RFID and ERP: Connecting Frontline Data with Business Management
RFID enables organizations to read codes from tags attached to products and assets using radio waves. In some applications, an RFID reader can read multiple tags within a defined area, reducing the need to scan items one at a time. Reading performance depends on the equipment, the items being tagged, and the surrounding environment.
The data collected can create greater business value when it is validated and connected to the organization’s management systems. An ERP (Enterprise Resource Planning) system, for example, helps bring together and connect data across business processes such as purchasing, sales, finance, and inventory, giving teams information to support their work and decision-making.
How Does RFID Connect to ERP?
An RFID-to-ERP setup typically includes RFID tags attached to products, RFID readers that capture the codes stored on those tags, and software that receives, validates, and transfers the data to the relevant systems.
A typical data flow may look like this:
After a reader captures a code from a tag, the software can use that code to look up or match the relevant product information and document lines. The validated data can then be used in the appropriate ERP processes.
For example, Microsoft Dynamics 365 Business Central is an ERP system that supports key business processes such as finance, sales, purchasing, and inventory management. To use RFID data with Business Central, organizations need to consider the RFID reading devices, the software or extensions involved, and how the data should connect with their business processes.
How RFID Data Can Support Business Processes
When RFID and ERP systems are appropriately connected, the data captured may support tasks such as:
- Receiving goods into a warehouse: Compare codes read from tags with items on a purchase order or receiving document to check whether the goods received match what was expected.
- Counting inventory: Compare the codes read from tags with inventory records in the ERP system to identify matching items and investigate discrepancies.
- Tracking movements: Record events when goods pass designated reading points, such as receiving, storage, or dispatch areas, to help track their movement.
- Supporting related processes: Once validated, the data may be used to support inventory management or other ERP processes, depending on the organization’s requirements.
Good to knowReading a tag does not guarantee that ERP data will always be accurate or update automatically. The system should include validation rules, such as matching tag codes against documents, handling duplicate reads, and flagging unread tags or mismatched data.
What to Consider Before Implementing RFID
Before investing in RFID, identify the problem you want to solve and the outcomes you expect. This will help you select suitable equipment and design a system that fits your actual operations.
Key considerations include:
- Tag and reader types: Choose equipment suited to the items, reading distance, and intended use.
- Product materials: Metal and liquids may interfere with some types of RFID reading. Test the tags and their placement on actual products.
- Reading areas and distances: Define where data should be read and the areas that need coverage, so readers fit into the workflow.
- Number of items to read: Assess the volume of items and the required reading speed to select equipment with suitable capacity.
- Data validation and error handling: Plan for unread tags, duplicate reads, and data that does not match system records.
- Software integration: Check whether the solution can connect with existing systems, such as a Warehouse Management System (WMS), ERP, or other relevant software.
- Total cost of ownership: Consider the cost of equipment and tags, software, installation, maintenance, and training.
Test before you roll outIt is important to test the system in the actual operating environment before a full rollout. Testing with real products can reveal limitations and help refine the design before RFID is used in core business processes.
RFID and Automation
RFID can be part of an automation system. It can reduce manual data entry and send information from operational locations to relevant software.
Before the system takes the next step automatically, the organization should define the rules clearly. For example, should the data be checked against a document first? How should duplicate reads be handled? Who should review a mismatch?
Choose the Right RFID Approach and Connect It to ERP
RFID can read codes from tags attached to products and assets and may reduce manual data entry in some processes. When the codes are validated and connected to an ERP system such as Microsoft Dynamics 365 Business Central, they can support inventory management and related workflows.
A practical starting point is to identify the problem to solve, test the system with actual products in the intended environment, and plan how tags, readers, software, and ERP will work together.
Planning to connect RFID with your ERP system?
Contact AVISION to discuss ERP and ways to connect operational data with your business management system.
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