Improving Supply Chain Visibility through RFID Data

Transcription

1 Improving Supply Chain Visibility through RFID Data Adam Melski #, Jürgen Müller *, Alexander Zeier *, Matthias Schumann # # University of Goettingen, Institute for Information Systems * Hasso Plattner Institute for Software Systems Engineering 1

2 Agenda * Motivation * Key Factors influencing Visibility * Effects of Visibility on Results * Appropriate Visibility Level 2

3 Motivation [1, 2, 3] * Positive Return-on-Investment (ROI) is a precondition for conducting RFID projects * Investments are easy to determine * Return is easy to dertermine if RFID only adresses > Slap-and-Ship or > Automation * How to determine the results of visibility-creating RFID implementations? 3

4 Key Factors influencing Visibility [4] * * * * * 4

5 Effects of Visibility on Results 5

6 Appropriate Visibility Level * Key factors are influencing Visibility Level * The higher the Visibility Level the higher the Costs * The higher the Visibility Level the higher the Results => appropriate degree of visibility Increasing visibility makes sense if the related results are higher than the related costs. 6

7 Examples SCM Task Visibility Awareness Decision Result Visibility Level Stock and Replenish Shelf Differentiate products in backroom and sales floor Shelf stock is visible Misplaced products Out-of-Stock situations can be recognized Misplaced products can be determined Effective Initiation of replenishment and ordering Replacement of misplaced products Fewer Out-of- Stock Situations Lower replenishment costs Increase in sales volume low visibility level average visibility level high visibility level 7

8 Bibliography [1] D. McFarlane and Y. Sheffi, The Impact of Automatic Identification on Supply Chain Operations, The International Journal of Logistics Management, vol. 14 (1), pp. 1-18, [2] T. Wailgum, Tag, You're Late. Why Wal-Mart's suppliers won't make the Jan. 1 deadline for RFID tagging, CIO Magazine, Nov. 15, [3] B. C. Hardgrave, D. J. Armstrong, and C. K. Riemenschneider, RFID Assimilation Hierarchy, in Proc. HICSS'07, 2007, paper , pp. 224b. [4] E. Fleisch, O. Christ, and M. Dierkes, Die betriebswirtschaftliche Vision des Internets der Dinge, in: E. Fleisch and F. Mattern, Eds., Internet der Dinge, Berlin, Germany: Springer-Verlag, pp. 3-37, 2005.

9 Thank you very much! Jürgen Müller 9

10 Examples (1/2) SCM Task Visibility Awareness Decision Result Visibility Level Demand Supply Planning Stock Levels and material flows in the SC are visible Stock level can be determined Production quantities and their statuses are known More exact adjustment of stock and initiation of orders Reduction of the bullwhip effect Improved Delivery Reliability Receive Product Visibility of shipments (right products, right quantities, right time, right documentation) Automatic determination of the purchase order fulfillment Reaction like refusal to accept goods or reordering of missing goods Transparen evaluation of supplier Less obsolence Inventory Exact material provision for production processes - low visibility level - average visibility level - high visibility level 10

11 Examples (2/2) SCM Task Visibility Awareness Decision Result Visibility Level Picking & Packaging Comparision of sales order and delivery Inspection for Perfect Sales Order In case of discrepancies, counteractive actions can be taken Optimized sales order fulfillment rate and improved customer rating Ship product Processing times Environmental data (temperature, pressure impacts, proximity to other objects) Idle/Processing times during shipment can be determined Quality deficiencies can be recognized in real time Counteractive measures can be taken (e.g. rerouting) Research into the cause of quality problems Increase in delivery reliability and quality Shorter delivery times Stock and Replenish Shelf 11 Differentiate products in backroom and sales floor Shelf stock is visible Misplaced products Out-of-Stock situations can be recognized Misplaced products can be determined Effective Initiation of replenishment and ordering Replacement of misplaced products Fewer Out-of- Stock Situations Lower replenishment costs Increase in sales volume - low visibility level - average visibility level - high visibility level