Classification of RFID adoption: An expected benefits approach

Abstract

While expected benefits have been seen as one of the main drivers of RFID adoption, there is little understanding of what benefits should be considered when exploring RFID adoption. Further, the relationships between expected benefits and the type of adoption has not been systematically delineated. We identified cost savings, supply chain visibility, and new process creation as the three key benefits of RFID adoption and then identified the “scale” and “scope” of RFID implementation as the key dimensions of RFID adoption. Based on these, we proposed a four-category classification for the type of RFID adoption. Finally we showed how the three expected benefits are associated with the scale and scope of adoption. In particular, the findings highlighted the significant potential of RFID when it is integrated with other technologies such as global positioning or product life cycle management systems. Under various situations, a firm may perceive different benefits and value some benefits more than the others; this combination leads the firm to choose a certain type of RFID application. The model was validated using secondary case data from seven organizations that had adopted RFID.