RFID BUSINESS PROCESSES
5.5 ADAPTIVE MULTI-LAYER RFID BUSINESS PROCESS MODELPROCESS MODEL
Business processes will become more adaptive (better known as the adaptive business processes) in response to emerging technologies, changing cus- tomer demands, new external threats, and new market opportunities, as well as changes in the implementation approach (e.g., from two-dimensional to multidimensional). It is important to consider what the risk, return, and fea- sibility of the RFID infrastructure are and how they can be adapted to business processes over time starting from the inner layers of the adaptive model.
Some adaptive business processes can also be dynamic. This model is more suitable for supply chain organizations that initially split their shipping into two parts. The first part is those shipping cases and pallets that have been RFID-enabled to meet mandates from large retailers. The second part is those shipping cases and pallets that have not been RFID-enabled for customers that have not issued the mandates. These cases and pallets were eventually to be RFID-tagged with the goal of placing RFID tags on indi- vidual times on a massive scale, if technologically practical and feasible.
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This model is suitable for a mid-sized or small supplier that voluntarily implements the RFID technology by providing their own equipment to meet the mandate.
5.5.1 Adaptive Maturity
Now let’s revise the model to show how business processes could become more adaptive and more dynamic as they move from the inner core to the outermost layer. What this means is we have an adaptive maturity that starts from the core of the process model and continues until it reaches the outermost layer of the model. The maturity is adaptive as compared to the static version as you have seen in the previous model. Adaptive maturity dynamically responds to the changing consumer demands, implementation approaches, technologies, and regulations whereas static maturity linearity responds to the same conditions. Adaptive response means feedback into the previous layers to create and automate business processes in response to technology changes, competitive market changes, and shifts in the economy. Figure 5.2 shows that each stage of the adaptive maturity could send feedback to any of the previous stages for further improvements before it returns to a higher layer.
Figure 5.2 Adaptive Multi-Layer Business Process Model
Enterprise systems business processes–
external and internal Middleware, standards, and integration tools
RFID–enabled business processes
RFID Technologies
138 RFID in the Supply Chain: A Guide to Selection and Implementation
As shown in the figure, if the maturity level reaches the second inner layer from the core layer, it can send feedback to the core layer and repeat the process. If the maturity level reaches the third layer, it can send feedback to either the core layer or the second inner layer and repeat the process if necessary. If the maturity level reaches the outermost layer, it can send feedback to one of the three ways: the core layer, the inner second layer, or the inner third layer.
As the maturity level moves to the next higher layer, the business pro- cesses mature from the strategy, plan, goals, and objectives layer spelling out what business processes to achieve to the enterprise layer. This spells out a complex set of enterprisewide business processes that you may need to implement when you move from the pilot study to a full-scale RFID implementation throughout the supply chain. The RFID benefits should result in the value perceived and expected by stakeholders in RFID imple- mentation, such as [1]:
Increased revenue Lower cost
Inventory reduction Reduced capital assets
Overall, adaptive and dynamic business processes appear to be an effective mechanism in improving and automating the processes, integrating a complex, redundant process, and improving performance. However, improving these processes for a wide range of disparate applications becomes very complex due to, for instance, interoperability problems among enterprise systems (e.g., SCP, SCE, and SCM), and the issue of integrating and automating business processes arises.
5.5.2 Application Adaptors
Unlike the basic version, the adaptive model employs application adapters where necessary. Application adapters are useful in resolving certain types of interoperability problems of integrating disparate applications and auto- mated business processes. Some software companies are offering product adapters to reduce or eliminate the time to customize adaptors to integrate disparate applications. For instance, IBM offers WebSphere Application Adaptors to allow users to exchange information between ERP, HR, CRM, and supply chain systems, such as those shown in Table 5.2.
A complete list of IBM Websphere Application Adaptors is available in the appendix. IBM is not the only vendor, however, to offer application, technology, or integration adaptors. Microsoft is another major player in its offerings of adapters for many of the Windows server systems.
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SAP NetWeaver comes with preintegrated business applications running on industry standard platforms, such as Java 2 Platform, Enterprise Edition (J2EE), Microsoft .NET, and IBM Websphere. Microsoft offers technology adaptors for Windows operating systems. However, IBM offers the Web- Sphere RFID Premises Server dedicated to aggregate, integrate, and monitor RFID data that you use to detect critical operational events.
5.5.3 The METRO Group
So how mature is the METRO Group? Before we can determine the maturity of this group, let’s rehash a little bit on what it has done. METRO Group hired IBM Business Consulting Services to provide middleware and instal- lation services for the RFID rollout that began in November 2004 with shipments of warehouse pallets and cases from 20 product suppliers, includ- ing Unilever, Procter & Gamble, Gillette, Johnson & Johnson, Kraft Foods, Colgate-Palmolive, GlaxoSmithKline, Nestlé, and Esprit. METRO Group has used an IBM RFID middleware based on the IBM WebSphere RFID Premises Server to provide the retailer with a virtual view of RFID-tagged pallets and cases shipped to its distribution center and exchange data with METRO’s merchandise management system.
METRO’s RFID rollout grew to about 100 suppliers by December 2004 and is expected to grow to about 300 suppliers by 2006, along with addi- tional METRO warehouses and stores in Germany. Early deployment in November 2004 was influenced by METRO’s belief that the results of the Future Store Initiative indicated that process efficiency and merchandise availability increased by about 14 percent and losses and theft were reduced about 15 percent.
Let’s take a look at how the METRO Group uses the IBM WebSphere RFID Premises Server to improve adaptive business processes. This server is part of the IBM RFID product package. Completing the package are devices and a WebSphere Integration server. WebSphere RFID Premises
Table 5.2 Application Adaptors
Oracle SAP Software Claify CRM
PeopleSoft Enterprise Portal Internet i2 Active Data Warehouse SunGard FRONT
ARENA
Websphere Commerce Adapter
CORBA Adapter for Enterprise
JavaBean (EJB)
Lotus Domino Data Handler for EDI Web Services Java-based HTTP
Adapter
WebSphere MQ Workflow Adapter
140 RFID in the Supply Chain: A Guide to Selection and Implementation
Server is designed to detect critical operational RFID events from various devices we have talked about in previous chapters. The server helps to reduce out-of-stock situations by increasing stock visibility, and reduce shrinkage, return, and reconciliation costs by visible tracking, rotating, and allocation of the products. It also allows collaboration and sharing of data within an enterprise and with trading partners.
To improve business processes and integrate business information, the WebSphere Business Integration Server, as its name implies, does the job.
The server helps users to create business processes and integrate business information in multiple business applications across diverse platforms. It also allows the users to improve business processes in response to changes in a highly competitive market due to emerging technologies and shifts in the economy. The server comes with both preintegrated adapters and pro- cess templates. Additional information about the IBM integration servers and associated components is available in Appendix N.
Given the brief information about the technologies the METRO Group is using to improve and integrate business processes, the group is expected to reach its full maturity. The maturity will be adaptive rather than static as the METRO Group appears to be flexible in adapting to new technologies and business processes in each stage of maturity level.