An investment evaluation of supply chain RFID.docVIP

An investment evaluation of supply chain RFID technologies: A normative modeling approach In Leea, , and Byoung-Chan Leeb, a Department of Information Systems and Decision Sciences, College of Business and Technology, Western Illinois University, Stipes Hall 431, Macomb, IL 61455, USA b Department of Business Administration, Graduate School, Keimyung University, Taegu, South Korea Received 24 April 2009;? accepted 13 February 2010.? Available online 18 February 2010. Abstract As Radio Frequency Identification RFID technology advances rapidly and major retailers start to push their suppliers to adopt the technology, RFID cost–benefit analysis has become a subject of great focus. RFID complements or replaces barcode systems and traditional manual tracking systems to identify, retrieve, track, and store merchandise automatically. The adoption of this technology is gaining momentum rapidly as technological, societal, and competitive pressures push firms to transform and innovate themselves. Because of the potential benefits gained and high investment costs incurred by RFID, firms need to carefully assess every RFID opportunity and challenge to ensure that their resources are spent judiciously. This paper presents the Supply Chain RFID Investment Evaluation Model, and provides a basis for enhancing our understanding of RFID value creation, measurement, and ways to maximize the value of RFID technology. A future research direction is also discussed. Keywords: RFID; Supply chain; Investment Article Outline 1. Introduction 2. Literature review 2.1. Supply chain RFID 2.2. RFID valuation methods 3. The Supply Chain RFID Investment Evaluation Model 3.1. RFID investment in the ordering efficiency 3.1.1. The minimum demand level for RFID investment in the ordering efficiency 3.2. RFID investment in the JIT efficiency 3.2.1. The minimum demand level for RFID investment in the JIT efficiency 3.3. RFID investment in the operating efficiency 3.3.1. The minimum demand l