RFID and Supply Chain Management: Introduction to the Special Issue

As markets become more global and competition intensifies, firms are beginning to realize that competition is not exclusively a firm versus firm domain but a supply chain against supply chain phenomenon. Visibility across operational activities-from demand forecasting, to the sourcing of raw materials, through to manufacture and dispatch-is critical to supply chain competition. Customers will no longer tolerate delays in response times and information is required in minutes not hours, to enable individual stakeholders to plan, organize and control their supply chain activities. Consequently, the most effective supply chain networks are dynamic in nature, distributed in architecture and leverage sophisticated real-time analytics. Information technology has a key role to play in supporting supply chain competition. The critical question for executives-and the focus of this special issue-is how to leverage emerging information technologies, such as radio frequency identification (RFID) to support supply chain operations? As an electronic identification technique, RFID offers a potential solution to the item/object transparency problems that have plagued supply chains in the past. For example, RFID technology can be used to: (1) reduce the time taken to reorder shipments, (2) reduce product shrinkage and theft, (3) improved tracking of pallets, cases and individual products, and (4) provide better planning and optimization of inventory and reusable assets. While bar codes offered significant advantages to organizations in terms of automatic data capture they were mainly instituted to identify goods for the purpose of gathering historical data. Bar codes are based on write once read many technology. In contrast, RFID passive tags (no internal battery) and active tags (self-powered battery) are updatable, enabling the transmission of data without a physical connection or line of sight. The non-line of sight capability of RFID makes it a perfect supply chain technology [12]. Passive tags operating under the ultra high frequency (UHF) band are common to supply chain applications because tag costs are low and the read range and rate is adequate [14]. In the case of supply chain management (SCM), RFID is not just about the identification of an individual pallet, case or item but about the relationships between objects, between organizations, between space and time. RFID is about process level change that can streamline business-to-business (B2B) operations and bring about major changes to organizational policies, culture, performance and structure [10]. Item relationships and the complex information flows required to manage objects in modern supply chains are increasingly being formalized through the efforts of EPCglobal (Electronic Product Code(TM)) standards [9]. The EPC provides a static ID which is stored in the RFID tag, providing a simple extension to the Universal Product Code (UPC), which bar code technology is based on. These standards allow organizations to move faster, provide richer information sources and increase the efficiency of trading networks. From a purely technical standpoint, RFID offers potential advantages not just across the supply chain but in an organization's warehouse where discrepancies are said to occur before the error is propagated to partnering suppliers and customers. RFID for location positioning of inventory on the warehouse floor, in addition to RFID coupled with the use of sensors to support exception handling pertaining to predetermined levels of temperature, pressure, humidity, distance or depth is likely to save organizations considerable money, not to mention partners' precious time as a result of the minimization of errors. However, much of the sensationalism synonymous with RFID has worn off. Larger retail players like WalMart and Target have re-evaluated their mandate for all of their suppliers to use RFID technology. Technical challenges such as erroneous reads, read collisions and the costs of handling large amounts of data generated by RFID have hampered progress. …