Decision Making Process for New Technology Adoption: the Case of Rfid

Why are there many projects in some application areas and none in others? Why can you find in the same industry companies which have implemented new technologies and others which are just watching? The Italian Permanent Observatory on RFId, promoted by the School of Management of Politecnico di Milano has tackled a two-year research program, involving more than 300 companies with more than 500 business cases in Italy to understand the drivers of adoption of RFId Technologies. The analysis has involved companies which have implemented or not implemented an RFId project, and the different behavior observed seems to be explained by the biases which affect the Normative Model of Decision making. In other words, the traditional economic rational assessment is too limited for explaining the real behavior of decision makers. As a first factor, we have found that a limited knowledge of RFId technologies is one of the principal barriers to the adoption and development of RFId applications. Secondly, an high level of top management commitment is often crucial to begin the process of experimentation and knowledge building with the technology (thus activating a process that we have defined as virtuous cycle), and this commitment is still missing in many examined companies. Moreover, the perception of risk is strongly reduced by a very important player in the decision making process: the external expert which enables the decision, hence also this role has to be carefully acknowledged. Finally the lack of an industry or institutional commitment, in order to overcome some more systemic-barriers has been observed.All these factors have been included into a normative model, which is presented in this paper.