RFID in the healthcare supply chain: usage and application

Abstract

Purpose: The purposes of this study are to first, determine the most efficient and cost effective portions of the healthcare supply chain in which radio frequency identification devices (RFID) can be implemented. Second, provide specific examples of RFID implementation and show how these business applications will add to the effectiveness of the healthcare supply chain. And third, to describe the current state of RFID technology and to give practical information for managers in the healthcare sector to make sound decisions about the possible implementation of RFID technology within their organizations.

Design/methodology/approach: Healthcare industry literature was reviewed and examples of specific instances of RFID implementation were examined using an integrated simulation model developed with Excel, @Risk and Visio software tools.

Findings: Analysis showed that the cost of implementing current RFID technology is too expensive for broad and sweeping implementation within the healthcare sector at this time. However, several example applications have been identified in which this technology can be effectively leveraged in a cost-effective way.

Practical implications: This study shows that RFID technology has come a long way in the recent past and has potential to improve healthcare sector productivity and efficiency. Implementation by large companies such as Wal-mart has helped to make the technology become much more economical in its per unit cost as well as its supporting equipment and training costs.

Originality/value: The originality of this study lies in the idea that few practical and pragmatic approaches have been taken within the academic field of study for the implementation of RFID into the healthcare supply chain. Much of the research has focused on specific companies or portions of the supply chain and not the entire supply chain. Also, many of the papers have discussed the future of the supply chain that is heavily dependent on advances in RFID technology. A few viable applications of how RFID technology can be implemented in the healthcare supply chain are presented and how the current state of technology limits the broad use and implementation of this technology in the healthcare industry.