Exploiting RFID digital
information in enterprise
Department of Management Science and Technology,
ELTRUN Research Center, Athens University of Economics and Business,
Purpose – The purpose of this paper is to investigate how a distributed network architecture,
building on web-service orchestration, data-stream management systems and smart-tagging
technologies, can be employed to enable enterprise collaboration and decision making.
Design/methodology/approach – The methodology is based on a technology review in order to
propose a network design as well as a ﬁeld survey to identify and evaluate the relevance of radio
frequency identiﬁcation (RFID)-enabled collaboration and decision-support scenarios to industry
Findings – The paper demonstrates the relevance of the proposed architecture and corresponding
RFID-enabled collaboration to business executives of the grocery retail sector. The responses show
that some scenarios are more appealing to retailers than to suppliers and that certain processes should
be done in collaboration.
Research limitations/implications – Research limitations and future research directions involve
the evaluation of speciﬁc design alternatives, in the speciﬁc context as well as comparing the
distributed architecture approach with a centralized architecture or with EDI which has traditionally
been used to support enterprise collaboration.
Practical implications – The proposed architecture supports not only internal operations of network
leaders, such as big retailers, but also suppliers who look into opportunities to beneﬁt from the use of IT
in enterprise relationships by gaining either process speciﬁcity or domain knowledge speciﬁcity.
Originality/value – The paper introduces a novel architecture that moves beyond the centralized
web site paradigm to a distributed one. A European ﬁeld survey is employed for the evaluation of
several RFID-enabled collaboration scenarios, providing insights to both researchers and practitioners
(retailers and suppliers in the grocery retail sector).
Keywords Business enterprise, Retailing, Radio waves, Decision support systems,Information retrieval
Paper type Research paper
The emergence of new technologies, such as radio frequency identiﬁcation (RFID),
is expected to revolutionize many of the enterprise collaboration operations such as
supply chain management by reducing costs, improving service levels and offering
new possibilities for identifying unique product instances. On the other hand, the
advanced data capture capabilities of RFID technology coupled with unique product
identiﬁcation and real-time digital information coming from different data sources,
such as environmental sensors, deﬁne a new and rich information environment that
opens up new horizons for efﬁcient decision-making activities.
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Vol. 107 No. 8, 2007
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Currently, RFID implementations take place internally within a company
mainly with the objective to automate warehouse and store management processes
in the ﬁrst run. The priority and effort placed behind such implementations by the US
Department of Defence and global retailers such as Wal-Mart, METRO, TESCO, etc.
combined with the pressure they put on their suppliers indicate that this technology
has already become a market mandate.
However, on the suppliers’ side, RFID, as a tag that has to be placed on their
products, is often considered to be an unfortunate strategic necessity (Barua and Lee,
1997) they have to comply with in order to satisfy the plans of their big customers for
increased internal efﬁciency. For suppliers to beneﬁt from RFID, they need to share
RFID information with their partners and exploit this information in order to
streamline enterprise collaboration and gain new market knowledge (Subramani, 2004;
Lekakos et al., 2001).
Despite this widely shared notion among enterprises, the efforts aimed at enabling
the exchange of RFID information between business partners are still in their infancy,
with the electronic product code (EPC) Network and the ONS infrastructure as the most
notable movements towards this direction. A recent report consolidating the views of
industry leaders and many different companies on a global basis (GCI, 2005) identiﬁes
the need to establish clear information-sharing work practices and infrastructures
between trading partners to support the use of free, standards-based information
exchange and collaborative decision-support, enabled by RFID technology. In this
context, this paper discusses how a distributed network architecture building on the
possibilities provided by web-service orchestration, data-stream management systems
(DSMS) and smart-tagging technologies, can be employed to enable enterprise
collaboration in supply-chain processes and decision making.
Based on the outcome of a design research approach as well as on the results of a
ﬁeld survey, the paper discusses, on one hand, the network design and the selection of
the proposed technologies from a technical perspective and, on the other, the relevance
of RFID-enabled collaboration and decision-support scenarios to industry executives,
including the associated beneﬁts and barriers, from a broader research perspective.
