Connective technology as a strategic tool for building effective supply chain

Abstract

A strategic perspective on Radio Frequency Identification (RFID), an important connective technology for building effective supply chain for the consumer products is presented. Suppliers are cautiously responding to the retailers' demands in implementing this technology. The primary question for the industry is which immediate or near term RFID initiatives can produce positive return on investment. Industry survey in which participants rate the validity of various research suppositions derived from industrial experts provides basic understanding of the issues involved. An analytical model of RFID technology deployment using Wal-Mart RFID compliance example illustrates how lower shipment processing costs and lead times result in smaller cycle inventory and safety stocks.