Inventory Management Control Systems

At their best, the impact of an inventory management system is profound. Inventory control programs improve operations planning, warehouse management, sales forecasting, and other systems. Inventory management and improved inventory control can influence performance metrics and seasonal purchasing. RFID has been used to improve inventory management control systems for years.

Inventory control is not just in places you may expect RFID to also be used, such as manufacturing, warehouse or distribution function. Inventory management has significant impact on hospitals, offices, hospitality businesses, libraries, airlines and, obviously, retail. Inventory costs can range from 45-90% of the expenses of a business. If RFID can shave just a percentage of that cost, the net results could be quite profitable. Managing such assets gives you more control of your capital – which for many businesses far exceeds cash capital.

There are two things all inventory control systems have in common: goods and information. It’s the information that makes all the difference, because the goods will not help you make better decisions. They are either there or not. It is the decisions about them that matters.

Consider what information you are now getting; but more importantly – and often harder to spot – is what information you are not getting that you want to have. Since RFID inventory control and management systems can offer efficiencies previously unknown to your operation, if you never had certain data available to you before, it can be difficult to see what data you’ve been missing and how you can convert the resulting insights into action items.

Operations managers continue to find smart new ways to use RFID as part of an inventory management system.

Active, passive, and semi passive RFID technologies can all be used for inventory control; but each is going to have a different approach to meeting your requirements. Many factors go into a decision about how RFID might help:

• the environment – is it a rugged raw materials depot, harsh temperatures, or plush hotel?
• metal or other structural barriers
• value of items – you are unlikely to spend $30 for an active tag for each case of pet food; for aircraft engines and the additional data uses available, that may be a bargain
• 2D or 3D – in a warehouse, an X/Y location of an item is probably fine, but in a multi-story hospital, you need a third dimension. Depending on the RFID system, obtaining a Z coordinate can be tricky.
• How precisely does an item’s location need to be known? Active tags can give location down to about a meter; passive tags may simply register the last location seen.

A chief advantage of RFID is tracking the movement of inventory from one location to another, without human intervention. In most inventory applications of RFID there is just one thing it boils down to. You need to understand the zone.

A zone is a defined region inside, or outside, of your facility that items travel into and out of. It could be a work cell in a manufacturing facility, a quadrant of a distribution center, or an office. Your RFID system must have the ability to track movement between zones, when an item enters or exits a zone, and the amount of time an item remains in a zone. Better yet, is it there now?

Active systems are typically going to measure the signal strength or the time it takes a tag to respond to nearby readers. Passive and semi-passive systems typically read tags as they pass through entry point and exit points. Either type of system requires careful tuning the readers to limit the tags reads to a specific zone.

One of the main factors that will determine whether you use battery or non-battery powered tags is the size of what you are tracking and the size of the portals they travel through. Depending on the model, active tags can be read from 3 to 300 feet away, so they are very versatile. These tags can be configured to send out a signal at a specific interval.

If items are moving around frequently, then tags will most likely need to send out a signal more often. I’ve seen systems that take inventory as often as every few minutes and as rarely as once per day. Be sure to compare active systems that use 802.11 if you already have an existing network infrastructure in place.

Passive tags are lower cost and smaller in size, but have a shorter read range. If items are moving through 3 foot wide doorways, then a passive system may be just fine. Don’t expect them to work well in big open areas without carefully plotting reader placement and read fields. Other than cost, their big advantage is there is no battery power to run out of.

Semi-passive tags will perform similarly to passive except that a battery will be used to enhance the signal response. The added boost may be enough to overcome nearby metal or water or give you just a couple more feet. Remember the battery will add size to the tag, cost, and will eventually die.

You will have all of these factors to consider; but when you are at the drawing board, start with how the data will serve you and who it serves. How many users are there? Does it tie into supplier or customer systems? Does it tie into CMS or accounting systems? Often there is a Warehouse Management System in the picture. What about purchase orders, receiving functions, barcode scanning?