FlexRFID middleware in the supply chain: strategic values and challenges

Abstract

Radio Frequency Identification (RFID) was used since the Second World War to identify “friend or foe” aircrafts. Recently, it is becoming an enabling wireless technology which is widely employed in a number of application areas such as ID badges and access control, equipment, personal, and patient tracking in hospitals, highway tolls collection, tracking livestock movements and air freight, parking lot access and control, container and pallet tracking, product tracking through manufacturing and assembly, inventory control, and in supply chain management (SCM). RFID tags were used for tracking pallets and cases by both Wal-Mart and the Department of Defense (DoD) of USA in 2003. By 2006, Wal-Mart has extended the requirements to use RFID to all its suppliers. The use of RFID in supply chain networks has allowed Wal-Mart to create value through greater visibility in its networks, higher product velocity, reduced human error and labor cost, and more efficient inventory management. This eventually led to the achievement of Quick Response (QR) and improved Customer Relationship Management (CRM) in the supply chain. However, some RFID system challenges (e.g. system design, tags and readers cost), and uncertain Return-OnInvestment (ROI) still need to be overcome to fully achieve these objectives. This paper introduces RFID technology and its key components and concepts, and presents our RFID middleware solution called FlexRFID which was developed with an aim of achieving the maximum benefits of RFID technology independently of the interested backend applications. We illustrate how RFID technology can be used to solve the main problems in SCM, the advantages and key issues when implementing RFID in SCM networks, and the relationship between RFID and the main SCM processes. Finally we give a suggestion of how FlexRFID middleware can be integrated with an SCM application for inventory control.