A qualitative study of improving the operations strategy of logistics using radio frequency identification

Abstract

Purpose This study aims to investigate how radio frequency identification (RFID) is used and opinions about RFID in two world-leading logistics companies and four organisations in their supply network. Operations strategy was used to understand the sources of operations improvement and associated competitive advantage. However, the complexity of operations strategy hampers an evaluation of the benefits of RFID for logistics processes. We can evaluate RFID applied in logistics processes by thoroughly applying the theories of operations strategy. Design/methodology/approach Participants were recruited based on their roles and level of experience using non-probability purposive sampling. The findings were checked with participants to confirm interpretations and to ask confirming questions as necessary. Interviews were conducted as video chats. NVivo Pro was used for the fragmentation, classification, management and analysis of the primary and secondary data, allowing themes and relationships to emerge inductively. The literature was compared with the primary data. Findings The findings reinforce the argument that a firm can improve more than one performance objective at a time; show the relevance of technology and an operations performance objective; support the argument that top management strategies to implement technology should be aligned with the operations strategy and business aspirations. Research limitations/implications This research area would benefit from more detailed investigation to strengthen the arguments for the relationships between RFID capabilities and elements of operations strategy for logistics processes. The findings indicate that top management support of strategically aligned RFID projects will have the best chance of success if they create and leverage valuable data whilst addressing identified competitive priorities. Practical implications Smart connected devices, such as RFID, give firms access to big data, which can be used to develop long-term processes, to achieve competitive advantage and access new forms of economic value. RFID cumulatively influences the operations performance objectives of cost, quality, flexibility, speed, dependability and technology. Business strategies based on technology should align with operations strategy. Social implications The sharing of operational performance results, both before and after the implementation of RFID, will help to build learning within operations, increase the support of senior management and improve the performance of logistics processes with the associated benefits for society at large. Originality/value RFID is often evaluated in terms of theoretical technical or cost benefits. This research evaluates RFID by assessing and suggesting how it can contribute to operations strategy.

RFID refinement

“…Therefore, investment in either in-house systems or outsourced access to computing power is key to fully benefitting from RFID. The work of Flanagan and McGovern (2022) indicates that RFID adoption works well for various operations strategies. Those identified are an inside-out perspective, utilizing big data benefits, an outside-in perspective, benefitting from cumulative improvements on multiple performance objectives simultaneously, and a top-down perspective, which focuses on senior management levels directing adoption and communicating benefits to the lower levels of the organizations.…”

“…Real time remote visualization of supply chains and logistics networks are key drivers for supply chain innovation, and could transform the competitive landscape for logistics, supply chains, and buyers globally. As Flanagan and McGovern (2022) state, RFID technology allows the wireless transfer of data to and from tags attached to items and inventory, which allows for efficient and instant inventory management, item identification, asset management, and security control, and can improve item and inventory visibility, reduce cycle times, and eliminate errors. Yet RFID adoption has not been wholescale or widespread, despite the technology having been around for more than a decade.…”