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RFID Benefits; Looking Beyond ROI

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MBA professional rept.

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This MBA project seeks to explore whether benefits are received from implementing Radio Frequency Identification RFID into the logistics process that are not captured by traditional Return on Investment ROI analysis. The authors seek to identify some of these benefits to determine their overall contribution to the value of new technology implementation. Their research question evolves from the premise that the ROI in the Department of Defense DoD is based on costs, with no reference to benefits. In non-profit organizations there are no direct profits to be measured from implementing new technologies. Without profits the revenues i.e., benefits side of the ROI equation is often ignored. By identifying benefits received in excess of the cost savings they hope to introduce the idea that the traditional ROI has blind spots when used in non-profit organizations. They utilize data from participants in the Naval Supply Systems Command NAVSUP Radio Frequency Identification RFID programs. The limited quantity of data makes any finding statistically unsupportable, but nonetheless starts to provide an interpretive perspective that expands beyond the traditional bottom line. All of the participants reported benefits of increased customer knowledge and increased timeliness of information. While this finding is not enough to implement new technologies, it supports the idea that new technologies have real benefits. The paper is therefore intended as a tool to be used by the Navy in addressing the idea that traditional ROI does not capture these intangible benefits. The authors contend that further study of this important issue is needed.

Subject Categories:

  • Administration and Management
  • Economics and Cost Analysis
  • Logistics, Military Facilities and Supplies

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