In the following section, we look closely into the technology of RFID and the way it
is employed in supply chain management. Section 3 then describes the proposed
architecture and tries to explain why the selected technologies have been employed
in order to support RFID-enabled collaboration and decision support. Section 4
discusses the relevance of speciﬁc collaboration scenarios to industry executives as
well as the expected beneﬁts and barriers associated with each scenario. Section 5
concludes with an overall critique and suggestions for further research in this area.
2. Employment of RFID technology in enterprise operations
RFID technology is concerned with the identiﬁcation of objects through the
transmission of radio waves from and RFID tag (microchip) attached to an antenna to
an RF reader. The information (including object’s serial number for instance)
transmitted by the RF tag is reﬂected back into digital information that can be passed on
to an enterprise information system. The EPC is the standard adopted in this case. RFID
applications include access control systems, livestock management systems, automated
toll collection systems, theft-prevention systems, electronic payment systems, and
automated production systems (Agarwal, 2001; Smith and Konsynski, 2003).
In the retail sector, RFID can potentially empower a broad spectrum of
applications, ranging from upstream warehouse and distribution management down
to retail-outlet operations, including shelf management, promotions management
and innovative consumer services, as well as applications spanning the whole
supply chain, such as product traceability (Pramatari et al., 2005). However, most
RFID implementations currently take place internally within a company, mainly
with the objective to automate warehouse management processes or store operations
in the ﬁrst run. A recent industry report (GCI, 2005) identiﬁes certain application
areas (speciﬁcally, store operations, distribution operations, direct-store-delivery,
promotion/event execution, total inventory management and shrink management) as
the major opportunities for the deployment of RFID technology in the short and
In the various application areas, the contribution of RFID can be sought across the
.the automation of existing processes, leading to time/cost savings and more
.the enablement of new or transformed-business processes and innovative
consumer services, such as monitoring of product shelf availability or consumer
.the improvement achieved in different dimensions of information quality, such
as accuracy, timeliness, etc. (Ballou et al., 1998); and
.the formation of new types of information, leading to a more precise
representation of the physical environment, e.g. a product’s exact position in the
store, a speciﬁc product’s production, distribution and sales history, etc.
The last two axes in particular, ask for new decision support algorithms and tools for
the associated beneﬁts to be exploited, opening-up a whole new research area for
decision support systems (DSS). Furthermore, for the full beneﬁts to be ripped, the
information needs not be exploited locally but be shared with supply chain partners in
a complex network of relationships and decision making.
If RFID technology is only exploited internally by a network leader looking solely at
internal beneﬁts, e.g. a big retailer trying to improve store operations, then suppliers
confront RFID technology as another unfortunate strategic necessity (Barua and Lee,
1997). This is already an existing trend in the market expected to have a negative
impact on RFID market acceptance and adoption rates. Subramani (2004) argues that
suppliers beneﬁt from information technology (IT) use in supply chain relationships
when they use IT either in order to gain higher business-process speciﬁcity or in order
to gain higher domain-knowledge speciﬁcity. We could say the ﬁrst two axes above are
associated with business-process speciﬁcity while the latter two are associated with
domain-knowledge speciﬁcity. Under this perspective, the question that arises is how
to enable collaborative processes and decision making exploiting the aforementioned
RFID capabilities, so that not only network leaders-retailers but also suppliers can
beneﬁt from the employment of RFID both in improving process management and in
gaining domain knowledge.
3. A proposed architecture for RFID-enabled collaboration and decision
making in a networked business environment
In this section, we describe a proposed architecture that can support new RFID-enabled
decision-support and collaboration practices in a networked business environment.
As a ﬁeld case, we consider the grocery retail sector which is characterized by an
intense supply-chain environment on one hand, handling thousands of products and
supply-chain relationships on a daily basis, and increased competition and consumer
demands on the other.
