No full-text available
To read the full-text of this research,
you can request a copy directly from the authors.
Simulating and evaluating the impact of RFID on warehousing operations: a case study.
Abstract
Recent advances in information technology have raised the issue of the extent to which the potential benefits gained by Radio Frequency Identification (RFID) outweigh the value of investment in such an initiative. Hence, this has become a matter of considerable concern and debate for both practitioners and academics alike. In view of the pre-mature level of RFID implementation and the analytical difficulties in the modeling of RFID deployment, it seems rational to resort to the technique of discrete event simulation. As a result, this paper presents an application of simulation to a third-party logistics provider (3PL) in order to determine the relative effectiveness of RFID within warehousing operations (receiving, put-away, picking, and shipping). Empirical data has been gathered from a company that deals with paper trading and uses its own assets and resources to provide a variety of services (including provisional warehousing, transportation management, distribution management, and freight consolidation) on behalf of other companies. Results indicate that RFID alleviates the ill effects of manual scanning and verification by automating the warehousing processes; eliminating errors, the labor intervention and the required time to check for any discrepancies, while increasing the throughput speed of product and the inventory accuracy.
... [ Lee et al., 2004 ;Saygin, 2007 ;Karagiannaki et al., 2007] traitent l'apport de la technologie RFID dans la gestion des inventaires. En se basant sur la simulation, Les auteurs montrent qu'avec la technologie RFID les processus d'entreposage sont optimisés et les stocks sont suivis avec davantage d'exactitude. ...
... Coûts [Sahin, 2004 ;Gaukler, 2005 ;Sounderpandian et al., 2006 ;Lee & Özer, 2007 ;Saygin, 2007 ;Bottani & Rizzi, 2008 ;Kok et al., 2008 ;Ozelkan & Galambosi, 2008 ;Wang et al., 2008 ;Çakici et al., 2011] Rotation de stock [Wang et al., 2008] Délai [Katz, 2006] Qualité [Fosso Wamba et al., 2008 (c )], Réduction d'erreurs [Atali et al., 2006 ;Harry et al., 2006 ;Sounderpandian et al., 2006 ;Heese, 2007 ;Huber & Michael 2007 ;Rekik et al., 2007 ;Kim et al., 2008 (a) ; Sarac et al., 2008 ;Rekik et al., 2009 ;Çakici et al., 2011] Niveau des stocks Karagiannaki et al., 2007 ;Saygin, 2007 ;Bottani & Rizzi, 2008 ;Wang et al., 2008 ] Profit [ Sarac, 2010] Rupture de stock [Kang & Gershwin, 2005 ;Loebbecke, 2005 ;Atali et al., 2006 ;Hardgrave et al., 2006 ;Sarac et al., 2008 ;Dolgui & Proth, 2008 ;Sarac, 2010;Ilie-Zudor et al., 2011] Niveau de service Chow et al., 2006 ;Harry et al., 2006 ;Karagiannaki et al., 2007 ;Saygin, 2007 ;Sarac et al., 2008 ] Optimisation des ressources [Chow et al., 2006 ;Harry et al., 2006 ;Poon et al., 2009] lisent automatiquement les procédures d'assemblage du châssis afin que les bonnes pièces y soient installées. [Strassner & Fleish, 2005 ;Manik et al., 2007 ;Mourtzis et al., 2008] montrent également les avantages de la RFID dans l'industrie automobile. ...
... Coûts [Sahin, 2004 ;Gaukler, 2005 ;Sounderpandian et al., 2006 ;Lee & Özer, 2007 ;Saygin, 2007 ;Bottani & Rizzi, 2008 ;Kok et al., 2008 ;Ozelkan & Galambosi, 2008 ;Wang et al., 2008 ;Çakici et al., 2011] Rotation de stock [Wang et al., 2008] Délai [Katz, 2006] Qualité [Fosso Wamba et al., 2008 (c )], Réduction d'erreurs [Atali et al., 2006 ;Harry et al., 2006 ;Sounderpandian et al., 2006 ;Heese, 2007 ;Huber & Michael 2007 ;Rekik et al., 2007 ;Kim et al., 2008 (a) ; Sarac et al., 2008 ;Rekik et al., 2009 ;Çakici et al., 2011] Niveau des stocks Karagiannaki et al., 2007 ;Saygin, 2007 ;Bottani & Rizzi, 2008 ;Wang et al., 2008 ] Profit [ Sarac, 2010] Rupture de stock [Kang & Gershwin, 2005 ;Loebbecke, 2005 ;Atali et al., 2006 ;Hardgrave et al., 2006 ;Sarac et al., 2008 ;Dolgui & Proth, 2008 ;Sarac, 2010;Ilie-Zudor et al., 2011] Niveau de service Chow et al., 2006 ;Harry et al., 2006 ;Karagiannaki et al., 2007 ;Saygin, 2007 ;Sarac et al., 2008 ] Optimisation des ressources [Chow et al., 2006 ;Harry et al., 2006 ;Poon et al., 2009] lisent automatiquement les procédures d'assemblage du châssis afin que les bonnes pièces y soient installées. [Strassner & Fleish, 2005 ;Manik et al., 2007 ;Mourtzis et al., 2008] montrent également les avantages de la RFID dans l'industrie automobile. ...
