NFC IMPLEMENTATION TO IMPROVE BUSINESS PROCESS
Marisa Karsen
Information Systems Department, School of Information Systems, Binus University Jl. K.H. Syahdan No. 9, Palmerah, Jakarta Barat 11480
marisa_karsen@binus.ac.id
ABSTRACT
Every industry needs IT to improve their business and give faster service to customer. The fast growing of social network (Facebook, Twitter, MySpace, LinkedIn) and Smartphone (Blackberry and iPhone) in Indonesia indicate that Indonesian people are already familiar with high technology and it is the right time to introduce new technology in Indonesia. The problem is, the usage of IT-based system in Indonesia is not optimal. Nowadays, people want to do almost everything faster and more convenient using technology. We know that until now, there are a lot of situations that make people queue or wait to get their need. In this kind of situation, we need something that will change the way to do business, that is in effective and efficient way. NFC (Near Field Communication) is considered suitable as the solution. NFC technology as one of payment systems can increase competitive advantage of the company which implements it and will make it a leader in the industry. This new technology could attract customers, especially Indonesian people in big cities who want to do their transaction in quick and efficient way. NFC is already implemented in Korea and USA as substitution of e-wallet that can help people to make transactions easier and faster. I believe NFC can be implemented in Indonesia to make new trend of doing business.
Keywords: new technology, business, payment system, NFC (Near Field Communication)
ABSTRAK
Setiap industri membutuhkan TI untuk meningkatkan bisnis mereka dan memberikan layanan yang lebih cepat kepada pelanggan. Pesatnya perkembangan jejaring sosial (Facebook, Twitter, MySpace, LinkedIn) dan Smartphone (Blackberry dan iPhone) di Indonesia menunjukkan bahwa masyarakat Indonesia sudah akrab dengan teknologi tinggi dan ini adalah waktu yang tepat untuk memperkenalkan teknologi baru di Indonesia. Masalahnya adalah, penggunaan sistem berbasis TI di Indonesia belum optimal. Saat ini, orang ingin melakukan segala sesuatu lebih cepat dan lebih nyaman menggunakan teknologi. Kita tahu bahwa sampai saat ini, ada banyak situasi yang membuat orang mengantri atau menunggu untuk mendapatkan kebutuhan mereka. Dalam situasi seperti ini, kita perlu sesuatu yang dapat mengubah cara untuk melakukan bisnis, yaitu dengan efektif dan efisien. NFC (Near Field Communication) dianggap cocok sebagai solusinya. Teknologi NFC sebagai salah satu sistem pembayaran dapat meningkatkan keunggulan kompetitif perusahaan yang mengimplementasikannya dan akan membuatnya lebih unggul. Teknologi baru ini bisa menarik pelanggan, terutama orang-orang Indonesia di kota-kota besar yang ingin melakukan transaksi dengan cepat dan efisien. NFC sudah diimplementasikan di Korea dan Amerika Serikat sebagai pengganti e-wallet yang dapat membuat transaksi lebih mudah dan lebih cepat. Saya percaya NFC dapat diimplementasikan di Indonesia untuk membuat tren baru dalam berbisnis.
1044 ComTech Vol.4 No. 2 Desember 2013: 1043-1054
INTRODUCTION
People need technology for doing business. Business needs innovation to create competitive advantage and innovation itself is important, as it does not only influence at the level of the individual enterprise but also increasingly as the well spring for national economic growth (Tidd and Bessant, 2009).
Information Technology is all forms of technology used to create, store, exchange, and use information (Pearson & Saunders, Strategic Management Information Systems, 2009, p. 16) and has important role in our business. Every company needs IT to run their business and IT has made a significant contribution to economic growth and quality of life. Almost in every industry, transaction might not be done smoothly without IT. Further than that, companies that want to focused in their core business, tend to use IT system provider to help them make IT innovation to attract customer, because IT system provider is expert in IT business. Some companies also buy ready IT program, such as Oracle, SAP, etc.
