Testing the Potential of RFID to Increase Supply-Chain Agility and to Mitigate the Bullwhip Effect

International Journal of Applied Logistics (IJAL), Forthcoming

36 Pages Posted: 1 Sep 2009

See all articles by Anthony Vance

Anthony Vance

Brigham Young University - Department of Information Systems

Paul Benjamin Lowry

Virginia Tech - Pamplin College of Business

Jeffrey A. Ogden

Government of the United States of America - Institute of Technology

Date Written: August 30, 2009

Abstract

This study examines the potential of RFID technology to increase the agility of supply-chain e-commerce systems by mitigating the bullwhip effect. The bullwhip effect is a supply-chain phenomenon that reveals a lack of business agility characterized by the amplification of inventory variance. This study employs an experiment involving a modified Beer Distribution Game to simulate an RFID-enabled supply chain. The results provide empirical evidence that RFID technology can increase a supply chain’s agility and reduce the bullwhip effect by reducing inventory holding costs, stockout costs, and inventory-level variances. The results are all the more important when applied to interorganizational e-commerce systems.

Keywords: RFID, supply-chain agility, bullwhip effect, beer distribution game, e-commerce, interorganizational systems, information systems

Suggested Citation

Vance, Anthony and Lowry, Paul Benjamin and Ogden, Jeffrey A., Testing the Potential of RFID to Increase Supply-Chain Agility and to Mitigate the Bullwhip Effect (August 30, 2009). International Journal of Applied Logistics (IJAL), Forthcoming, Available at SSRN: https://ssrn.com/abstract=1464527

Anthony Vance

Brigham Young University - Department of Information Systems ( email )

510 Tanner Building
Marriott School
Provo, UT 84602
United States

Paul Benjamin Lowry (Contact Author)

Virginia Tech - Pamplin College of Business ( email )

1016 Pamplin Hall
Blacksburg, VA 24061
United States

Jeffrey A. Ogden

Government of the United States of America - Institute of Technology ( email )

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