Performance evaluation of a traceability system. An application to the radio frequency identification technology

Abstract

The desire for reduced operation costs, high quality products and services, a better monitoring of items for a targeted intervention in case of critical situations and the increasing demand for security and safety from final consumers sets high requirements for well structured traceability systems. Advances in information technology permit synchronization between physical and information flows and coordination of activities among supply chain partners. Bar code and radio frequency identification (RFID) systems are examples of such technologies that permit us to collect data about logistics transactions of items, store and organize them in order to use this information in enterprises' management control, decision analysis and strategic planning systems. Within a company, the use of a specific item identification technology or the decision of switching from a technology to another is an important decision since it could have expensive consequences. The purpose of the paper is to provide a framework for identifying principles and functionalities of a traceability system in the context of a global supply chain. Using assessment criteria obtained by this analysis, we evaluate the performance of bar code and RFID systems. Finally, we describe benefits (measured as reduction in costs, improvement in the customer service level, etc.) that RFID technology can provide to supply chain processes.