Evaluating Variance in Cost-Benefit Perceptions of RFID Systems in the Supply Chain Sector

Since the introduction of Radio Frequency Identification (RFID) systems, retailers such as Wal-Mart have pushed their suppliers for adoption. The Cost-Benefit justification for retailers is more direct and stronger than it is for other supply chain sectors, especially manufacturers, who bear the cost of affixing tags. Their cost-benefit scenario improves if the technology can be used to streamline the manufacturing process. Prior studies have noted this imbalance in the costs and benefits between Supply Chain entities, and even conducted case studies to examine specific industries. No studies were found to attempt to capture the comparative perceptions of the costs and benefits across the supply chain echelons. This paper therefore attempts to explore and understand the variance in perceived costs and benefits for the use of RFID systems by managers of organizations on different echelons of the supply chain. The study is based on 210 responses to a validated instrument used in prior research on novel information technology.