Understanding the determinants of RFID adoption in the manufacturing industry

Radio frequency identification (RFID) is one of the most promising technological innovations, with the potential to increase supply chain visibility and improve process efficiency. It allows remote identification of an object using a radio link. However, it has yet to see high rates of adoption in the manufacturing industry. Thus, effort is required to identify determinants affecting RFID adoption in the manufacturing industry. Based on the technology-organization-environment (TOE) framework of Tornatzky and Fleischer (L.G. Tornatzky, M. Fleischer, The processes of technological innovation, Lexington Books, 1990), nine variables (relative advantage, compatibility, complexity, top management support, firm size, technology competence, information intensity, competitive pressure, and trading partner pressure) are proposed to help predict RFID adoption. Data collected from 133 manufacturers in Taiwan is tested against the proposed research model using logistic regression. The results and implications included in our study contribute to an expanded understanding of the determinants that affect RFID adoption in the manufacturing industry.