to manage its harvest in a most effective and efficient man ner.
Let us explain wth i help of an example how information carried by the product
with the help of RFID can change as the product flows from upstream to dow n-
stream in the supply chain. First in the field information about the amount of
harvest details of olives are identified by using RFID tags. In the second step at
the factory, production related condition data are added to pod r uct. In the third
step during the process of shipping, transmission data are added to the tags. In
fourth step, dstrib
i ution associated loading and receiving information is entered.
In the fifth stage data at the retail or shelf level is added. Afterwards the con-
sumer purchases the product, still the tags can be identified and traced. It is at
this stage that consumer privacy laws come into pa l y and companies must ad-
here to these standards code of conducts, finally, when the product is con-
sumed and dsp i osed even then the packaging carries recycling information date
and so on. For instance, Benettons and Gillette customers dd i not like RFID in-
itiative to the extent that some consumer activist appealed to general public for
boycotting these brand with interesting slogans like, “I would rather grow a
beard”. These consumers were aware of the fact that their purchases would b e-
come traceable and the information might be used by spammers. As a result
many businesses are adapting this technology mainly at warhouses.These
changes in the supply chains and unlimited access to ino f rmation is enabled by
using RFID tags and thus changing the way business is to be conducted in fu-ture.
(Source: Adopted from Christen Spivey Overby, 2006)
6 Actual Inter-and Intra-Organizational Information Flow
When the information is captured with the help of human interaction increases
transactions costs and may result in excessive or less levels of inventory
(Fleisch & Tellkamp, 2995). This is even more ree l vant to the retail sector which
is confronting challenges such as shorter- life cycles, stringent traceability re-
quirements and temperature control (Karkkainen, 2003). Due to these RFID and
its associated EPC network have the potential to serve as enablers in the ever
changing supply chain landscape by enhancing visibility and lowering inventory
carrying costs. Proper flow of information can result in more cola l boration and
cooperate among supply chain partners and decrease the so impact of bul lwhip
effect. T he b ullwhip e ffect m eans v ariation in d emand related information in a
supply chain setting which increases at each step as it moves from downstream
to upstream (Langely, 2008). According to Seidmann and Sundarajan, (1997) in
the domain of supply chain there are four types of information sharing practices
(a) Order information such as quantity and prices
(b) Operation information such as inventory levels
(c) Strategic information such as point-of-sale (POS) information

(d) Strategic a nd co mpetition information such a s demand information of a
competitor’s products
The figure below as a special case represents inter and intra-organizational ac-
tivities concerning to information flow in a supply chain settings. By looking
8/12/2010 tivities concerning to informaIT tionenabled
flow in achanges inain
supply ch supply
settingchain
s. By wit…
looking
closely at the figure it becomes obvious all that information flow is needs human
element or intervention. For instance, at the suppliers place during ”shipping” a
worker is suppose fill a Blli of lading. Sm
i ilarly, at the central ”Firm X” distribu-
tion center during the process of ”receiving” and ”shipping” several human i n-
terventions are needed such as checking the number of quantities shipped to
customers. However, to err is human and there are often complaints from cus-
tomers regarding incomplete volume of quantities. Therefore for the focal firm
”X” removing these mistakes has become a m atter of great strategic im por-
tance.
(Source: adopted from www.jtaer.com)
7 How RFID affects Inter-organizational Relationships

According to L ambert e t al., (1 998), “SCM is the integration of business
processes among companies that collaborate in an effort to bring a product,
service or unit of information from the initial supplier to the final customer ”.
Supply Chain management gives several benefits to firms such as reducing
costs (Spekman et al., 1998) and a colal borative advantage instead of a com-
petitive advantage. (Chen & Paulraj, 2004)
According to Jo hnston and V itale, (1988) a nd in ter-organizational systems

(IOS), “An automated information system shared by two or more companies. An
IOS is built around information technology, that is, around computer and com-
munication technology, that facilitates the creation, storage, transformation and
transmission of information. An IOS differs with an internal distributed informa-
tion system by allowing information to be sent across organizational bounda-
ries”. Wal-Mart’s introduced the concept of RFID as an inter -organizational
project and nowadays RFID is being used in both closed –loop and open-loop
settings. In closed loop supply chains it is normally used for internal systems
and in open loop settings to improve supply chain productivity. For instance,
Wal-Mart and other retailers like Target, Tesco and Metro normally use the later
approach. This implies that the application RFID clearly qualifies the require-
approach. This implies that the application RFID clearly qualifies the require-
ments for an inter-organizational system.
Other IOSs, commonly used in retailing are ee l ctronic data interchange (EDI),
internet and intranet and Barcoding which through information technology
enabled (ITes) services enable new logsticsi strategies such as Just-in-time
(JIT) for manufacturers and Quck i response (QR) for many retailers (Levy et al.,
2004; Wlsoi n and Vo l sky, 1998). The influence of RFID travels outside the
boundaries of a specific supply chain as sharing of the information carried by
tags can affect other members up and downstream in the supply chain. This
signifies the potential of RFID as supply chain management technology. How-
ever, it must be kept in mni d that mutual trust must co-exist for RFID to be car-
ried out successfully. Some of the key issues that affect inter-organizational re-
lationships are
 RFID benefits both downstream customers and upstream to suppliers

