Information Systems Adoption among SMEs in Developing Country: The Case of Gerbang Kertasusila
Keywords:
Information Systems Adoption, Small Medium Enterprise, TAM, TOE,Abstract
The rapid growth of Internet Technology (IT) in Indonesia opens up many new business process innovations for small and medium enterprises (SMEs). Observing the cost of acquisitioning IT has become more affordable now compared to ten years ago, more and more SMEs convinced to implementing it. However, the success rate has been anecdotal. Various studies in the field of SMEs have been done, but not much focusing on how SMEs are adopting Integrated Information Systems. Specifically, in Gerbang Kertasusila (Industrial part of East Java, Indonesia), most of SMEs are trying to automate their business processes, however not many realize that in terms of IT adoption context, SMEs are not just merely a simple scaleddown model of large firms, hence many project implementations in SMEs were failing. This study combines T-O-E and TAM framework to analyses the important antecedents of technology adoption at the firm level. The collected data of 398 SME owners or managers were tabulated and analyzed using structural equation modelling to measure the causal effects. Result findings from final model confirmed the significance of Competitive Pressure (CP) and Owner’s ICT Knowledge and Innovativeness (OIKI) as the largest predictor of Intention to Adopt IT for business process automation. Despite solid theoretical contribution of the findings, this study also offers practical means of increasing the success rate of IT adoption by SMEs.References
A. Rahmana, “Peranan Teknologi Informasi Dalam Peningkatan Daya Saing Usaha Kecil Menengah,” in Seminar Nasional Aplikasi Teknologi Informasi 2009 (SNATI 2009), 2009, pp. 11–15.
S. Kurnia, J. Choudrie, R. M. Mahbubur, and B. Alzagooul, “Ecommerce technology adoption: A Malaysian grocery SME retail sector study,” J. Bus. Res., vol. 68, no. 9, pp. 1906–1918, 2013.
S. M. Lee and S.-H. Lee, “Success factors of open-source enterprise information systems development,” Ind. Manag. Data Syst., vol. 112, no. 7, pp. 1065–1084, 2012.
H. T. T. Tran, “Challenges of Small and Medium-Sized Enterprises (SMEs) In Vietnam during the Process of Integration into the ASEAN Economic Community (AEC),” Int. J. Account. Financ. Report., vol. 5, no. 2, p. 133, 2015.
A. S. Saleh and N. O. Ndubisi, “SME Development in Malaysia : Domestic and Global Challenges,” 2006.
M. Ghobakhloo and S. H. Tang, “Information system success among manufacturing SMEs: case of developing countries,” Inf. Technol. Dev., vol. 1102, no. January, pp. 1–28, 2015.
L. G. Tornatzky and M. Fleischer, The Processes of Technological Innovation. Lexington, MA: Lexington Books, 1990.
K. Zhu, K. L. Kraemer, S. Xu, and J. Dedrick, “Information Technology Payoff in E-Business Environments : An International Perspective on Value Creation of E-Business in the Financial Services Industry,” J. Manag. Inf. Syst., vol. 21, no. 1, pp. 17–54, 2004.
K. Zhu and K. L. Kraemer, “Post-Adoption Variations in Usage and Value of E-Business by Organizations : Cross-Country Evidence from the Retail Industry,” Inf. Syst. Res., vol. 16, no. 1, pp. 61–84, 2005.
M. Ghobakhloo, D. Arias-Aranda, and J. Benitez-Amado, “Adoption of e-commerce applications in SMEs,” Ind. Manag. Data Syst., vol. 111, no. 8, pp. 1238–1269, 2011.
H. Gangwar, H. Date, and A. D. Raoot, “Review on IT adoption: insights from recent technologies,” J. Enterp. Inf. Manag., vol. 27, no. 4, pp. 488–502, 2014.
V. Venkatesh and F. D. Davis, “A Theoretical Extension of the Technology Acceptance Model: Four Longitudinal Field Studies,” Manage. Sci., vol. 46, no. 2, pp. 186–204, 2000.
C. W. Autry, S. J. Grawe, P. J. Daugherty, and R. G. Richey, “The effects of technological turbulence and breadth on supply chain technology acceptance and adoption,” J. Oper. Manag., vol. 28, no. 6, pp. 522–536, 2010.
S. Hong, J. Y. L. Thong, and K. Y. Tam, “Understanding continued information technology usage behavior: A comparison of three models in the context of mobile internet,” Decis. Support Syst., vol. 42, no. 3, pp. 1819–1834, 2006.
P. F. Wu, “A Mixed Methods Approach to Technology Acceptance Research,” J. Assoc. Inf. Syst., vol. 13, no. 3, pp. 172–187, 2012.
H. Gangwar, H. Date, and R. Ramaswamy, “Understanding determinants of cloud computing adoption using an integrated TAMTOE model,” J. Enterp. Inf. Manag., vol. 28, no. 1, pp. 107–130, 2015.
