Perceived Moderating Ability of Relational Interaction vs. Reciprocal Investments in Pursuing Exploitation vs. Exploration in RFID Supply Chains - Enterprise Information Systems Design, Implementation and Management: Organizational Applications - page 86

bAckground exploration. Though not at the expected speedy

rate of diffusion, RFID system implementation
initiatives are still a major consideration in im-
proving supply chains across industries.
The IT infrastructure and business process
support that should undergird RFID systems are
a great concern considering how supply chains
are getting more complex and more international
in their geographic scope (Simchi-Levi, Kamin-
sky, & Simchi-Levi, 2004). Firms that will be
using RFID systems to gain exploitation-related
goals seek to improve operational efficiencies,
streamline activities, and achieve greater control
over process execution. On the other hand, those
that seek exploration-related outcomes will use
RFID systems to find innovative ways of solving
problems and meeting challenges. The demands on
supply chain partners that will be participating in
these RFID initiatives will be significant enough
for these firms to consider using either relational
interaction routines or reciprocal investments in
ensuring the attainment of their goals. Reciprocal
investments are transaction-specific investments
made by supply chain trading partners in a busi-
ness exchange intended to cement the relationship
beyond what is ordinarily delivered by contractual
agreements. Relational interaction routines are a
combination of formal and informal mechanisms
used to facilitate the exchange of information and
knowledge between a focal firm and its trading
partners.
This study uses the moderated regression
procedure to test the ability of both reciprocal
investments and relational interaction to moder-
ate the relationship between the independent and
dependent variables using data gathered from 87
firms using an online survey.

Literature review

IT Infrastructure Integration Capability

IT infrastructure integration is defined as the
degree to which a focal firm has established IT
capabilities for the consistent and high-velocity
transfer of supply chain-related information within
and across its boundaries. This study closely looks
at the IT infrastructure integration requirements
needed to support the use of RFID within a sup-
ply chain context. The formative construct intro-
duced by Rai, Patnayakuni, and Seth (2006) was
adopted in this study and used both conceptually
and in the instrumentation as well. They define
IT infrastructure integration in terms of two sub-
constructs, data consistency and cross-functional
SCM application systems integration.
The extent to which data has been commonly
defined and stored in consistent form in databases
linked by supply chain business processes is re-
ferred to as data consistency (Rai, Patnayakuni, &
Seth, 2006). Data consistency is a key requirement
in creating a data architecture that defines the
structure of the data and the relationships among
data entities that is fundamental in establishing
interorganizational data sharing (Van Den Hoven,
2004). Simchi-Levi, Kaminsky, and Simchi-Levi
(2004) note that recently, many suppliers and re-
tailers observed that despite the lack of variation
in customer demand for products, inventory and
back-order levels vary, nevertheless, across many
supply chains, oddly enough. This observed vari-
ability up and down the supply chain is called the
“bullwhip effect” (Moyaux & Chaib-draa, 2007;
Simchi-Levi, Kaminsky, & Simchi-Levi, 2004).
Sharing consistent data upstream and downstream
in the supply chain is one major solution to over-
coming the bullwhip effect.
Data from legacy systems of supply chain
trading partners need to be accessed to produce
useful, integrated data, and to be able to transport