The Value to the Customer of RFID in Service Applications*

Abstract

This article examines how customer value may be affected by deploying radio frequency identification (RFID) technologies within service environments. Business articles promote operational cost savings and improved inventory management as key benefits of deploying RFID. In response, service firms are using RFID to reengineer service transactions and customer touchpoints. Customers may view these RFID applications to offer both benefits and drawbacks. This article demonstrates that individuals will recognize far more value from RFID service applications than just cost savings and inventory availability. The article analyzes qualitative survey responses on the value gained from RFID to identify a broad list of value objectives-benefits and drawbacks-associated with RFID service applications. The article contributes to academic literature by providing salient value dimensions for return on investment models of service RFID applications and for future empirical analyses of means-ends and value-profit chain models. Managers can use the list of dimensions to develop rich business cases for evaluating the benefits and costs from enhancing service operations with RFID. The identified drawbacks also provide managers with a resource for understanding potential risks of RFID applications.

Quantitative payoff evaluation for track and trace system in supply chains

“…A typical qualitative approach is doing survey. For this approach, the domain experts or practitioners are asked to subjectively give their best estimates by filling surveys [9], [10]. For instance, the track and trace index (a sub-index of Logistics Performance Index) provided by the World Bank which indicates the track and trace performance of different countries is generated from survey results [11].…”

Empirical Study of an Automated Inventory Management System With Bayesian Inference Algorithm

“…They are a transponder (tag), transceiver (reader), and the back-end database [11]. When the RFID tags move within the readable range of an RFID reader's radio field, each tag responds by reporting its identification data to the reader [13]. Then the transceiver reads the data and passes the data on to enterprise applications such as enterprise resource planning, customer relationship management, supply chain management systems, or other use in synchronization operations [14].…”

Radiofrequency Identification

“…11,19 Wal-Mart became an early adopter of RFID technology for inventory management and is credited as a key driver in its continued development. 9,19 In 2003, Wal-Mart required that suppliers deploy RFID tags to track product pallets, cases, and individual items. By 2006, nearly 300 Wal-Mart suppliers were providing tagged goods into their inventory system.…”

“…By 2006, nearly 300 Wal-Mart suppliers were providing tagged goods into their inventory system. 19 Radiofrequency identification has been heralded as one of the 10 greatest contributory technologies of the 21st century with global sales projected to increase from $4.96 billion in 2007 to over $26 billion by 2017. 9,10 …”