H. O. Awa, O. Ukoha, O. Bartholomew, and C. Emecheta, “Integrating TAM, TPB and TOE frameworks and expanding their characteristic constructs for e-commerce adoption by SMEs,” J. Sci. Technol. Policy Manag., vol. 6, no. 1, pp. 76–94, 2015.
J. M. Pearson and E. E. Grandon, “An Empirical Study of Factors That Influence E-Commerce Adoption / Non-Adoption in Small and Medium Sized Businesses,” J. Internet Commer., vol. 4, no. 4, pp. 1– 21, 2005.
F. D. Davis, “Perceived Usefulness, Perceived Ease of Use, and User Acceptance of Information Technology,” MIS Q., no. September, pp. 319–340, 1989.
F. J. Martínez-López, I. Esteban-Millat, C. C. Cabal, and C. Gengler, “Psychological factors explaining consumer adoption of an e-vendor’s recommender,” Ind. Manag. Data Syst., vol. 115, no. 2, pp. 284–310, 2015.
K. Zhu and K. L. Kraemer, “Post-Adoption Variations in Usage and Value of E-Business by Organizations: Cross-Country Evidence from the Retail Industry,” Inf. Syst. Res., vol. 16, no. 1, pp. 61–84, Mar. 2005.
R. B. Kline, Principles and Practice of Structural Equation Modeling, 3rd Ed. New York: The Guilford Press, 2011.
U. Sekaran and R. J. Bougie, Research Methods For Business: A Skill Building Approach, 7th ed. Chichester, West Sussex, UK: Wiley, 2016.
D. J. Kim, D. L. Ferrin, and H. R. Rao, “A trust-based consumer decision-making model in electronic commerce: The role of trust, perceived risk, and their antecedents,” Decis. Support Syst., vol. 44, no. 2, pp. 544–564, 2008.
D. Gefen, E. Karahanna, and D. Straub, “Trust and TAM in Online Shopping: An Integrated Model,” MIS Q., vol. 27, no. 1, pp. 51–90, 2003.
A. Alalwan, Y. Dwivedi, N. Rana, and M. Williams, “Consumer adoption of mobile banking in Jordan Examining the role of usefulness, ease of use, perceived risk and self-efficacy,” J. Enterp. Inf. Manag., vol. 29, no. 5, pp. 118–139, 2016.
T. Zhou, “An empirical examination of initial trust in mobile banking,” Internet Res., vol. 21, no. 5, pp. 527–540, 2011.
J. Y. L. Thong and C.-S. Yap, “Information Systems Effectiveness: A User Satisfaction Approach,” Inf. Process. Manag., vol. 32, no. 5, pp. 601–610, 1996.
N. A. Y. Al-Qirim, “The adoption of eCommerce communications and applications technologies in small businesses in New Zealand,” Electron. Commer. Res. Appl., vol. 6, no. 4, pp. 462–473, 2007.
S. K. Lippert and C. Govindarajulu, “Technological, Organizational, and Environmental Antecedents to Web Service Adoption,” Commun. IIMA, vol. 6, no. 1, pp. 146–158, 2006.
K. K. Y. Kuan and P. Y. K. Chau, “A perception-based model for EDI adoption in small businesses using a technology–organization– environment framework,” Inf. Manag., vol. 38, no. 8, pp. 507–521, Oct. 2001.
P. K. Senyo, J. Effah, and E. Addae, “Preliminary insight into cloud computing adoption in a developing country,” J. Enterp. Inf. Manag., vol. 29, no. 4, pp. 505–524, 2016.
J. Cohen, Statistical power analysis for the behavioral sciences, 2nd ed. New York: Academic Press, 1988.
R. B. Kline, Principles and Practice of Structural Equation Modeling, 2nd ed. New York: The Guilford Press, 2005.
R. Stockdale and C. Standing, “Benefits and barriers of electronic marketplace participation: an SME perspective,” J. Enterp. Inf. Manag., vol. 17, no. 4, pp. 301–311, 2004.
Downloads
Published
How to Cite
Issue
Section
License
TRANSFER OF COPYRIGHT AGREEMENT
The manuscript is herewith submitted for publication in the Journal of Telecommunication, Electronic and Computer Engineering (JTEC). It has not been published before, and it is not under consideration for publication in any other journals. It contains no material that is scandalous, obscene, libelous or otherwise contrary to law. When the manuscript is accepted for publication, I, as the author, hereby agree to transfer to JTEC, all rights including those pertaining to electronic forms and transmissions, under existing copyright laws, except for the following, which the author(s) specifically retain(s):
- All proprietary right other than copyright, such as patent rights
- The right to make further copies of all or part of the published article for my use in classroom teaching
- The right to reuse all or part of this manuscript in a compilation of my own works or in a textbook of which I am the author; and
- The right to make copies of the published work for internal distribution within the institution that employs me
I agree that copies made under these circumstances will continue to carry the copyright notice that appears in the original published work. I agree to inform my co-authors, if any, of the above terms. I certify that I have obtained written permission for the use of text, tables, and/or illustrations from any copyrighted source(s), and I agree to supply such written permission(s) to JTEC upon request.