This research studies the contributions of the application of RFID technology in transport and to evaluate the impact of this integration on the performance of the Global Supply Chain. We put a special focus on the importance of providing continuous traceability in a complex environment where reactive decisions must be made following the occurrence of uncertain events. We analyse the suitability of implementing RFID technology in picking, loading, routing and unloading processes, while highlighting how the Supply Chain reacts to the different hazards that products can face during their transfer to customers. To measure the impact of the integration of RFID on the performance of the Supply Chain, we adopt a simulation-based approach to enable a quantitative comparison between a real system adopting barcode technology and the changes that occur when this evolves into a system equipped with RFID technology. We simulate three scenarios: barcodes, RFID on pallets, RFID on boxes. We choose the modeling tools that describe the various processes of the supply chain and take into account the time dimension and the dynamic aspect. We model the process of Supply Chain using the SCOR model and the UML activity diagram. We describe later various changes affecting the structure due to the introduction of RFID technology. The proposed models are the basis for the evaluation of performance. We integrate these models in simulation software ARENA and simulate the three scenarios presented above: (Barcode, RFID on pallet and RFID on boxes. We compare the three scenarios by presenting two models. In the first, we assumed that the product's customer shipments were done correctly without any error observed. The usefulness of this stage was that it tested the robustness of the model being simulated. Our second model randomly introduced events that might occur when products were transferred to customers. The aim here was to assess how the transport chain behaved in this kind of situation, and to measure performance achieved with and without system automation. We evaluate the impact of using technology on performance by measuring some indicators from the SCOR model and directly impacted by the use of technology RFID: responsiveness, flexibility and utilisation of resources.
... The study considers one of its warehouses as a typical mediumsized one. In the following sub-sections we will illustrate the main points of this application of the proposed framework (for a more detailed discussion of the case study, the interested reader is referred to Karagiannaki et al. (2007). ...
Empowered by the possibility to automatically identify unique product instances, the emerging Radio Frequency Identification (RFID) technology is expected to revolutionize the supply chain processes. However, in view of the numerous possible ways that RFID can be implemented within the supply chain, the issue of supporting the design choices based on a credible assessment between the current (as-is) and the future (to-be) processes has become a matter of considerable concern and debate for both practitioners and academics alike. To design RFID implementations in the supply chain using a robust dynamic analysis, we resort to discrete event simulation. As a result, this paper proposes a reference step-by-step framework that demonstrates the value of simulation modeling as a decision support tool to guide the design choices regarding the RFID implementation in the supply chain. To illustrate and assess the framework, a case study in the warehouse context is described.
In this paper, we review simulation and modeling techniques focusing on green and sustainable supply chains. We start by introducing green supply chains and the importance of being aware of environmental friendliness. We show how environmental performance is measured and analyzed, and then discuss the extension of green to sustainable supply chains. Taking into account the complex interrelations within supply chains, we give an overview of modeling and simulation techniques. This enables us to explain how supply chain behavior can be predicted and optimized under a set of given objectives. We conclude by suggesting the possibilities provided by modeling and simulating green and sustainable supply chains and propose future research.
Due to the high levels of flexibility and uncertainty associated with the deployment of RFID technology in the supply chain (e.g. alternative investment implementations based on the number of RFID-enabled processes or the different supply-chain nodes involved—e.g. stores, warehouses etc.), Real Options analysis becomes strongly suitable. In contrast to the few previous works that demonstrate the suitability of Real Options analysis for RFID investments through hypothetical numerical examples, this paper employs empirical data from a real case firm: 3E Coca-Cola HBC Greece. The proposed model for the case application addresses the simultaneous optimization of RFID investment timing and scale, in the face of (a) substantial uncertainty regarding the products circulated from and among the firm’s premises and (b) largely irreversible investment costs associated with RFID adoption (hardware infrastructure, tags, training and maintenance, etc.). A unique feature of our proposed modelling framework, with implications for a range of other supply chain information technologies with characteristics similar to RFID, is the explicit determination of the volatility of cash flows/revenues that will accrue from adopting the RFID technology from the volatility of RFID tagged items that are circulated from and among the business nodes. This alleviates the need to approximate or estimate the state-variable volatility (undeniably the most difficult parameter to infer in real options applications) through inaccurate or other questionable methods that have been employed in similar case studies in the literature.
