As 16S rDNA sequencing is considered as the common method now used for bacterial identification. Is there any relevance in biochemical tests for identification process.
It depends on how much resolution you need. 16S rDNA identification works well up to the genus level, but beyond, risks of misinterpretation arise. The problem is that 16S rDNA identification is not always representative of DNA relatedness, which may lead to false positive identification at the species level.
Here attached is an example of this, where two Bacillus spp. are mistakenly identified as from the same species based on 99,5% 16s rDNA sequence identity: However, their DNA relatedness is evaluated to less than 50% based on DNA:DNA hybridization results.
Moreover, biochemical tests can be used to validate 16S identification of environmental isolates (E.g.: If I identify an unknown isolate as Aeromonas salmonicida with 16S rDNA ID, I expect the bacteria to be facultative anaerobes, to degrade ONPG, to produce acid from l-Arabinose, glycerol, mannose, etc....)
Biochemical reactions can also be used for strain typing, as many strains from a same species do not share all the same biochemical characteristics.
But in the end, it depends of the needed resolution.
Article How Close Is Close: 16S rRNA Sequence Identity May Not Be Su...
Biochemical tests are still handy in identifying routine pathogens in teaching hospital set ups.
Automation (Vitek, MALDI-TOF) has already replaced the routine biochemical characterisation in corporate hospitals even in developing countries.
PCR based identification (specific gene or 16S rRNA) is done when we have unknown bacteria (environmental Microbiology) or for diagnostic purpose from human clinical samples.
Bacterial identification (like the identification of any other group of organisms) is based on fixed classification schemes. These schemes are based on a set of characters that differentiate between groups of organisms. These schemes are hierarchical and allow researchers to bin an organism at different taxonomic levels from broaders ones like phylum, class etc. to all the way up to genus or species. As Jeff pointed out, your question of relevance depends on the resolution you seek. 16S rRNA is a convenient proxy that in most cases agrees with traditional schemes of classification based on morphology or physiology. Combining it with PCR turns this proxy into an efficient taxonomic marker, significantly bringing down turnaround time and also the amount of sample required for identification. And indeed, extending the amplified region to include neighbouring ITS regions or indeed regions of the 5S and 23S rRNA gene could in fact be used to increase the amount of taxonomic resolution.
The work cited by Jeff is a classic example of lack of taxonomic resolution in 16S rRNA (in some groups). Additionally, 16S rRNA might not allow you to distinguish between the harmless E. coli K-12 and EHEC, for instance, because the phenotypic differences between the two strains are not accurately represented in their 16S rRNA sequences. For such reasons, hospitals and pathologists still use phenotypic tests for a more accurate assessment of the potential damage that could be caused by the organism.