In this context, the key requirements that should be considered from a decision-support
.the immense amount of data that need to be processed in real time; already today
that products are identiﬁed at product-type level through barcodes, the handling
of information in real-time for decision-support purposes is quite a technical
.the need to ensure synchronized product information between supply chain
partners (Roland-Berger, 2003); although the sector has adopted barcoding
technology as a standard to identify products, yet the information is maintained
at different levels in either the retailers’ or the manufacturers’ systems causing
serious integrity issues when data exchange and synchronization is required;
.the many different business relationships that need to be supported; each retailer
may collaborate with hundreds of suppliers and vice versa;
.the different collaboration scenarios that may be applicable in each supply-chain
relationship; a retailer may collaborate with one supplier on efﬁcient warehouse
replenishment following CRP/VMI or on category management with another
supplier, etc. (Pramatari, 2007); and
.the need to support seamless information sharing and collaborative
decision-support through automated and secure interorganizational system links.
In order to cope with the above requirements, the proposed architecture employs:
.DSMS, supporting real-time analytics and decision support based on continuous
queries of transient data streams; and
.web-service orchestration, enabling secure and seamless information sharing
and collaboration in a distributed environment.
Until recently, DSS were based on data that were stored statically and persistently in a
database, typically in a data warehouse. Complex queries and analyses ware carried
out upon this data to produce useful results for managers (Chatziantoniou, 2003).
In many applications, however, it may not be possible to process queries within a
database management system (DBMS). These applications involve data items that
arrive online from multiple sources in a continuous, rapid and time-varying fashion.
This data may or may not be stored in a database.
For this reason, applications have recently been developed in which data is
modelled not as persistent relations but rather as transient data streams. A good
example of such an application would be one that constantly receives data about EPC
observations across a chain. In data streams, we usually have “continuous” queries
rather than “one-time”. The answer to a continuous query is produced over time,
reﬂecting the stream data seen so far. Computing real-time analytics (potentially
complex) on top of data streams is an essential component of modern organizations
(Chatziantoniou and Johnson, 2005).
Being able to efﬁciently perform complex real-time analysis on top of streams of
RFID measurements is the reason DSMS are employed by the proposed architecture.
This choice supports certain collaboration and decision-support scenarios, as will be
further described in the following section. In addition, a relational DBMS is used in order
to support less information-intensive scenarios and other elements of the application.
As far as the interorganizational system links and collaborative processes are
concerned, the technology of web services is employed in order to support them.
A web service, as deﬁned by the W3C Web Services Architecture Working Group, is:
... a software application identiﬁed by a URI, whose interfaces and bindings are capable of
being deﬁned, described, and discovered as XML artifacts. A web service supports direct
interactions with other software agents using XML-based messages exchanged via
internet-based protocols (W3C, 2002b).
In general, a web service is an application that provides a web API, supporting
application-to-application communication using XML and the web. Others reﬁne this
deﬁnition further by requiring the description be a Web Services Description Language
(WSDL) document and the protocol be SOAP (Ferris and Farrell, 2003). UDDI registries
are further used to identify and locate web services.
To move beyond the “publish, discover, interact” model, it is required to have the
ability to deﬁne logic over a set of service interactions. This not only enables the
composition of a set of services, but it also enables the deﬁnition of the interaction
protocol of a single service by specifying a sequence of its operations. The two
prevalent standards – the Web Service Choreography Interface and Description
Language (WSCI, WS-CDL) (W3C, 2002a) and Business Process Execution Language
for Web Services (BPEL4WS) (W3C, 2002a) – are designed to reduce the inherent
complexity of connecting web services together. The terms orchestration and
choreography have been employed to describe this collaboration:
.Orchestration refers to an executable business process that may interact with
both internal and external web services. Orchestration describes how web
services can interact at the message level, including the business logic and
execution order of the interactions. These interactions may span applications
and/or organizations, and result in a long-lived, transactional process. With
orchestration, the process is always controlled from the perspective of one of the
.Choreography is more collaborative in nature, where each party involved in the
process describes the part they play in the interaction. Web services
choreography aims at the coordination of long-running interactions between
distributed parties, which use web services to expose their externally accessible
operations (Muehlen et al., 2005).
The two notions, however, are not completely distinct. For instance, BPEL4WS can be
used both to describe orchestration and choreography issues (Viroli, 2004).