Prior empirical research on the evaluation of RFID technology
treats and assesses individual RFID applications
independently and in isolation from each other. However, literature on investment evaluation of information technologies has recognised and utilised the significance of evaluating “interdependent” information systems (IS) projects with synergies. Moreover, previous studies when appraising the business value of an RFID investment ignore its opportunity to offer and evolve into additional follow-on investments
in the future. Nevertheless, the importance of this notion has been acknowledged by the pertinent literature for the evaluation of other information technologies. This chapter proposes an approach for the investment evaluation
of RFID applications considering them rather as a bundle of interdependent and sequential investments than as stand-alone ones. The results from a case study demonstrate how the proposed approach can be employed for the evaluation of RFID projects and offering an additional insight into evaluating investments in RFID applications.
«RÉSUMÉ» : Définie comme une technologie sans-fil d’identification et de collecte automatique des données, la technologie d’identification par radiofréquence (RFID) est en train d’émerger comme un nouveau système inter-organisationnel, qui va profondément transformer les processus et pratiques d’affaires de la chaîne d’approvisionnement. Toutefois, l’importance de la co-adoption de la technologie RFID et du réseau EPC dans la chaîne d’approvisionnement a jusqu’à présent reçu peu d’attention dans la littérature et très peu d’études empiriques ont été menées sur la valeur et les impacts de cette co-adoption de la RFID et du réseau EPC dans un contexte de chaîne d’approvisionnement. Cette recherche représente un premier effort visant à combler cette lacune dans la littérature sur ces questions spécifiques.
Notre étude s’appuie sur la revue de littérature existante sur la technologie RFID et le réseau EPC, la théorie de la gestion de l’innovation, la gestion de la chaîne et les systèmes inter-organisationnels pour répondre aux questions de recherche suivantes : (i) Que comprend précisément la technologie RFID?; (ii) Quelle est l’infrastructure minimale que requiert cette technologie?; (iii) Quel lien existe-t-il entre la technologie RFID et le réseau EPC?; (iv) Quel rôle pourrait jouer un laboratoire universitaire dans le processus d’adoption de la technologie RFID et du réseau EPC?; (v) Quels sont les impacts de la technologie RFID et du réseau EPC sur les processus d’affaires et les flux d’informations intra- et inter-organisationnels, sur la main-d’œuvre, et sur les modèles d’affaires; (vi) Quelles sont les stratégies à mettre en œuvre pour, d’une part, guider l’élaboration et la mise en œuvre des divers scénarios d’adoption intégrant la technologie RFID et le réseau EPC et, d’autre part, faciliter la communication entre les différents acteurs impliqués dans le processus d’identification des modèles d’affaires appropriés et les infrastructures technologiques pouvant supporter l’adoption d’un scenario intégrant de ces technologies?»----------«ABSTRACT : Defined as a wireless automatic identification and data capture (AIDC) technology, the Radio frequency identification (RFID) technology is emerging as an innovative inter-organizational system (IOS) that will profoundly transform the supply chain business processes and practices. However, the importance of the co-adoption of RFID and the EPC network within the supply chain has so far received insignificant attention in the literature and very few empirical studies have been conducted on the value and impacts of the co-adoption of RFID and EPC network in a supply chain context. This research represents an initial effort towards bridging the existing knowledge gap on these specific issues.
Our study draws from the literature review on the RFID technology and the EPC network, the innovation management theory, the supply chain management and the inter-organizational systems to examine the following research questions : (i) What precisely does the RFID infrastructure include?; (ii) What is the link between the RFID technology and the EPC network? (iii) What role could play a university-based laboratory in the adoption process of the RFID technology and the EPC network?; (iv) What are the impacts of the RFID technology and the EPC network on intra-organizational and inter-organizational business processes and information flows, on the workforce, and on the existing business models; (v) What strategies should be implemented in order to, first, guide the development and the implementation of various adoption scenarios integrating the RFID technology and the EPC network, and, secondly, facilitate communication between the different stakeholders involved in the process of identifying the appropriate business models and technological infrastructure supporting the adoption of an optimal scenario integrating these technologies?»
