Simulation-Based Evaluation of the Total Cost of RFID Absorption in a Manufacturing Firm

In this study, we extend an existing System Dynamics model of Radio Frequency Identification (RFID) technology absorption in an automotive manufacturing firm to evaluate the total costs of such an initiative as a function of leverage variables. RFID technology has been in existence for a while and has matured sufficiently to be affordable. The aim of this particular study is to not only evaluate total costs but to find the values of the leverage variables that minimize the cost. The larger objective is to create a choice framework for technology managers to assist with technology adoption and make informed technology investment decisions.