Is RFID the one stop solution to the problems of SCM?

Dear Shailena Varma, RFID technology can be used in many fields from  SCM to the State Security. It can be utilized to save the time and ease the operation. But it has an equal danger zone also. The radio waves can be used for theft, including threat to  security. I believe if you have a computer system for warehousing manifesting and dispatching with bar code labels unit, the SCM can be handled with out much risk involved.

RFID is a tool, that electronically carried the information of the product and aids to track the whereabouts of teh product during warehousing and transit.

Application of RFID is accompanied by many limitations.

One limitation is it's high cost. In thsi point of view, the value of the product under cinsideration must justify the high cost of RFID.

The reverse logistics of RFID (return of RFID chips upto the supplier after product successfully reaches destination) is a cumbersome process.

Another problem faced by RFID is that, after serving the purpose, the information does not become obsolete. These is always a possibility that, the information stored in RFID chip may be misused after it has served it's purpose.

In most of the cases, the limitations posed by RFID outweigh the benefits. Oherwise, RFID would have become most commonly used technique by now!!! 

RFID is just another technology, it is not even a solution in itself. You have to design a solution using RFID technology, in tandem with other Supply Chain best practices and technologies. As a student at University of Michigan Business School, I had an opportunity to implement RFID for a leading logistics services provider in Middle East during my internship and we failed in our first go live. That was a hands on expereince for me to establish the fact that the most important part is not the technology itself but how you plan to use the technology.

RFID is merely a radio tag tracking mechanism for shipments.  It therefore addresses only one aspect of the supply chain, goods in transit.  It does not address the other main aspect, which is inventory management and warehousing management, whether on the procurement end, or the distribution end.  Further, at the present level of technology, there are still bugs to be ironed out of the system. 

Not at all by any sense of imagination... RFID would make a few things simpler in SCM but an end to all your problems it's not. It possible makes asset monitoring & control easier but what else can it do ? We must understand that all these are simple means and tools for process improvement, solutions to our problems will not come from these technologies but would come out of how we use and utilize these technologies... We will never reach a stage where one single technology or process would solve all our problems but the solution to our problems would come from our collective usage of all available tools.

Navneet

Dayanand you are absolutely right. Apart from all the technology concerns there one more social concern which is a source of resistance to the adoption of RFID by many organizations and that is privacy. RFID tags can be scanned even after they exit the supply chain, and without anyone’s knowledge. Because RFID tags are non-specific in the scanner that they transmit data to  anyone with an RFID scanner. This problem is exacerbated by the fact that many RFID scanners are easily portable, and RFID tags can be read at a considerable distance, as well as quite difficult to remove.

I do agree to vijay and shailena that RFID is not one stop solution for Supply chain problems. RFID reader collision and RFID tag collision are problems which needs to be addressed before moving ahead with RFID. And privacy is a very social concern... RFID is a step towards interfering in the personal life of a customer. It might have a negatie impact for the companies using RFID..

I do agree that compatibilty is one problem which can be solved but even if we solve this issue other problems that can arise include RFID reader collision and RFID tag collision. RFID reader collision occurs when there is an overlap in the coverage area of multiple RFID readers. Because RFID tags are designed to only be able to transmit to one reader at a time, this can cause several problems. One is that the signals from overlapping readers can interfere and prevent the item from being scanned. Another is that the signal convergence can lead to the same tag being read more than once, leading to duplicate and inaccurate scanning results, which would cause supply chain execution problems.