Applications of RFID in Supply Chains

Topics: RFID, Supply chain management, Radio-frequency identification Pages: 22 (9883 words) Published: September 24, 2014
Applications of RFID in Supply Chains

Gary M. Gaukler
gaukler@tamu.edu
RFID and Supply Chain Systems Lab
Dept. of Industrial and Systems Engineering
Texas A&M University
College Station, Texas 77843-3131, USA

Ralf W. Seifert
seifert@imd.ch
IMD - International Institute for Management Development
Chemin de Bellerive 23, PO Box 915
CH-1001 Lausanne, Switzerland

Copyright
This paper is published as a book chapter in “Trends in Supply Chain Design and Management: Technologies and Methodologies”, edited by Hosang Jung, F. Frank Chen, and Bongju Jeong, published by Springer-Verlag London Ltd.

Abstract
In this chapter we first give an introduction to radio-frequency identification (RFID) technology. We discuss capabilities and limitations of this technology in a supply chain setting. We then present several current applications of this technology to supply chains to demonstrate best practices and important implementation considerations. Subsequently, we discuss several issues that may hinder a wide-spread RFID implementation in supply chains. We close by deriving several consequences for a successful implementation of RFID, and we give guidance on how a company might best benefit from this technology.

2

G.M. Gaukler and R.W. Seifert

1.1 An Overview of RFID Technology
At its core, RFID is a contactless interrogation method for identification of objects. Besides the applications in supply chain operations that this chapter is going to focus on, some of the everyday uses of this technology are in ID cards, sports equipment, windshield-mounted toll tags, and gasoline quick-purchase tokens. RFID has also begun to be used in keychain auto anti-theft devices and toys (most notably, Hasbro Star Wars figures), and even on paper tickets for the 2006 Soccer World Cup in Germany (Odland 2004; Want 2004).

1.1.1 RFID Hardware
An RFID system essentially consists of three parts: the RFID tag itself, the RFID reader device, and a backend IT system. The RFID tag typically consists of a silicon chip that can hold a certain amount of data (such as a unique identification number), and an antenna that is used to communicate with the remote reader device. There are chipless RFID tags as well, which exploit certain RF-reflecting properties of materials. In the case of chipless RFID, the tag’s unique serial number is given by the properties of the material, e.g. the configuration of RF fibers embedded in paper.

The reader device communicates with the RFID tag by means of sending and receiving radio-frequency waves. The way this communication happens differs between so-called passive and active RFID tags. Passive RFID tags do not have a power supply; the energy stored in the reader device's radio-frequency interrogation scan is enough to wake up the RFID tag and to enable it to send a response (that is, the RFID tag's data) to the reader device by means of reflection. Active tags contain a battery that allows them to respond to the reader's interrogation with a stronger signal, thus increasing the distance from which the tag can be read. The backend IT system is responsible for cross-referencing the RFID tag's ID number with a database record that describes the object to which the tag is attached.

The method of communication by reflection of power that is the basis of passive RFID has been described as early as 1948 (Stockman 1948). Related transponder technology has also been used by the military as a friend-or-foe means of detection in Great Britain by the Royal Airforce in World War II. Regardless of the choice of active vs. passive RFID, the radio-frequency communication between tag and reader may happen on several frequency bands. Low frequency (LF) RFID uses the 125–134 kHz and 140–148.5 kHz channels, high frequency (HF) RFID is located at 13.56 MHz, and ultra high frequency (UHF) RFID uses 868–928 MHz. These frequencies are the ones that are used in the United States of America; European and Asian frequency...

