Supply chain management is a job that moves with the times. For as long as there have been supply chains, there have been people seeking to use technology in order to maximize the efficiency of their chain and ensure the uninterrupted flow of materials and goods.
RFID technology is a modern technology that can help to bring supply chains into the 21st century.
What Is RFID?
Radio Frequency Identification Technology is a technology that most people are familiar with now, even if they do not realize it. RFID devices are a potential alternative to the now outdated barcode. A barcode utilizes a series of black and white lines to encode information so that when it is scanned with a laser it can be understood by a reader. An RFID scanner does not need to be able to physically see an RFID tag in order to read it. Instead, they communicate by using radio waves.
For many warehouse managers, this alone is enough to pique their interest, but there are also implications for global supply chains that are equally enticing. RFID provides a potential solution to some of the most significant challenges that supply chain managers face today.
- Barcode scanners are labor-intensive.
- People are less reliable than automated systems, which RFID enables.
- Minor stock inaccuracies can cause problems down the line.
If you are at all interested in supply chain management, you should know about RFID and the potential changes that it could usher in. You might also be interested in supply chain management courses, in which you will learn how technologies like RFID are changing the landscape. Click here to check out Kettering University’s supply chain management course to see what’s involved.
Monitor Stock Levels Accurately
Accurate inventory tracking has always presented a challenge to businesses. While electronic systems enable us, in theory, to track inventory much more accurately, these systems are only effective if their human operators do everything correctly. There is always room for human error, and this can lead to minor inaccuracies. However, until a full stock audit is done, it will not always be apparent that anything is wrong.
Over time, these minor inaccuracies compound. The end result is that, when a proper audit is undertaken, the results cause alarm for businesses. Anything that can be done to further foolproof the process of tracking stock levels can ultimately save businesses time, money, and headaches.
When supply chains are flowing freely, the various businesses involved along the way can get away with minor inaccuracies in their records. However, the tighter the gap between supply and demand, the less tolerance there will be for inaccuracies.
By introducing an RFID setup for tracking parts as they pass through supply chains, workers don’t need to go hunting for barcodes. Instead, tagged items just need to pass a scanner. There are some setups where this can be automated entirely.
Track Items Through Supply Chains
- Ensure compliance with workers’ rights: Both consumers and businesses are increasingly taking a tough stance against suppliers who behave unethically towards their workers. Accurately tracking the flow of parts through supply chains can alert you to any suppliers who are reporting suspicious numbers.
- Make sure it’s legal: In some industries, businesses are legally required to purchase their materials through regulated supply chains. More accurate tracking means that businesses can easily check that their parts are coming from the right sources.
Accurate supply chain auditing is another ongoing challenge for manufacturing businesses, but we now have access to the ideal technologies to solve it.
- RFID: As mentioned above, RFID makes the actual act of scanning items and logging their process much easier and more reliable. This is part of the puzzle, but there is another challenge with supply chain tracking that RFID alone can’t solve – security. Someone who is determined to subvert the legitimate supply chain in order to reduce their manufacturing costs, or circumvent laws and regulations that they perceive to be making their jobs harder, can easily alter their records. Even if RFID is used to scan everything in, it is not a perfect system. That means that it has to be possible to make manual adjustments.
- Blockchain: However, it is possible to combine RFID technology with blockchain technology – which offers an immutable, cryptographically secure means of storing data. Of course, this means that even if the numerical count is known to be wrong, it cannot be adjusted. That information can still be recorded, but as long as the bulk of the items passing through the supply chain are being properly tracked, a secure record like blockchain will make auditing and validating supplies that much easier.
Using RFID provides businesses with another opportunity to introduce automation into their business and therefore potentially save themselves money on staffing costs. Under the old barcode system, a human operator was required to work a barcode scanner and ensure that it has physical line-of-sight with the barcode being scanned. This slows things down considerably.
By using RFID technology, it is easy to create an automated supply line where items can reliably be tracked and recorded without a human having to be involved.
Transitioning to Green
RFID can enable supply chains to slim down and minimize their environmental footprints. Remember, the environmental damage that a building causes is not limited to the direct emissions that it gives off. Some supply chains are very labor-intensive, requiring large numbers of people to travel to industrial facilities, causing emissions as they go, and then working on supply chains that aren’t always ecologically-friendly.
As well as the effect of these emissions on the environment, workers who work on dirty or outmoded supply chains are exposed to toxins and carcinogens. Most people are aware of the disaster that was Asbestos; a lot of the compounds that workers are being exposed to today are still new to science, and we don’t know their long-term impacts. Reducing general levels of exposure to these new compounds should be a priority for all of us. Automating certain parts of some supply chains could go a long way to achieving this.
RFID has the potential to revolutionize supply chains in a variety of ways. Accurate supply chain auditing is important to businesses and consumers, making RFID a solid investment all-round.