The main objective of this pilot study is to improve our understanding of the potential of RFID in the context of warehousing activities in one specific supply chain in the retail industry. Empirical data was gathered from four tightly inter-related firms from three layers of the supply chain. Results indicate that RFID appears to be a disruptive technology as it supports a new business model, entails major redesign of existing processes and fosters a higher level of electronic integration between supply chain members.
In today’s global market, managing the entire supply chain becomes a key factor for the successful business. World-class organizations now realize that non-integrated manufacturing processes, non-integrated distribution processes and poor relationships with suppliers and customers are inadequate for their success. They realize the impact of an organization’s plan on the other areas of the supply chain. The impact of an organization’s plan on the whole supply chain is unpredictable before its execution. Simulation permits the evaluation of operating performance prior to the execution of a plan. In the practical application of this concept, the development of the simulation model for the supply chain management has become a necessity. This paper discusses the issues of supply chain management and the requirements for supply chain simulation modeling.
Management is on the verge of a major breakthrough in understanding how industrial company success depends on the interactions between the flows of information, materi-als, money, manpower, and capital equipment. The way these five flow systems interlock to amplify one another and to cause change and fluctuation will form the basis for antici-pating the effects of decisions, policies, organizational forms, and investment choices." (For-rester 1958, p. 37) Forrester introduced a theory of distribution management that recognized the integrated nature of organizational relationships. Because organizations are so intertwined, he argued that system dynam-ics can influence the performance of functions such as research, engineering, sales, and promotion.
Increasing the run-length of a non- terminating steady-state simulation improves confidence in the results obtained. Yet the questions need to be asked: how long should a run be and what level of confidence is obtained? This paper describes an heuristic technique for selecting the run-length which enables the user to measure the level of confidence achieved. An heuristic technique has been developed deliberately to enable implementation by both expert and non- expert users.
Discrete event simulation (DES) has been widely applied to modelling and simulation of computer and engineering systems and is an active field of research that has now evolved from 2D to 3D discrete event simulation. This paper attempts to address several key issues in a successful implementation of DES models based on our own and the previous experiences of others. It describes the common basis, which forms the core for the application of modelling and simulation methodologies that are available to support manufacturing systems analysis, design and performance evaluation. Through a comprehensive literature survey, this paper summarises and compares the most widely used optimisation techniques for simulation of manufacturing systems; an overview of the recent and popular simulation languages and packages available for the modelling and simulation community and the classification of their utility for modelling and simulation of manufacturing systems is also given. Finally, this paper summarises and reports the latest development in the most exciting world wide web (www)-based simulation techniques that represent a future that may completely change the nature and future exploitation of modelling and simulation technology in industry.
This paper surveys verification and validation of models, especially simulation models in operations research. For verification it discusses 1) general good programming practice (such as modular programming), 2) checking intermediate simulation outputs through tracing and statistical testing per module, 3) statistical testing of final simulation outputs against analytical results, and 4) animation. For validation it discusses 1) obtaining real-worl data, 2) comparing simulated and real data through simple tests such as graphical, Schruben-Turing, and t tests, 3) testing whether simulated and real responses are positively correlated and moreover have the same mean, using two new statistical procedures based on regression analysis, 4) sensitivity analysis based on design of experiments and regression analysis, and risk or uncertainty analysis based on Monte Carlo sampling, and 5) white versus black box simulation models. Both verification and validation require good documentation, and are crucial parts of assessment, credibility, and accreditation. A bibliography with 61 references is included.
Thesis (S.M.)--Massachusetts Institute of Technology, Dept. of Mechanical Engineering, 2000. Includes bibliographical references (p. 61-64). by Yogesh V. Joshi. S.M.
The use of system dynamics modeling in supply chain management has only recently re-emerged after a lengthy slack period. Current research on system dynamics modelling in supply chain management focuses on inventory decision and policy development, time compression, demand amplification, supply chain design and integration, and international supply chain management. The paper first gives an overview of recent research work in these areas, followed by a discussion of research issues that have evolved, and presents a taxonomy of research and development in system dynamics modelling in supply chain management
An Information Infrastructure for RFID-Enabled Traceability in the Supply Chain
- T Kelepouris
- K Pramatari
RFID in the Retail Supply Chain: Benefits, Roll-out Strategies, and Cost Sharing Agreements, The Supply Chain Connection, Newsletter of the Stanford Global Supply Chain Management Forum
- G Gaukler