 Supply Chain members are more inclined to push tagging process up-
stream in the supply chain
 Inter-organizational relationships can be improved with the help of RFID
implementation. For instance, providing evidence to product shrinkage
issues.
 With the arrival of new RFID developments it would be hard for suppliers
to adapt the changes and may lead to conflict.
8 Disadvantages in Inter-organizational Relationships

Initially, RFID mgi ht seem to support the idea of moving from adversarial stance
towards a more cola l borative approach in real tionships. Ironically, though, it is
not aw l ays the case (LoPrinzi, 2006). This is nowhere more evident than in the
retailing sector (Fogarty, 2004) where RFID implementation creates problems
with suppliers by retailers tryn i g to influence suppliers from a position of
strength (Wllia
i ms & Moore, 2007). Wth i RFID more information is accessible to
the members of supply chains as a result more opportunities for cola l boration in
comparison with those partners who do not use ths i technology and they may
start feeling a sense of deprivation. An interesting case in point which RFID
i rb the balance of power and interde-
creates is that it has the potential to dstu
IT enabled changes in supply chain with RFIF

technology
Reads:
145
Uploaded:
03/08/2010
Category:
School Work > Essays & Theses
Rated:
Download this Document for FreePrintMobileCollectionsReport Document

This is a private document.
M.Tariq Yousafzai
Sign Up for Scribd Premium

Remove all ads.
Never see ads on Scribd again.
Customize your reading experience.
See only the parts of page you want.
Low monthly price
No Thanks
Like Be the first of your friends to like this.
Ads by Google
Productivity At Work
Step-by-Step Guide On Productivity
Learn How To Grow Your Business
productivity.enterpriseone.gov.sg
Microsoft ERP Software

From Tectura: Dynamics NAV, AX
Microsoft's Global Dynamics Partner
www.sg.tectura.com
Jobs Supply Chain

Looking For Ops/Logistics Jobs?
Find Your Ideal Job Through Us Now!
Jobs.ST701.com/Operations
Share & Embed
Link / URL: http://www.scribd.com/doc/28008228/IT-enabled-changes-in-supply-chain-with-RFIF-technology

Embed Size & Settings:
Width: (auto) Auto g

b
c
d
e
f
Height: 300
Start on page: 1
Preview View: Scroll 6
<a title="View IT enabled changes in supply chain with RFIF technology on Scribd" href="http://www.scribd.com/doc/28008228/IT-enabled-changes-in-supply
Related
1. 112 p.
Youtube Watch v=1qQ4iFI5Np8 129369...
Reads: 915
112 p.
Rife Frequency Machine Fort Collin...
Reads: 972
112 p.
RFID the Right Frequency for Gover...
Reads: 1111
2. 10 p.
Rfid Bplan
Reads: 575
2 p.
Radio Frequency Identification
Reads: 0
217 p.
RFID Strategic Implementation
Reads: 0
3. 22 p.
Group 7b Rfid
Reads: 274
8 p.
C DEFGH ‫وري‬LMN OPQ ...
Reads: 411
12 p.
Introduction to RFID- Types, Histo...
Reads: 0
4. 2 p.
Radio Frequency Identification
Reads: 70
51 p.
what_the_hack_rfid
Reads: 304
32 p.
Rfid Introduction
Reads: 402
5. 5 p.
Freight transport management~artic...
Reads: 477
11 p.
February 6, 2009
Reads: 484
More from this user

