RFID + ERP = Supply Chain Visibility

Filed in archive Software Applications on November 1, 2004

Third-party logistics providers have to get on board with RFID to meet their customers' demands. So concludes a recent study of 650 logistics executives by Capgemini, sponsored by fedex.

The number one IT-based service that corporate executives said they needed from their third-party logistics providers in the future turned out to be -- you guessed it -- RFID. All regions of the world rated RFID as the number one need:

• Western Europe 61%


• Asia Pacific 59%


• North America 53%


• Latin America 48%

That should not be surprising. RFID together with good ERP systems promise to give companies better visibility into their supply chains.

As this article in BPM-Today points out:

"...[Companies] that could view data in detail reported faster inventory turnaround and sales cycles.

The difference between companies with a high level of visibility into their supply chains and those with a low level of visibility is striking, according to the study.

High-visibility firms averaged 14.6 inventory turns, 22.1 days sales of inventory, and 26.1 average days sales outstanding compared to 9.8, 38.2 and 39.4 respectively among low visibility firms."

The BPM-Today article also refers to a research report by the Yankee Group. MarketResearch.com has the report and you can even search inside the report using keywords -- it's a neat feature.