Coupling RFID with supply chain to enhance productivity

Abstract

Purpose

The purpose of this article to review key points about the radio frequency identification, and productivity enhancement in SCM through the use of radio frequency identification. To understand radio frequency key points fundamental on that are identified and reviewed. Some applications of radio frequency identification in supply chain are briefly reviewed and five cases of radio frequency identification implementation in supply chain are discussed.

Design/methodology/approach

Provides key elements of radio frequency identification and the integration of supply chain and radio frequency identification for generating new systems with higher level of profitability, efficiency, and productivity.

Findings

To make supply chain system functional and successfully operational manufacturers can use radio frequency identification solutions to reduce operating costs through decreasing the labor costs, claims, and returns. This will help them to increase the operating income. They also can reduce working capital by enabling reductions in inventory and lowering the inventory write‐off from the return goods and those items that are un‐saleable at the end. It is the collection of such strategies that can bring higher level of profitability and productivity to the supply chain.

Practical implications

This sophisticated technology is more useful to the management for one or more of the following facts: better supply chain and inventory management; reducing counterfeiting and fraud controlling; tracking work‐in progress; reducing administrative errors; reducing rework; better management of warrantee claims; capable of working in suitable and harsh environments; better supply chain efficiency; cost saving and profit enhancement.

Originality/value

Due to the fact that a better management of production system is related to the full understanding of the technologies implemented and the system under consideration, sufficient background on the radio frequency identification technology is provided and supply chain management system including profitability and productivity enhancement are discussed.

Citation

Zare Mehrjerdi, Y. (2010), "Coupling RFID with supply chain to enhance productivity", Business Strategy Series, Vol. 11 No. 2, pp. 107-123. https://doi.org/10.1108/17515631011026434