Understanding Technology Adoption through System Dynamics Approach: A Case Study of RFID Technology

Much research has been conducted to investigate innovation diffusion and technology adoption. For RFID adoption, there are relatively few studies. Most of the existing literature explores RFID adoption from the static factors perspective. However, RFID technology, as with other technology adoption, is not an activity limited to one organization. It has complex interactions and feedbacks between organizations, technology providers, and policy-makers. The RFID adoption process consists of a series of decisions and actions over time. The contribution of this study is to explore dynamic behavior of RFID adoption using system dynamics approach. Drawing upon Bass model, this study develops a three-phase (take-up phase, practice phase, and confirmation phase) RFID adoption model with decision delays. From system dynamic modeling and simulation, some critical insights are derived for policy-makings, which have important relevance especially for advocates of RFID technology.