Nowadays, people are aware and always waiting for new technology. We can see if a new or different technology appears, people are willing to try it. So, if we come out with new idea using new technology, we believe we can penetrate the market. In other countries, such as USA and Korea, there is new technology for doing daily life transaction, which is Near Field Communication (NFC).
Near Field Communication (NFC) is a short range wireless technology compatible with contactless smart cards (ISO/IEC 14443) and radiofrequency identification (RFID). NFC is on the 13.56 MHz frequency band and operates at a distance of less than 4 cm. It uses magnetic field induction for communication and powering the chip (Muhammad Qasim Saeed, Colin D. Walter, 2012).
NFC harmonizes today's diverse contactless technologies, enabling current and future solutions in areas, such as Access Control, Consumer Electronics, Healthcare, Information Collection and exchange, Loyalty and Coupons, Payments, Transports, Other Possibilities (NFC Forum, 2013).
NFC is a technology that could build communication between your Smartphone and NFC chip without touching the object, such as reader, touch screen, poster, restaurant menu, etc. We see that a lot of in many kind industries (theater, restaurant, bank, amusement park, etc), and we think how to make it efficient. Using NFC technology, people can do transaction in efficient way without queuing in front of the cashier.
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Figure
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studying IT ed NFC tech conducting m naire, we can
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research is he way of do
doing busin ss in the mo on in Indone n in Indones
METHOD
T industry in hnology. It market resea n analyze the
ure 2 Methodo
t in 2012 (ww
s to analyze oing busines ness transacti ost effective esia. In this p
ia to improv
D
n other deve is followed arch by ques e opportuniti
ology
ww.inmobi.com
e the oppor ss. This pap ion using NF
and efficien paper, we onl ve the way o
loped count by studyin stionnaire to ies about NF
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rtunities abo per has the f
FC technolog nt way; (2) to ly focus on a of doing busi
try such as U ng about IT o know abou FC implemen
out NFC following gy for the o provide analyzing iness and
1046 ComTech Vol.4 No. 2 Desember 2013: 1043-1054
Observation of IT Industry Development
First step to do this research is observation of IT Industry Development in other country and in Indonesia. In this case, the observation is scoped in any kind of Readers technology that support to doing business, such as barcode, RFID, QR Code, and NFC. Having data collected, I make comparison about the technologies and find that NFC is the best way to help doing business in effective and efficient way (Tabel 1).
Table 1 Comparison Technology of Readers
Conducting Market Survey about NFC Technology
Finding that NFC is the best way compared to another Readers technology, I conduct market survey by questionnaire to know about people opinion about NFC technology and the possibility to implement NFC technology in Indonesia.
Literature Study
During the survey, I collect theories about information system and NFC technology to know ideal condition about NFC technology implementation. I obtain the theories from book, internet, and other media which related to the scoped of works.
Collecting Data
Obtaining responses from 100 respondents about IT development and NFC technology implementation possibility, I make questionnaire recapitulation to know about whole respondents’ opinion.
Finding Possible Opportunities about NFC Implementation in Indonesia
Identifying the respondents’ opinion of NFC technology implementation in Indonesia, I try to figure out about possible opportunities about NFC implementation in Indonesia and create Porter Five Forces analysis and business model.
No Categories NFC Barcode RFID QR Code
1 Mobility NFC Tag Printable
code
RFID Tag Printable code
2 Transfer Speed Fast
Reading (2 second)
Slow Reading
Fast Reading (2-3 second)
Slow Reading
3 Transfer data Yes No No No
4 Interaction Two way One Way One Way One Way
5 Security
(1-4) *Low-High
4 1 3 2
6 Reader Smartphone
& Reader Machine
Smartphone & Reader
Machine
Reader Machine
Reader Machine
7 Error on read Low High Medium High
Conclus
H conclusi give mor
Marke
W
sion and Rec
Having some on and recom re understand
et Survey o
We offer que
commendati
e analysis ab mmendation ding about th
R
of NFC Te
estionnaire to
ion
bout the pos which repre he goals and
RESULTS
echnology
o 100 respon
Figure
sibility of N esent the who
ensure the a
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SCUSSION
his is the reca
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ut NFC techno
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w technolog roviders yet, vestors do no
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Whellen, Da
logy is gro ompetitors th
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s process ma n any kind ate customers ill surely cre egment.
