Evaluating RFID opportunity through process analysis

Abstract

Current literature agrees that one of the main results obtained by adopting RFID lies in an improved efficiency increase in material handling operations, especially regarding reductions in the time required to perform certain procedural steps. However, by evaluating only the advantages that can be easily quantified and definitely achieved may lead to limited results. This paper presents a business case of a large European Consumer Packaged Goods (FMCG) company in the cosmetics and beauty sector. Eleven processes in receiving, handling, storage and delivery procedures in one of the main distribution centres of the company were analysed and modelled using a detailed Business Process Modelling (BPM) approach. Since savings were evaluated only in terms of the reduction of resources used-achieved through process acceleration-despite the company dealing in huge volumes of high-margin products, the feasibility study turned out to be negative. Thus, the paper concludes with a brief discussion of how companies should take on this challenge if process timing benefits are insufficient. The detailed process analysis reported in this paper may be useful for operation practitioners or any manufacturing company or distribution centre about to start an as-is versus to-be comparison of their material handling procedures for RFID implementation.

Economic Evaluation of RFID Technology in the Production Environment

“…Busato et al [25] analysed the opportunity of introducing RFID in a large European Consumer Packaged Goods (FMCG) company in the cosmetics and beauty sector. Eleven processes in receiving, handling, storage and delivery procedures in one of the main distribution centres of the company were analysed and modelled using a detailed business process modelling approach.…”

The Logistic Maturity Model: Application to a Fashion Company

“…It is clear that these types of AIs are related to maturity Level 3, mainly referring to process formalization. Thus, the BLS started a business process modelling project, aiming to map all of its processes with BPMN2.0 notation [51], and to include the adoption of RACI matrices [52] to define responsibilities. In order to increase the P0.1 maturity score in Level 4 and Level 5: one out of eight achievements in the BLS related to maturity Level 4 and Level 5 in P0.1 had been reached. The BI-Team decided to pursue two out of the seven missing achievements, namely those related to the forecasting sub-process (P0.1/AC5.1 and P0.1/AC5.2).…”

“…It is clear that these types of AIs are related to maturity Level 3, mainly referring to process formalization. Thus, the BLS started a business process modelling project, aiming to map all of its processes with BPMN2.0 notation [51], and to include the adoption of RACI matrices [52] to define responsibilities.…”

Minimizing Warehouse Space with a Dedicated Storage Policy

“…Thus, with the aim of reducing this significant impact upon production companies, attention was paid to managing warehouses in a cost-effective way [3,4,5,6,7]. From a management perspective, warehouses' organizational phases are the most critical in determining an ideal layout configuration and an efficient material handling structure [8,9,10,11]; however, these cost elements seem to be strictly related to the usage of proper item-tracing tools [12,13,14] on top of an appropriate product allocation [15,16,17,18,19].…”