The Determinants of RFID Adoption in the Logistics Industry - A Supply Chain Management Perspective

Abstract

Despite the literature exploring the factors of adopting information technology (IT) applications for the logistics industry, Radio Frequency Identification (RFID) is still considered an innovative technology, because of its unique characteristics compared with other IT applications. To avoid the negative effects derived from careless IT investments, companies in Taiwan’s logistics industry must evaluate the factors that could affect the adoption of RFID prior to its introduction. This research employed encoding and utilized a questionnaire survey with the aim of assessing the factors that affect the adoption of this technology within the industry. Based on the results of discriminant analysis and verification, this investigation found that competition in the marketplace, pressure of transaction partners, suppliers’ industry environment, cost, integration of supply chain strategy, complexity of RFID, and mutual standard were among the critical factors. This research anticipates these factors as crucial and beneficial for the initial introduction phase of RFID adoption.