| Businesses whose operations rely on supply chains | | | | reliable data makes it possible to do demand |
| have to manage inventories of a large variety of | | | | forecasting and replenishment applications with |
| assorted items. Traditional systems of inventory | | | | greater accuracy. |
| management lead to many inefficiencies. Adapting | | | | Data Management Issues: |
| newer technology can largely eliminate these. To this | | | | Implementation of "silent commerce" and associated |
| end, many companies are exploring "silent | | | | analytic capabilities raises data management issues |
| commerce," or exploiting the benefits of radio | | | | that companies have to address. These are: |
| frequency identification (RFID) tags combined with | | | | Standards: The Auto-ID Center, an organization |
| wireless communication and sensors. | | | | comprising more than 90 manufacturers and |
| Advantages of Using RFID Tags: | | | | companies is doing work on Electronic Product |
| RFID is a technology that uses radio waves to | | | | Identification Code (EPC) that will replace the existing |
| automatically identify people or objects. An RFID tag | | | | Universal Product Code (UPC). This will enable |
| or transponder is a microchip attached to an antenna. | | | | companies to track products on real-time basis along |
| It stores a serial number that identifies a person or | | | | the entire supply chain globally. |
| object. The RFID is size of a grain of sand and sends | | | | Data Sharing: Organizations are presently in the initial |
| out an electronic signal when it is near a sensor. | | | | stage of using RFID tags in their supply chain |
| Production costs have been significantly lowered and | | | | systems. Most implementations exist in closed |
| RFID tags are now finding a host of applications in | | | | system environments. As the systems proliferate and |
| industry. Their use in lowering costs in the supply | | | | companies realize the advantages of cost savings |
| chain is of particular significance. Typical applications | | | | even in closed systems, they will increasingly be |
| include:o Items with RFID tags reaching a warehouse | | | | convinced about sharing data with trading partners. |
| will not have to be registered manually. The | | | | Privacy: Having a chip in various products creates |
| information lodged on the tag is read automatically | | | | unforeseen privacy issues that have to be addressed. |
| and entered into the inventory database.o Physical | | | | Theoretically, anyone with a scanner will be able to |
| counting and sorting is eliminated. Damaged items or | | | | locate any product. There are ways to overcome |
| those nearing expiry will be automatically identified.o | | | | this but it does highlight the serious nature of the |
| Packing instructions will be displayed automatically on | | | | problem. |
| a reader for the warehouse staff to act upon.o | | | | Modern technology offers myriad ways to bring |
| Costs can be cut down substantially as many clerical | | | | about operational efficiencies in a company's |
| functions and labor-intensive processes are | | | | processes and systems, using RFID tags can bring |
| eliminated.o Greater warehouse efficiencies are | | | | about substantial cost savings in an enterprise' |
| possible due to greater accuracy in order fill rates, | | | | logistics systems. Firms planning to use silent |
| faster inventory turnover and increased customer | | | | commerce can think of starting a pilot business-to |
| satisfaction.o It is easy to track lost or misplaced | | | | business project before implementing the technology |
| products, thus enhancing security.o Availability of | | | | on a global scale. |