1. 3 p.
Arcticw on Micro Firms
From: M.Tariq Yousafzai
Reads: 30
28 p.
Chapter1 Paul Benyon Davis Chap...
Reads: 92
23 p.
Chapter 3 BIS
Reads: 47
2. 33 p.
Beynon-Davies Chapter 4 NEW
Reads: 58
25 p.
Reads: 41
27 p.
Reads: 43
3. 27 p.
Chapter 1 business information ...
Reads: 120
13 p.
Presentation on RFID enabled ch...
Reads: 128
14 p.
IT enabled changes in supply ch...
Reads: 166
4. 14 p.
IT enabled changes in supply ch...
Reads: 145
30 p.
Offshoresoft (B.Plan on Establi...
Reads: 454
7 p.
Prsentation on Pakistan Culture...
Reads: 405
5. 1 p.
HECroad Map
Reads: 45
2 p.
HEC Most Important Document for...
Reads: 73
16 p.
Beynon-Davies Chapter 9
Reads: 97
6. 19 p.
Business Information Systems Be...
Reads: 253
18 p.
Reads: 72
18 p.
Reads: 88
7. 36 p.
Marketing Report for Window Com...
Reads: 180
30 p.
Chapter 7 Paul Beynon Davies Bu...
Reads: 568
28 p.
Chapter 1 Paul Benyon Davis Lat...
Reads: 78
8. 35 p.
Marketing Presentation (ppt) fo...
Reads: 193
Add a Comment
Submit
riyazkhan7 readcast this 3 days agoLearn more about Readcast.

riyazkhan7 readcast this 3 days agoLearn more about Readcast.
Phallas readcast this 06 / 27 / 2010Learn more about Readcast.
tadissa readcast this 05 / 24 / 2010Learn more about Readcast.
Upload a Document
Search Books, Presentations, Business, Academics...
Scribd
About
Press
Jobs
Contact
Blog
Scribd Store
Legal
Terms - General
Terms - API
Terms - Privacy
Copyright
Help & Tools
Getting Started
Community Guidelines
Support & FAQ
Web Stuff
Partners
Partners
Branded Reader
Developers / API
Subscribe to Us
On Scribd
On Twitter
On Facebook
What's New
We have updated our Terms of Service

Branded Reader
Desktop Uploader

IT Enabled Changes in Supply Chain With RFIF Technology

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

IT Enabled Changes in Supply Chain With RFIF Technology

Uploaded by

Copyright:

Available Formats

8/12/2010 IT enabled changes in supply chain wit…

3 How RFID Works

(Source: Adopted from www.autoidcenter.org

chain m anagement product in formation that ca n be captured by the RFID sys-

(Source: Adopted from Christen Spivey Overby, 2006)

6 Actual Inter-and Intra-Organizational Information Flow

(c) Strategic information such as point-of-sale (POS) information

(Source: adopted from www.jtaer.com)

7 How RFID affects Inter-organizational Relationships

According to Jo hnston and V itale, (1988) a nd in ter-organizational systems

 RFID benefits both downstream customers and upstream to suppliers

8 Disadvantages in Inter-organizational Relationships

IT enabled changes in supply chain with RFIF

Download this Document for FreePrintMobileCollectionsReport Document

Sign Up for Scribd Premium

Microsoft ERP Software

Jobs Supply Chain

Share & Embed

Link / URL: http://www.scribd.com/doc/28008228/IT-enabled-changes-in-supply-chain-with-RFIF-technology

Width: (auto) Auto g

Youtube Watch v=1qQ4iFI5Np8 129369...

Rife Frequency Machine Fort Collin...

RFID the Right Frequency for Gover...

Radio Frequency Identification

RFID Strategic Implementation

C DEFGH ‫وري‬LMN OPQ ...

Introduction to RFID- Types, Histo...

Radio Frequency Identification

Freight transport management~artic...

More from this user

Arcticw on Micro Firms

From: M.Tariq Yousafzai

Chapter1 Paul Benyon Davis Chap...

From: M.Tariq Yousafzai

From: M.Tariq Yousafzai

Beynon-Davies Chapter 4 NEW

From: M.Tariq Yousafzai

Beynon-Davies Chapter 5 NEW

From: M.Tariq Yousafzai

Beynon-Davies Chapter 6 NEW

From: M.Tariq Yousafzai

Chapter 1 business information ...

From: M.Tariq Yousafzai

Presentation on RFID enabled ch...

IT enabled changes in supply ch...

From: M.Tariq Yousafzai

IT enabled changes in supply ch...

From: M.Tariq Yousafzai

Offshoresoft (B.Plan on Establi...

From: M.Tariq Yousafzai

Prsentation on Pakistan Culture...

From: M.Tariq Yousafzai

From: M.Tariq Yousafzai

HEC Most Important Document for...

From: M.Tariq Yousafzai

From: M.Tariq Yousafzai

Business Information Systems Be...

From: M.Tariq Yousafzai

From: M.Tariq Yousafzai

From: M.Tariq Yousafzai

Marketing Report for Window Com...

From: M.Tariq Yousafzai

Chapter 7 Paul Beynon Davies Bu...