Furthermore, Muehlen et al. (2005) classify choreography standards proposals into
two categories: REST- and SOAP-oriented standards, which are not necessarily
competing, as REST represents a navigational style of design and SOAP represents a
procedural style. As we recognise that developments in this area have not yet
converged into a single prevailing standard, in the proposed architecture we choose to
use BPEL4WS and SOAP for implementing the notion of web services orchestration.
However, the other standards could also have been used for this purpose.
Figure 1 shows a schematic representation of the proposed architecture. As we see
on the ﬁgure, this is a distributed architecture, where the application layer runs on
the system of each collaborating partner and web services are used as the interface
between the different partners’ systems using SOAP requests and responses. The data
layer is implemented by both a relational database system (DBMS) and a DSMS
providing the application with a continuous stream of EPC information. The central
orchestration engine coordinates the exchange of messages between the web services
following the logic of speciﬁc process scenarios. Finally, the collaboration registry is
the implementation of a UDDI directory enhanced with additional higher-level
information regarding a collaborative relationship, including which partner
collaborates with each other under which process scenario and with what security
Since, this architecture is meant to support collaborative processes and decision
making in the grocery retailing/fast moving consumer goods sector, it is deemed
necessary to interlink it to the GDSN and ONS/EPC Network infrastructures or similar
infrastructures used for the same purpose. The Global Data Synchronization Network
(GDSN), established by the GS1 standardization organization and the Global
Commerce Initiative (GCI) aims at providing supply chain partners with accurate
product catalogue information and is implemented through a collection of data pools
and global registries. On the other hand, the EPC Network, supported by the Object
Name Service (ONS) infrastructure, has started materializing under the administration
of the proposed
Partner 1 Partner 2
and responses SOAP requests
Legacy systems Legacy systems
Web services Web services
and directives of EPCglobal and with the support of global standardization bodies and
leading industry forums (GS1, GCI). The difference between the GDSN and the EPC
Network is that the former is meant to support information sharing about product type
(what is currently identiﬁed via a barcode) whereas the latter is meant to support
information sharing about unique product instance (identiﬁed via an RFID tag,
following the EPC standard) (EPCglobal, 2004). The proposed architecture connects to
either these two or similar directory services in order to get the master product
information associated with a speciﬁc product type identiﬁed via a barcode (GDSN)
(e.g. product name, manufacturer, weight, dimensions, etc.), or additional information
associated with a speciﬁc product instance identiﬁed via an EPC (ONS/EPC Network)
(e.g. production date, distribution history, expiration date, etc.).
From a functional perspective, the proposed architecture can support different
collaborative processes and decision-support scenarios. Each of these scenarios can be
supported by separate components at the application layer, as for example the
following indicative interconnected modules:
.store management module (SM);
.promotion management module (PM);
.product traceability and reverse logistics module (TRL);
.inventory management and collaborative replenishment (ICR); and
.Consumer information services (CIS).
Each of the SM, PM, TRL, ICR and CIS modules performs different functionality on
each site; depending on what is the role of the collaborating partner, e.g. supplier,
distribution centre, retail store. The functional decomposition of the application and the
way it interacts with the rest of the elements in the architecture is schematically shown
in Figure 2.
As an example, Figure 3 shows an indicative scenario supporting dynamic pricing
enabled by the PM, where the supplier collaborates with the retailer in order to reduce
the price of some products approaching their expiration date.
Decision support application
PM TRL ICR CIS
Automatic data identification layer
Web service Process & workflow
SOAP requests &
4. Evaluating the business relevance of the proposed architecture and
While with the development of the internet, the centralized application architecture
initially dominated the ﬁeld of both web-based DSS (Jichang et al., 2004; Zhang and
Goddard, 2005) and collaborative supply chain management systems (Pramatari,
2007), we would argue that a decentralized-application-architecture presents bigger
advantages in the context presented in this paper. Schuff and Louis (2001) have
analyzed the beneﬁts of centralisation vs decentralisation of application software.
Based on their analysis, we can conclude that in the speciﬁc context, the
centralised software architecture is expected to lead to serious scalability issues and
delays in system response, especially due to the exponential information
increase associated with the employment of RFID for unique product identiﬁcation
and the need for real-time analytics and decision-support. Furthermore, a
distributed-application-architecture allows for better integration of the application
with internal business processes, as compared to the use of an external web site
(Pramatari, 2007). Web services further provide the means to enable this integration in
a standard way (Sayah and Zhang, 2005).
