Management Throughout the Value Chain
Managers in today’s business environment find themselves not only focused on internal processes such as production efficiency and employee relations, but also acknowledging the need to increasingly focus on management throughout the value chain. A number of researchers (Anderson & Dekker, 2009; Smith & Minutolo, 2014; Smith & Offodile, 2007; Wee, Peng, & Wee, 2010; Whitten, 2004) have identified some of the complex components of the supply chain to include global suppliers, contract manufacturers, company-owned product/service centers, third-party logistics providers, and transportation providers. Each relationship in the supply chain poses unique management opportunities and challenges. It is important for firms to understand the existing tools and strategies in the operations management field as well as the developing technologies and practices to better control costs and enhance efficiency in the supply chain. These same researchers frequently cite that the management of many companies are not operationally efficient (e.g., it can be seen from the cost of production is larger than needed, generating waste and non-value activities, and lack of vender collaboration and integration, to name a few related issues). Proper management of their supply chains can dramatically improve such efficiencies. In the following sections, a number of studies suggest that the use of RFID in supply chain management (SCM) can improve operational efficiency. This this chapter briefly discusses the contribution of knowledge regarding the use of RFID in the operational efficiency of the company.
In order to stay competitive in the marketplace, firms must do whatever is necessary to gain an edge and create value for their product. The desired end goal is to get the right product to the right customer at the right price at the right time; to accomplish this chain of events firms must search for methods to achieve a competitive edge. In this increasingly global economy, competition for buyers can be cut-throat because of the easy access to the international market and global materials because of the internet. Also, because of the need for speed, space issues, and timing, supply chain agreements frequently expect the raw materials to arrive at the right warehouse or facility at the right time, not a week before or later. Needing to stop production because a part is missing is disastrously expensive; also loss of goods or theft is frequently a concern with companies. So the issue is raised, how can a company make improvements in the supply chain to be more efficient? Value is created for the client when the item arrives to the client on the right day. When an item is late or there are stock-outs there is the risk of the bullwhip effect occurring, when the client over-orders because they fear they might have their order rationed. By tracking the orders and products with barcode and/or RFID technologies (Ha, Park, Lee, & Park, 2013; Kwok & Wu, 2009; Mateen & More, 2013; Mehrjerdi, 2009; Roberti, 2014), operational management have the enhanced ability to notice if there are inefficiencies within the organization and address them quickly, and if the capability allows, the client can see that they will receive their order exactly when they wished in the quantity that they desired. This technology can add value all throughout the supply chain, to include the warehouse, distribution, and returns management areas.