See better, manage better. Leveraging RFID to improve your supply chain processes.
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A BRIEF HISTORY
Companies are striving to reduce costs, improve service, and increase return on investment throughout their supply chain. Automated radio-frequency identification (RFID) solutions can play a role in meeting those challenges.
Radio-frequency identification (RFID) technology has been around for a while. Its VERY early predecessors were used in WWII with IFF transponders to distinguish enemy aircraft. More recent incarnations were used in the 1970s for early toll collection devices and animal and vehicle tracking. In the 1990s, common standards began to take shape and mature from a novel, niche technology to the mainstream industrial and consumer based product it is today. The most current generations of RFID have included advances in miniaturization, further reductions in price and added security.
RFID’s CONTRIBUTION TO SUPPLY CHAIN
Supply chains continue to mature as well and with them, the tools needed to properly manage and optimize those processes need to mature with them. Efficiently tracking your supply chain workflow and assets is part of that well oiled machine.
RFID increases equipment, inventory, and business process visibility. It also increases efficiency by optimizing business processes and automating asset and inventory management while streamlining data capture procedures. Imagine the time it takes to perform a physical inventory reduced from 2 days to 2 hours or knowing the exact moment a valuable asset has walked out the door instead of realizing 2 weeks later that it’s disappeared.
RFID IN PRACTICE
Automated systems continue to help companies improve their workflows and boost their bottom lines by optimizing asset and inventory management in internal, closed-loop systems in which RFID tracks assets, such as vehicles and equipment which stay inside the company. Here are come examples:
- By using RFID inventory management techniques like smart cabinets, hospitals can have full visibility into their inventory and know exactly how much to reorder and when thereby reducing the amount of stock on hand by 20-30%, which means buying less equipment that then in turn just sat on shelves because of miss-counts.
- Walmart has been using RFID technology for about a decade and cites numerous benefits, including more efficient inventory management. The company initially introduced RFID to track pallets of merchandise traveling along its supply chain, including at warehouses. In 2007, executives credited the technology with, among other things, cutting the volume of excess inventory in Walmart’s massive supply chain and slashing out-of-stock occurrences by almost one-third.
MOVING FORWARD
RFID is evolving in many intriguing directions. Companies are increasingly interested in using active RFID tags as sensors to ensure food safety by monitoring temperatures in different areas on refrigerated trailers. When an area gets too warm, the tag automatically notifies the driver and master control so they can remedy the situation. RFID sensors also help ensure traceability in the event of a recall.
RFID is not longer a bleeding edge technology taking shape in only the largest organizations. Instead it’s a viable solution any company can implement and integrate into its workflow to provide greater viability to its processes and assets and optimize output and accuracy.
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