Question

A Wall Street Journal article reports on Delta's recent investment in luggage tracking, switching to baggage tags with radio-frequency ID chips embedded. This will allow the airline to accurately track customers' baggage in real time. Even though the new technology costs a great deal, Delta could save on fewer luggage claims and deliveries. What does this example imply?

Answer 1

Delta's investment in luggage tracking with radio-frequency ID chips can result in cost savings for the airline. The technology allows for accurate real-time tracking of baggage, reducing the number of luggage claims and deliveries. Additionally, proactive response to potential issues improves customer satisfaction and lowers the costs of complaint resolution.

Step-by-step explanation:

The example of Delta's investment in luggage tracking with radio-frequency ID chips implies that implementing new technology can result in cost savings for businesses. By accurately tracking customers' baggage in real time, Delta can reduce the number of luggage claims and deliveries, ultimately saving money. While the initial cost of the technology might be high, the long-term benefits outweigh the expenses.

For example, by using the new baggage tags, Delta can prevent the loss or mishandling of luggage, which would lead to fewer claims and the need for subsequent airlines to deliver or compensate customers. This reduces the overall cost of providing baggage services for Delta.

Furthermore, real-time tracking allows Delta to proactively respond to any potential issues with customer baggage, such as delays or misrouting. By addressing these problems promptly, the airline can enhance customer satisfaction and reduce the costs associated with resolving complaints or providing compensation.