Radio-frequency identification (RFID) is evolving into a key technological component for many supply chains and transportation. This system offers the transportation and logistics industry many benefits. The use of RFID technology in the transportation industry gives firms greater visibility of their assets and allows them to track only a few items or assets at a times such as; cars, shipping containers, and trailers. Some advantages include, automated yard management, optimization of container stowage, streamlined ground support equipment operations, smoother cargo operations, and easy vehicle tracking. Radio-frequency identification (RFID) has is evolving into a key technological component for many supply chains and transportation. This system uses tags, or label attached to packages to be identified from the supply chain and to the customer. This way system uses transponders that can act on their own to transmit as signal that can be picked up by readers called interrogators.
These interrogators read the signal from the tag which reports where the item is in the supply chain. One example of RFID technology is Common Access Card (CAC) used by military personnel and government employees to access their computer and certain areas within their workplaces. CAC cards are also known as Smart Cards. These cards have RFID tags embedded on them for storing personal information specific to each individual user. RFID can be used to a variety of functions, such as: tracking of goods, tracking or people, and access management. Another use for RFID technology is inventory systems. Wal-Mart is a perfect example of a firm that used this technology. Wal-Mart uses RFID reduce inventory discrepancies and to maintain inventory levels.
In the transportation and logistics are, RFID technology is used as tracking technology at shipping, freight, and distribution centers. An article posted by Arkansas Business website discussing how Wal-Mart has used technology to become a supply chain leader. Wal-Mart has made great strides to offer consumers the lowest prices possible by implementing technology that enables them to track inventory and replenish their at a cost savings. Wall-Marts’ Supply Chain managers play a key role in improving the flow of material and maintaining lower inventory. One of Wall-Marts improvements is the implementation of radio frequency identification tags (RFID), which improves that tracking of shipments throughout the supply chain improving inventory availability and replenishment.
It seems to like Wal-Mart is trying to go a little more Green by using hydrogen fuel cell powered forklifts and installing auxiliary power units on all their trucks to name a few (Berman, 2010). An article posted in April 2010 states that Wal-Mart is removing 20 million metric tons of GHG emissions from its global supply chain and that is the equivalent of removing more than 3 million cars off the road a year (Berman, 2010). That is amazing. If other larger companies could jump on the same band wagon as Wal-Mart this could be a start to reducing costs and improving the environment at the same time.
RFID technology improves yard management by automating processes and collecting data on multiple assets at a time. This technology allows firms to see where shipping bottlenecks are occurring within their processes so they can apply a quick fix. Delivery schedules can be improved upon by using this technology. Historical data can be accessed on each site to help improve service levels to meet future commitments.
When used for tracking assets and shipments, RFID can greatly reduce the number of lost or misplaced shipment. RFID tags provide instant alerts to the shipper and the customer to indicate the assets or shipment has moved from one location to the next. This technology can provide an audit trail and usage rates that can be accessed electronically, saving the firm time in the processing of documents.
RFID technology improves the inventory validity within a firm. Inventory counts tend to be more accurate and eliminates excess and missing inventory. This technology helps firms feel more confident that inventory counts are accurate and physically available. RFID technology can reduce the number of out-of stock conditions. Once the item leaves the shelf RFID technology will report that an issue was made and generate a reorder for the product to replenish the shelf.
Radio-frequency identification (RFID) technology has many benefits. This technology offers transportation and logistics companies numerous opportunities to improve processes , costs saving, and customer satisfaction. RFID is a growing technology that is being implemented by more and more firms every year.
Konings, Nijkamp, & Priemus, (2008). Future of Intermodal Freight Transport: Operations, Design and Policy. References: Arkansas Business. http://www.arkansasbusiness.com/article/85508/wal-mart-used-technology-to-become-supply-chain-leader?page=all. Accessed 18 July 2013.
Berman, Jeff. Posted on 01 April 2010. Wal-Mart Rolls Out Ambitious Sustainability Plan. http://www.logisticsmgmt.com/article/wal-mart_rolls_out_ambitious_sustainability_plan/. Accessed on 10 July 2012.