In that respect, the proposed system can be categorized as a distributed web-based
DSS as described by Zhang and Goddard (2005), where the data and decision-support
tools from multidisciplinary areas can be located on computers distributed over a
network. In such a distributed environment, a web-based DSS needs a distributed
framework to manage and integrate the data and tools in a seamless way. In the case
described in this paper, this framework is provided by web services, the web service
orchestration engine and the collaboration registry.
The proposed architecture is a generic distributed architecture that can potentially
enable various supply chain collaboration and decision support scenarios, whether
these are enabled by RFID technology or not. What is important to understand though
is which of these scenarios make sense to implement from a business perspective.
enabled by the proposed
From: Supplier and
Instruction: Reduce price
10.0 1/3/06 10.0 1/4/06
10.0 1/3/06 5.0 1/3/06
Companies in the sector already have a more-than-ten-years collaboration history
and some collaboration processes have become standard business practice across
Europe, such as CRP/VMI employed in retail warehouse replenishment or category
management dealing with the marketing aspects of managing product categories in the
store (Pramatari, 2007).
In order to understand the business relevance of alternative scenarios that
can be supported by the proposed architecture, we conducted a ﬁeld survey based on
questionnaires addressed to top executives representing retailers and
suppliers/manufacturers in the European food industry. According to Hevner et al.
(2004), examining the relevance of a solution is a fundamental step in the design
approach of information systems research, and this has been the key motivation
behind this ﬁeld survey. The objective of the survey was two-fold:
(1) to understand the relevance of some new RFID-enabled processes to business
executives and the degree these ﬁt with their current strategies; and
(2) to examine the degree to which collaboration is a prerequisite in these processes.
Furthermore, the survey provided useful input regarding the RFID readiness of
companies and the degree they are already involved in supply chain collaboration
The survey focused on the following eight alternative RFID-enabled collaboration
(1) Back-room and shelf visibility. The store personnel receive real time, information
about the backroom inventory level of each product. If a product is not on the
shelf (out-of-shelf – OOS), but there is available stock in the backroom, the
store personnel is informed to reﬁll the shelf; otherwise, if there is no stock in
the store at all (OOS), a new replenishment order is placed. The salesman of
direct-store-delivery suppliers has also direct access to this information through
(2) OOS response. Retailer and supplier get statistical information about shelf
availability, i.e. the level of stock on the store shelves, in order monitor the level
of OOS, which is considered one of the major problems the retail sector faces
today (Roland-Berger, 2003). While the previous scenario requires real-time
information ﬂows to support daily operations, this scenario is more about
business intelligence and decision support.
(3) Remote shelf management. Retailer and supplier get real-time information for
the actual shelf layout. RFID readers “scan” and “read” the shelf and provide its
“digital image” including information about the size, speciﬁc products’ position
and layout, as well as information about the shelf’s performance.
(4) Smart pricing. Retailer and supplier have the possibility to identify products
that are close to their expiration date or are standing still on the shelf for a long
time and dynamically reduce their price, in order to boost consumer demand
and reduce waste.
(5) Smart recall. Retailer and supplier have the possibility to identify the location of
products with speciﬁc characteristics and recall them from the market, e.g. in
case there is a risk with consumer safety, fast and at the minimum cost.
(6) In-store promotion management and promotion evaluation. Customers get
direct information about special offers and promotions relevant to the product
they just got off the shelf. Retailer and supplier can manage better their
promotion plans and evaluate in real-time the efﬁciency of their in-store
(7) Demand management. Retailer and supplier have the possibility to monitor the
inventory and the sales of products and relocate them if needed (e.g. in case of a
special promotion event) in order to eliminate lost-sales opportunities.
(8) Traceability information. The consumer at the end-point-of-sales has a clear
view of the product’s history and origin. At special information desks, the
consumer can get details about production date and origin, expiration dates and
other unique product’s information that can ensure product authenticity
These are new scenarios that capitalize on RFID’s capabilities for automatic data
capture and identiﬁcation of unique product instances in combination with other
information that can be derived in association with RFID, such as the shelf location, the
context of an in-store promotion event, etc. Some of the scenarios focus on the
management of speciﬁc operations and processes (e.g. 1, 4, 5), others focus more on
supporting decision making and building domain-knowledge (e.g. 2, 3), and others
combine both aspects (e.g. 6, 7, 8).
