RFID in Supply Chain - Theory

A Supply Chain Enterprise System includes monitoring, planning and execution. The execution (work force, machinery, automation etc) was the first to attract heavy investments. During the last few years the enterprise resource planning attracted the interest of major software companies that delivered sophisticated products with high capital expenditures (e.g. SAP). Finally, regarding monitoring, the most common auto-identification technology operating today is Barcodes.

RFID comes to complement and eventually replace Barcode technology which was initiated 30 years ago and still remains unchanged. RFID is expected to lift monitoring to the same performance levels as planning and execution, and secure the synchronization of the whole Supply Chain Enterprise System.

RFID in Supply Chain - Practice

As an object (can be a pallet, a box or an item) moves from the supplier to the retail distribution center, and then on to the retail outlet, it passes through a number of RFID read fields. Readers capture and record the object's tag data as it passes through these points. The object's data hold substantial information, including its unique ID number, the date/time that it passed through a certain point etc. Multiple readers may communicate with each other through a server. The server application is responsible for gathering, storing and processing all the information that is obtained by the readers.

One can see how RFID technology can be of substantial business value by enabling the user to pinpoint the exact trail of a certain object throughout the supply chain. The table below, clearly illustrates the above, for an RFID-enabled good with EPC number (RFID tag number) 0022900.381826.500000055: