Airlines’ plight: where has all the luggage gone?

Purpose - The purpose of this paper is to test the use of radio frequency identification (RFID) for improving track and trace of the luggage handling process and to determine potential decreases in operational costs of airports, namely through reduced baggage sorting expenses. Design/methodology/approach - An experiment was designed to test the feasibility of implementing a RFID‐based tracking system and to determine the practicality and the technical hurdles which must be addressed. Findings - RFID‐optimized airline value chains can improve efficiencies through adaptive load planning, whereby luggage can be loaded onto aircraft based on final destination and reduce manual sorting. Research limitations/implications - The experiment was tested in a small regional airport. Practical implications - RFID allows for synchronous communication through the value chain, enabling airlines to proactively determine if departing aircraft contain the appropriately checked luggage. Originality/value - As customers become more price elastic, the firm must improve its abilities to meet the travel flexibility requirement and provide value added services to customers. RFID can expedite value chains by removing human induced variability and manual sorting, while improving accuracy and providing a heightened awareness of the logistics system.