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Unpacking the RFID investment decision


  • Keating, Byron W.
  • Coltman, Tim
  • Fosso-Wamba, Samuel
  • Baker, Valerie


Mandates aside, there are many reasons why firms decide to move forward with or delay investment in RFID technology. In this paper we use a theoretically based, easy to implement methodology to empirically derive a relative importance scale of those factors that influence the decision to invest in RFID technology. More specifically, we compare the factors that matter most and least to a sample of firms that have adopted RFID technology with a sample of firms that have yet to embrace RFID technology. The theoretical and practical implications are that both RFID adopters and non adopters are driven by the promise of greater data accuracy, improved information visibility, service quality, process innovation, and track and trace capabilities. What separates the adopters from the non adopters is an opportunity to derive strategic benefits from RFID through improved decision making. Not surprisingly, the non adopting firms are primarily concerned with the high acquisition and other ongoing costs associated with RFID technology.

Suggested Citation

  • Keating, Byron W. & Coltman, Tim & Fosso-Wamba, Samuel & Baker, Valerie, 2009. "Unpacking the RFID investment decision," MPRA Paper 40507, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:40507

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    References listed on IDEAS

    1. Peter J Buckley & Timothy M Devinney & Jordan J Louviere, 2007. "Do managers behave the way theory suggests? A choice-theoretic examination of foreign direct investment location decision-making," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 38(7), pages 1069-1094, December.
    2. Fosso Wamba, Samuel & Lefebvre, Louis A. & Bendavid, Ygal & Lefebvre, √Člisabeth, 2008. "Exploring the impact of RFID technology and the EPC network on mobile B2B eCommerce: A case study in the retail industry," International Journal of Production Economics, Elsevier, vol. 112(2), pages 614-629, April.
    3. Srivastava, Bharatendu, 2004. "Radio frequency ID technology: The next revolution in SCM," Business Horizons, Elsevier, vol. 47(6), pages 60-68.
    4. Bottani, Eleonora & Rizzi, Antonio, 2008. "Economical assessment of the impact of RFID technology and EPC system on the fast-moving consumer goods supply chain," International Journal of Production Economics, Elsevier, vol. 112(2), pages 548-569, April.
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    More about this item


    Radio frequency identification; RFID; technology adoption; information technology; innovation;

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology


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