References: Aitoro J, (February 2005) The Government and RFID: What You Need to Know,
VARBusiness,
Alexander K, Birkhofer G, Gramling K, Kleinberger H, Leng S, Moogimane D, Woods M,
(2002) Focus on Retail: Applying Auto-ID to Improve Product Availability at the Retail
Angeles R, (2005) RFID Technologies: supply chain applications and implementation
issues, Information Systems Management 22(1).
Atali A, Lee H, Ozer O, (2005) If the inventory manager knew: Value of RFID under
imperfect inventory information, Working Paper, Stanford University, Stanford CA
Baker M, (October 2005) Hospitals Save Costs, Time with Wireless Tags, ExtremeNano,
http://www.extremenano.com/article/Hospitals+Save+Costs+Time+with+Wireless+Tag
Brandel M, (December 2004) The Trouble With Tags, Computer World,
http://www.computerworld.com/softwaretopics/erp/story/0,10801,98340,00.html.
(2006)
The
DeLong B, (2003) How the US Military is Achieving Total Asset Visibility and More Using
RFID and MEMS, Presentation, Smart Labels USA, Cambridge, MA.
Gaukler G, (2004) RFID in the Retail Supply Chain: Benefits, Roll-Out Strategies, and Cost
Sharing Agreements, The Supply Chain Connection 10(2), Stanford Global Supply
Gaukler G, Hausman W, (November 2005) RFID in Assembly Operations: Process and
Quality Savings, Working Paper, Dept
Gaukler G, Ozer O, Hausman W, (November 2005) RFID and Product Progress
Information: Improved Emergency Ordering Policies, Working Paper, Dept
Gaukler G, Seifert R, Hausman W, (2006) Item-level RFID in the Retail Supply Chain,
Production and Operations Management (POM), forthcoming.
Johnson D, (November 2002) RFID Tags Improve Tracking, Quality on Ford Line in
Mexico,
Velocity,
Jones P, Clarke-Hill C, Shears P, Comfort D, Hillier D, (2004) Radio frequency
Kambil A, Brooks J, (2002) Auto-ID Across the Value Chain: From Dramatic Potential to
Greater Efficiency and Profit, White Paper, www.autoidcenter.com.
Karkkainen M, (2003) Increasing efficiency in the supply chain for short shelf life goods
using RFID tagging, International Journal of Retail and Distribution Management,
Kelly E, Erickson G, (2005) RFID tags: commercial applications vs. privacy rights,
Marketing Intelligence and Planning, 23(4).
Keskilammi M, Sydanheimo L, Kivikoski M, (2003) Radio freuqncy technology for
automated manufacturing and logistics control – Part 1, International Journal of
Klabjan D, (2005) One-to-one marketing with RFID, Working Paper, University of Illinois,
Urbana Champaign.
Lee H, Ozer O, (March 2005) Unlocking the Value of RFID, Working Paper, Stanford
University, Stanford, CA 94305.
Lee H, Whang S, (October 2003) Higher Supply Chain Security with Lower Cost: Lessons
from Total Quality Management, Working Paper, Stanford University.
Metro AG, (February 2006) Press releases on www.futurestore.org.
MIT CTL, (November 2004) Reading RFID, http://ctl.mit.edu/index.pl?id=3612.
O’Connor M, (December 2005) Kroger Turning to RFID to Stay Fresh, RFIDJournal,
http://www.rfidjournal.com/article/articleview/2055/1/1/.
Odland T, (February 2004) RFID and Leisure RFID, Card Technology Today.
Pasternack B, (1985) Optimal pricing and returns policies for perishable commodities,
Marketing Science 4(2).
Pfizer, (February 2006) Press releases at www.pfizer.com.
Savi, (February 2006) Press releases at www.savi.com.
Sheffi Y, McFarlane D, (2003) The impact of Auto-ID on supply chain operations,
International Journal of Logistics Management 14(1).
Stockman H, (October 1948) Communication by Means of Reflected Power, Proceedings of
the IRE, 1196-1204.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Implementation of RFID in supply Chain Essay
  • Essay about Rfid in Retail Supply Chain
  • Rfid Innovation in Supply Chain Management Essay
  • supply chain Essay
  • Applications of RFID Essay
  • Essay on supply chain
  • Essay on supply chain management of Walmart
  • Supply chain Management Essay

Become a StudyMode Member

Sign Up - It's Free