Improved supply chain integration: RFID

by Alfina Fauziah Pradhini Hadi NIM: 2301956014

There are just a few things that supply chain management is aimed at doing, and they all revolve around creating value for customers and profiting for the firm. To do this, the corporation must integrate its internal operations with those of its trade partners. Supply chain integration is the exchange of information and the coordination of resources in order to manage processes together (Wisner, Tan, and Leong). The usage of RFID technology in supply chain networks may accomplish all of this.
Many organizations are integrating their supply chains and offering an excellent example for a better understanding of what RFID technology can achieve for the supply chain network. First, organizations need to identify their most important trade partners, which are generally referred to as first-class suppliers. To get the best results, firms should start with just the most crucial partners, so that they may focus on the most critical process linkages. In the second step, assess and create the firm’s supply chain plan every year to guarantee that the company is pleased with the strategy internally. Third, supply chain strategies must be aligned with key process goals. To guarantee the most efficient use of resources and effort, companies must identify the most critical processes and create process goals. Fourth, the organization must design an internal performance metric to assess the core process after it has been defined and aligned. Identifying the processes and activities that will continue may be done. Data collection and reporting standards will be provided for important processes. The fifth step is to analyze and enhance the internal integration of key supply chain operations once performance data has been gathered.. There has to be coordination and cooperation between the many functional sectors inside and outside of the organization. Determine what changes are needed from the inside out and implement them.
In order to grow and integrate with external partners, firms must first be able to operate inside. Finally, the organization must collaborate with its suppliers to define external supply chain performance measurements for procedures that they consider to be crucial to their business. Collaboratively, partners came up with these standards for evaluating each other’s performance. It is important for partners to gather and evaluate performance data once performance measures have been implemented. For the seventh time, look at how external processes and supply chain performance are integrated. Observing a trade partner’s performance is an excellent way to tell whether they’re a good fit or if anything needs to be changed. This is a useful tool for businesses that want to know what works and what doesn’t in performance metrics. For this reason, it is possible that one of the partners has to be let go if the other follows his or her footsteps. Second- and third-tier vendors may be integrated after the primary process and key supplier partners have been established in a cooperative relationship. It will be some time before corporations fully connect with their suppliers since it would need to extend the exchange of information there. Integrating with other firms may be a fantastic thing, but only if the company is pleased internally and has a good relationship with its major partners.
As a supply chain integration tool, RFID technology relies heavily on cooperation and trust. Sharing information regarding demand and supply, from raw materials to completed items, is the primary function of the technology’s information-sharing system. A company’s relationship with its suppliers might either help or hinder the company’s adoption of RFID technology. Because firms have created the trust necessary to collaborate and exchange vital information, adoption is encouraged. They know how each of their partners operates the company and how they achieve their goals. In contrast, it may be more difficult to persuade your previously integrated suppliers to update their processes and invest in new technologies. Sometimes it’s tough to convince a supply partner that the current way of doing things isn’t working and that a change is necessary. When introducing a new system to your partners, be prepared with a detailed strategy. Unless a company’s suppliers have been integrated, getting them to adopt technology is almost hard. Because RFID requires a great deal of cooperation, supply networks for most businesses will already be fully linked. Companies will learn more about how to integrate radio frequency identification technology into their supply chains through the implementation phase, which is very similar to the way supplier partners integrate any procedure.

references

Rochel, Roman. RFID Technology and Impacts on Supply Chain Management Systems. Saarbruken, Germany: VDM Verlag Dr. Muller Aktiengesellschaft & Co., 2008.

Forrest, Wayne C and Lynn A Fish. “THE 7 Success Factors of RFID.” Supply Chain Management Review Sep 2006: 26