How RFID Can Provide Critical Real-Time Production Information

By Amila Nandasekera

June 20, 2011—In today's complex business environment, managing by crisis or firefighting to achieve a target is never the recommended method of managing production. Instead, the setting of clear objectives can help deliver a product to a customer on time, and in the proper quantity and quality. The better able a company is to achieve 100 percent on-time delivery (OTD), the more likely it will satisfy its customer and thereby retain and expand its market share. In the light of managing by objectives, real-time information regarding key performance indicators (KPIs) is pivotal for driving processes toward meeting a company's production targets. Radio frequency identification can play a critical role in providing a firm with this real-time information.

Once a company has set organizational objectives, it can periodically compare them against individual performance, and determine if additional training and other measures are required for employees who have not yet fulfilled those objectives. Only by maximizing individual performance can any business achieve its strategic goals.


The garment industry can be viewed as a typical example of the proven business value of managing by objectives. In that sector, a major customer-related KPI is to strive for 100 percent OTD for all products. To achieve this goal, a subset of objectives—such as maximizing process efficiency, having raw materials in-house on time, and minimizing absenteeism and process defects—are set. These objectives must be achieved in order to attain 100 percent on-time delivery.

Real-time information can keep you abreast of production progress across all processes at every minute, and is all about keeping management updated on KPI variation at all times, or at regular intervals, thereby highlighting supply chain issues as they arise, so that they can be addressed a lot faster before spilling over into the next supply chain segment. Real-time information regarding KPIs, provided to workers on various display devices on the shop floor, is key to motivating them to remain on track to hit a target, and to not lag behind it.

Pilot findings on how real-time information through RFID leads to managing by objectives

Low-frequency passive RFID tags used for the pilot

In February 2008, the production staff at a leading garment factory in Sri Lanka tested the use of RFID on a selected sewing line, in order to prove to the plant's top management the value of real-time information in managing production by objectives in a real-world scenario. The project—initiated by my company, Sabre Technologies, as a free-of-charge pilot—had a great deal of support from me, as well as from Sabre's technical staff, backed by a senior-management team.