ComT on about NFC
nalysis whic tool, SWOT ngths,Weakn
nities and th ngths and w
avid J. Hunge
owing so fa hat offer the
mpany implem C technology ket. Create N aware in tec
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ake more eff of industrie s needs. eate Blue Oc
Tech Vol.4 N implementati
h is analyze T Analysis. T nesses, Oppo
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er, 2008).
ast. When o same or bett
ment NFC te y implemente New Market
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cean Strategi
No. 2 Desem ion in Indones
from extern TOWS and rtunities and g a particula o result in f
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ber 2013: 10 sia
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043-1054 al. TOWS acronyms he TOWS n can be f possible nts NFC ss model, company will create oing their lly young s a good
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ooking. Ticke gain access t hone will sta ed and being o send a sign an be on item curity featur ge is the low
power sourc et al, 2012).
ess Process
NFC techno provider at a
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FC Implem
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Figure 9
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logy can be Merchant. A tion. After m ment confirm 10).
mentation
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ction with im r needs to do stablished an it is perfectly RFID access ar keys using
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now be store alidate the tic the user to NXP Tag W ails, URLs a p to posters. N
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mage display o is touching nd the image y feasible to s control syst g NFC are eveloped an already allow ed on the NF cket with the create their Writer for the
and SMS me NFC has a sh thorized com concers suc igure 9 belo
usage (Curran
g user’s smar will send sign tem will send ple about use
devices like g the photo f e is sent ove use an NFC tems as a rep being devel
NFC car ke ws for hotel FC card whic e conductor.
own NFC t e Android Sm essages onto
horter range mmunication ch as blueto ow show the
n,et al, 2012)
rtphone at N nal to Merch d signal to en er interface o
e digital phot frame with th er Bluetooth
enabled dev placement fo oped by BM ey system w
reservation, ch can then i Then applica tags. One ap martphone. I an NFC ena than RFID.
takes place. ooth, and als e general us
NFC reader p hant’s server nd users’ Sm of NFC on e
to frames he image h. NFC is vice as an or the key MW with which will and train in turn be ations for pplication It enables abled tag It gives a Another so works age of it
1052 A provides has coop H between banking, banking confirma account amount working
Benefit
B systems, office id that stor provides access t transacti addition sensitive prestige was still additiona payment payment system – life. Add M impleme their wo movie ti who che more un A company s services to peration withHere is the e customers, b , the system website and ation. If end
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t of NFC I
Benefit for , from comp dentification, ring informat s a safer env to all your ion. It is saf , NFC creat e information
– prestiges i l relatively u
al payment t method fo t, though pe – NFC poten ditionally, the
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that will im Merchants. I h bank.
