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| Thought Paper |
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RFID in Supply Chains |
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| Abstract |
During the last decade, most organizations have implemented enterprise-wide
applications and integration platforms. These implementations have delivered benefits
in terms of data synchronization and information flows within the organization, and
with trading partners providing valuable inputs for planning and optimization of
schedules and reporting. However, automated data capture and tracking in real-time
has been a major bottleneck, affecting the ability of organizations to optimize their
investments in supply chain solutions.
RFID or Radio Frequency Identification is emerging as a technology that could
provide the answer to these problems. Using tags, readers and radio waves to
communicate between the two, RFID combined with the EPC (Electronic Product
Code) would be able to address these pain points and deliver a whole range of
benefits across various verticals like manufacturing, distribution, retail, logistics,
security. The potential benefits arise from increase in supply chain visibility, increase
in efficiencies and decrease in costs due to better data synchronization, increase in
responsiveness to changes due to real time information visibility and a number of
additional industry / vertical specific benefits. Thus, RFID promises to have a major
impact on supply chains allowing trading partners to collaborate more effectively and
achieve new levels of efficiency and responsiveness.
Realizing the potential of RFID to deliver major benefits in the supply chain, both end
users and technology vendors are moving quickly to harness its potential. End users
are conducting pilots to understand the technology, its impact on their processes and
the costs of adoption. At the same time, the technology vendors are working to reduce
costs and improve effectiveness for the technology. This has led most analysts to
predict that the RFID market will touch a few billion dollars by 2005-2007.
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