Supply Chain Management
technologies: RFID and XML
RFID:
Radio Frequency Identification
Reader (transmitter/receiver)
Tags that respond to a radio frequency
Transmits unique Identifier 8-12 bytes
(characters) at different frequency
 Does not have to be line-of-sight

Lots of Applications Software
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 2
Applications
Check out: POS terminal
Inventory tracking (Wal-Mart, DoD)
Animal tagging
Secure car key (Toyota)
Purchase gasoline (Mobil)
Doorway access control
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 3
Passive vs. active tags
Passive tags
Uses transmitter RF signal for power
 Long lifespan
 Costs start at about twenty cents
 Low frequency: range is less than 6 inches
 High frequency: range up to 12 inches
 Ultrahigh frequency: several yards

Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 4
Active tags
Active tag
Uses a battery to respond
More range, up to 1Km
3-5 year battery life
Can cost several dollars
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 5
RFID quiz
Q 1: What kind of tags are we using in
lab?
Q 2: Does the orientation of the tag
affect the ability to read its contents?
(try all of the tags)
Q 3: Does placing a tag in a metal can
affect the ability to read its contents?
Q 4: Why is the flat tag Read/Write?
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 6
RFID advantages
Less human intervention
Real-time information flow as item changes
state:



Off truck
Off shelf
Purchased by customer
Reduce lost or stolen inventory
Machine-to-machine communication

Package routing
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 7
RFID challenges
Interference with object or other readers
Range
Data formats and standardization

Different countries allocate different
frequencies
Cost for readers, tags and system
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 8
Bar Code vs. RFID scanning
Line of sight
Right-side-up (must
physically align
carton)
Can tear
Limited amount of
data
No encryption
Chapter 2
Can read through
objects
Tag orientation less
of a problem
Can store
megabytes of data,
if needed
Can be encrypted
Principles of Information Systems,
Fifth Edition
Slide 9
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 10
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 11
UPC versus EPC
Universal Product
Code
For Bar coding
Contains MFR ID
number (5 digits) and
Item Number (5
digits)
Chapter 2
Electronic Product Code
for RFID apps.
Contains 96 bits:



EPC manager ID (MFR)
Object class
Serial number
Can track a particular
case of toothpaste !
Principles of Information Systems,
Fifth Edition
Slide 12
RFID supply chain integration
Supplier:
Store EPC & pallet
contents on DB
EPC has supplier-ID
and database key.
Ship pallet with tag
Chapter 2
Buyer /shipper:
Pallet arrives
automatically
scanned for EPC
Get contents from
Supplier DB
Principles of Information Systems,
Fifth Edition
Slide 13
RFID future
RFID tag as a sensor


Temperature: spoilage
Package opened: drugs
Larger memory:

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Car repair history
Medical history
Can we recycle RFID tags?
Chip-kill technology
Privacy: track movement of people (ID card, EZPASS) or post-sale disposition of items.

Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 14
Supply Chain Management
(SCM)
Definition:
A cross-functional inter-enterprise
system that uses information technology
to help support and manage the links
between some of a company’s key
business processes and those of its
suppliers, customers, and business
partners
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 15
SCM Life Cycle
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 16
Electronic Data Interchange
(EDI)
Definition:
Involves the electronic exchange of business
transaction documents over the Internet and
other networks between supply chain trading
partners
Standard industry format to send RFQ, PO,
Receiving notice, payment notice, Invoice,
Payment remittance notice, etc.
Now being replaced by Web and XML.
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 17
EDI Activities
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 18
SCM Planning Functions
Supply Chain Design – optimize
network of suppliers, plants, and
distribution centers
Forecasting customer demand by
sharing demand and supply forecasts
instantaneously across suppliers and
distributors
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 19
SCM Execution Functions
Materials Management – share accurate
inventory and procurement order information,
ensure materials required for production are
available in the right place at the right time.
Collaborative Manufacturing – optimize plans
and schedules while considering resource,
material, and dependency constraints
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 20
SCM Execution Functions
Collaborative Fulfillment –order management,
vehicle scheduling, and support the entire
logistics process, including picking, packing,
shipping, and delivery in foreign countries
Supply Chain Event Management – monitor
every stage of the supply chain process, from
price quotation to the moment the customer
receives the product, and receive alerts when
problems arise – visibility!
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 21
Business Value of SCM
Benefits of SCM:
Reduces production and distribution
costs


More information =>
less inventory, less lead times needed
Improves timeliness of shipments
Increases supply chain “velocity”
 More accurate fulfillment
 Improves “visibility” of supply chain

Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 22
SCM Benefits
Fewer employees needed to manage supply
chain
Better customer satisfaction: less stock-outs
Strategic relationship with suppliers, enables
new business partnerships:
 Collaborative Planning, Forecasting, and
Replenishment systems (CPFR).
 Collaborative downstream customer
service, marketing, and relationship
management.
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 23
Technical Challenges of SCM
Acquisition of secure extranet
Software can be confusing,
contradictory and not sculpted to their
needs – difficult to implement.
Emerging standards, high costs.
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 24
Organizational challenges
Changes company structure: resistance from
employees wedded to traditional processes, leads to
lack of adequate collaboration among marketing,
production, and inventory management departments
within a company
Supplier reluctance or incompatibility issues.
Lack of proper demand planning knowledge:
leading to inaccurate or overoptimistic demand
forecasts. Need new tools and guidelines.
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 25
Fun with XML
Standard way to describe structured
data within an organization or across
the Web (metadata included in file).
Can check validity using a set of rules in
a schema definition (xsd) file, using a
validating XML parser.
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 26
XML rules
Each element tag is user-defined, within
angle brackets:
<purchaseOrder> … </purchaseOrder>
Each element can have sub-parts:
 <Address>
<street> 515 Loudon Rd. </street>
 <city> Loudonville </city>


</Address>
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 27
XML Schema definition file
Rules besides “well-formed” XML:

Order of elements

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Data type: string, date or decimal

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<xsd:sequence> … </sequence>
<xsd:element name=“zip” type=“xsd:decimal” />
Optional elements:

Chapter 2
minOccurs=“0”
Principles of Information Systems,
Fifth Edition
Slide 28
On Your Own
Coors Case worksheet
XML exercise
Online quiz
Chapter 2
Principles of Information Systems,
Fifth Edition
Slide 29