example of p bank, and sy will request d verify e-ba d customers
ebit notificati and receive
Implement
end-users ar plex to a mo or even mem tion all in o vironment th credit cards fer also beca
es a secure n between yo is one of the unknown Th method – W or people tha
ople thinked ntial uses is r ere is no nee
the benef NFC technolo her workforc stored in vis ould be alloc
on customer
Figure 10.N
mplement NF It could mak
payment mec ystem provid
t to input e-b anking user
agree, the b ion to end cu e the top-up
tation
re: (1) ease ore daily task
mber cards o one place on han your phy , debit card ause you can
channel for our phone an top option f he first users With its leve at don`t wa d it was uns really big wh ed to change
fits for me ogy will simp ce. The most sitor’s smartp ated elsewhe rs’ behaviour ComT NFC Transacti FC technolo ke installation chanism usin der (Figure 1
banking user ID in 1x24 ank system ustomers. A p money aft
of use – thi k. NFC will of their store your smartp ysical wallet ds, and phot n have a pas communica nd othe devi for people to s will have el of securit nt to bring ecure, is sup hich may aff
user’s smart
erchants are plify workflo t obvious im tphone, and i ere; (2) value r – the data o
Tech Vol.4 N ion methods
gy in Indon n and mainte
ng myWallet 1). When en r ID. After t hour. Then will create d After that, sys
er end-of-da
is is the mo let user to n department; phone may b t. If your wa to Ids. NFC saword to pr ation and use
ce, such as c o buying thin the “privilag ty, NFC tec
their credit pposedly a fect people`s tphone since
e: (1) hum ow, so that c mplementatio is checked u e added syste of consumer
No. 2 Desem nesia needs S
enance about
t with top up d customers that, end cus the system direct debit stem provide ay settlemen
ost obvious t not carry mu ; (2) security be dangerou allet is stole C uses passw
rotect your s es data encry card reader ( ngs. In Indon ges” to brag chnology is card, debit secure servi way to do th it works wit
man resourc orporate mig on is in the m using a comp
em, such as d behaviour c
ber 2013: 10 System Prov t NFC system
p via internet want to top-stomers mus
will send tra from end cu er will receiv nt (it means
to use, as it ultiple cards y – some peo us. On contra
n, a thief ha word to prot smartphone u
yption when (Wozniaki, 2 nesia NFC te g to their fri used as a a t card, or ca
ices; (5) valu heir business th all platform
ces allocati ght be able to movie theate puter databas decreasing q ould be colle
043-1054 vider that m. It also
t banking -up via
t open e-ansaction ustomers’ ve top-up D+1 on
simplify , or their ople think ary, NFC as instant tect your usage. In n sending 2013); (3) chnology ends; (4) additional ash. This ue added s or daily ms.
analyized for further company usage.This condition will increase customer engagement because the Merchant actually know the customers’ behavior; (4) changing mindset – end users will consider the corporate users innovative. It will gain prestiges; (5) faster additional transaction method –the transaction system using NFC will serve as an additional payment services, with the advantages of faster transaction than common debit or credit cards do.
Figure 11 NFC payment mechanism using MyWallet
CONCLUSION
1054 ComTech Vol.4 No. 2 Desember 2013: 1043-1054 really confident and have indefinite trust that NFC technology implementation in Indonesia will be possible with condition that there is a system provider. We can start with NFC implementation for transactions first, but in the future, I recommend to implement NFC in many areas, such as transportation, advertising, office and entertainment. During technology development in Indonesia, we believe that NFC technology is feasible to be implemented because according to our market survey, most of Indonesian people, especially people of Jakarta kindly follow technology. Further, mostly Smartphone launched in 2011, such as Blackberry, Android, and Windows are already embedded with NFC inside (Computer World, 2012). This condition makes more possibility to implement this kind of business model in Indonesia.
REFERENCES
Computer World. (2012). Despite Apple, NFC is Catching on -- Just Not for Payments Quite Yet.
Accessed from ComputerWorld Web Site: http://www.computerworld.com/s/article/9234736/Despite_Apple_NFC_is_catching_on_just_
not_for_payments_quite_yet\
Curran, K., Millar, A. and McGarvey, C. (2012, April 24). Near Field Communication. International
Journal of Electrical and Computer Engineering (IJECE), 372.
NFC Forum. (2013). About NFC. Accessed from http://www.nfc-forum.org/aboutnfc/.
Pearson, K. E., & Saunders, C. S. (2009). Strategic Management Information Systems. Florida: John Willey & Sons, Inc.
Saeed, Muhammad Qasim and Walter ,Colin D. (2012, March/June). An attack on Signed NFC Records and Some necessary revisions of NFC Specifications. International Journal for
Information Security Research (IJISR), 2 (1), 325.
Tidd, Joe and Bessant, John (2009). Managing Innovation: Integrating Technological, Market and
Organicational Change. Chicester: John Wiley & Sons.
Whellen, Thomas L.and Hunger ,David J. (2008). Strategic Management and Business Policy :
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