An exploratory ﬁeld survey was conducted (SMART, 2007) in order to provide
insights with respect to the scenarios described above (Figure 4). About 77 executives
from 25 companies throughout Europe (mainly from Germany, Greece, Cyprus,
Ireland, and the UK), representing retailers (54 per cent) and suppliers (34 per cent)
from the grocery retail sector, participated in the survey. The ﬁndings demonstrate
that retailers and suppliers agree that “back-room and shelf visibility” as well as
“demand management” are important possibilities that can contribute to their
company’s strategies. However, suppliers seem to value more than retailers the
possibility for promotion evaluation and promotion management while retailers are
more interested in being able to locate and recall products from the stores.
Field survey results:
relevance of alternative
To what extent do you believe that the following possibilities
contribute to your company’s strategy?
Remote shelf management
In-store promotion management
Back-room and shelf visibility
When retailers and suppliers were asked to indicate the top three areas in which they
need to work collaboratively with their supply-chain partners, most of them mentioned
supply-chain cost reduction (which was placed among the top three areas by more than
50 per cent of respondents), product safety and traceability and increasing shelf
availability (Figure 5). These answers reveal that the companies in the retail sector
have already adopted a collaboration mentality and are willing to use infrastructures
supporting collaborative processes and decision-support, as the one proposed in this
The executives that have responded to the survey declare that they work
collaboratively with supply chain partners in CRP/VMI and category management
programs to an adequate degree (4.8 out of 7) and that they have heard about RFID
technology and follow the developments in the area, but have not yet been involved in
an RFID pilot.
Following developments in the RFID ﬁeld, this paper proposes a distributed network
architecture that can support new RFID-enabled collaboration and decision-support
scenarios. The proposed architecture is based on the technology and notion of web
service orchestration in order to enable interorganizational process links and seamless
The proposed architecture can be categorized both as a web-based DSS that moves
beyond the centralized web site paradigm to a distributed one, and as an enterprise
collaboration system. As such, it aims at supporting both internal operations of
network leaders, such as big retailers, but also suppliers who look into opportunities to
beneﬁt from the use of IT in enterprise relationships either by gaining process
speciﬁcity or domain knowledge speciﬁcity (Subramani, 2004).
Based on the results of a European ﬁeld survey, the paper discusses the relevance
of the proposed architecture and corresponding RFID-enabled collaboration and
decision support scenarios to business executives of the grocery retail sector.
The responses show that some scenarios are more appealing to retailers than to
Field survey results: need
for collaboration with
Collaboration with supply-chain partners required:
0% 10% 20% 30% 40% 50% 60%
Building consumer value-satisfaction-loyalty
Increasing shelf availability (out-of-shelfproblem)
Enhancing collaboration with supply-chain partners
Product safety and traceability
Advertisement/ marketing activities
In-store events and promotions
Supply chain cost reduction
New technologies and innovations
Product enhancement/ differentiation
Improving store operations
suppliers and vice versa, while there is a well-grounded belief shared by both retailers
and suppliers that some processes should be done in collaboration.
Rather than evaluating the relevance of the proposed scenarios from a business
perspective, what is even more important is to evaluate the degree to which the
proposed architecture adequately supports the corresponding scenarios and fulﬁls
the requirements from various perspectives, which is a clear next direction of research
in this area. One such perspective is the consumer’s attitude towards the use of RFID
and the monitoring of purchase activities which may raise privacy or trust issues
(Angeles, 2007) and requires further investigation. Other directions for future
research relate to evaluating speciﬁc design alternatives, such as the use of different
Web Service Choreography standards rather than BPEL4WS, in the speciﬁc context as
well as comparing the distributed architecture approach to a centralized architecture
or to EDI which has traditionally been used to support enterprise collaboration
1. This study is partly funded by the SMART research project (ST-5-034957-STP), Information
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