1084 Application of Web Services in the Context of E-Procurement deal with the integration puzzle in a cost-effec- tive way. With Web services crossing the chasm and gaining widespread acceptance over the next few years, we envision a world where a host of marketplaces and e-procurement solution vendors will be offering a suite of products based on Web VHUYLFHV0F.HUWLFKHPSKDVL]HVWKDW³H marketplace providers will be quick to see the opportunity, and modify their software technology to incorporate Web Services support so that they can continue to ‘build the bridges’ between buyers and sellers of disparate computing technology, and disparate business priorities.” Chen and Meixell (2003) asserts that compa- nies may soon participate in dynamic e-business via collaborative XML-based Web services that provide remote access to programmable business services and use XML for data interchange. CONCLUSION The above discussions clearly indicate that supply chain integration and information sharing are the key factors which will determine the success of any organization in the future ahead. E-procurement, due to its potential for savings and also because of its high importance in the supply chain, is an important area of focus for SMEs. Web services with its standards-based ap- proach are clearly the path SMEs should take in the integration of supply chain activities. Soon, innovative business strategies and business mod- els, as well as supply chain integration relying on Web service-based architecture, will become the driving force for XML and Web services adop- tion (Sullivan, 2002). The fact that Web services can be used internally to provide programmable interfaces to legacy systems, and to integrate Web-enabled applications directly with some legacy systems, make it an ideal choice for its adoption in supply chain context, especially in e-procurement which involves interaction with suppliers’ systems and vice versa (Samtani & Sadhwani, 2003; Vecchio, 2001). Apart from the solutions to barriers on the technical arena, for the widespread adoption of e-procurement among SMEs, a concerted effort needs to be made by the SME managers at the organizational level and by the regional and the national governments at the regional and the national levels, respectively. For example, in developed countries like the United Kingdom (UK), the national government has initiated an ambitious National E-Procurement Project (NEPP). As per the government mandate, all SMEs dealing with the local authorities should possess the ability to deal with them electronically by the end of 2005, and participation in an electronic marketplace would count as one of their criteria for evaluating a supplier. The challenges faced by SMEs in adopting e-procurement are more profound in developing countries. Therefore, the government in those countries needs to play an even more proactive role in enabling SMEs to harness the full potential of e-procurement. A noteworthy example in India is the state govern- ment of Andhra Pradesh. The government has been very proactive in the implementation of e-procurement technology. As of 1-1-2005, all departments of the state government have shifted towards e-procurement, which is an extraordinary achievement. This mandates that all suppliers to the government trade electronically. 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Agrahari, pp. 265-305, copyright 2007 by IGI Publishing (an imprint of IGI Global). 1089 Copyright © 2009, IGI Global, distributing in print or electronic forms without written permission of IGI Global is prohibited. Chapter 4.8 Conceptualizing Competences in E-Services Adoption and Assimilation in SMEs Ada Scupola Roskilde University, Denmark ABSTRACT This article investigates the competences deemed necessary both at top managerial and individual levels for the successful adoption and assimilation of business-to-business e-services in small and medium size enterprises. To this end, an in-depth case study of a business-to-business e-service system, a Web-based travel reservation system, was conducted. The results show that three main competences, namely vision, value and control, are important at top management level for the primary adoption of e-services. For secondary adoption and assimilation, three categories of FRPSHWHQFHVZHUHLGHQWL¿HGDVEHLQJLPSRUWDQW either to have or to develop at the individu al level, namely technical, interpersonal and conceptual skills. INTRODUCTION The aim of this study is to explore the competen- cies that are needed by small and medium size corporations (SMEs) in order to successfully DGRSWDQGDVVLPLODWHHVHUYLFHV60(VDUHGH¿QHG KHUHDV¿UPVZLWKXSWRHPSOR\HHV2(&' 2000). An extensive body of literature has argued and investigated the importance of e-commerce technologies and e-services for the competitive DGYDQWDJHRIWKHVPDOODQGPHGLXPVL]H¿UPV (e.g., Grandon & Pearson, 2003; OECD, 2000). In addition, many studies have investigated the barriers to the adoption and diffusion of the In- ternet, e-commerce and e-business in small and P H G LX P VL ] H¿ U P V D V ZH O O D V I D F WR U VD I IH F W L Q JW K H adoption and diffusion of these technologies in WKLVW\SHRI¿UPHJ0LUFKDQGDQL0RWZDQL 2001; Scupola, 2003). Some of these studies have focused on competencies as it is thought that they PLJKW SRVLWLYHO\ LQÀXHQFH WKH ¿UP¶V VWUDWHJLF commitment to the adoption and assimilation of 1090 Conceptualizing Competences in E-Services Adoption and Assimilation in SMEs technologies such as e-commerce or e-services (Chaston & Mangles, 2002; Eikebrokk & Olsen, 2002; McGowan, Durkin, Allen, Dougan, & Nixon, 2001; Wainwright, Green, Mitchell, & Yar row, 2005). ,QWKLVDUWLFOHHVHUYLFHVDUHGH¿QHGDVVHUY- ices that are provided or consumed through the use of Internet-based systems. The consumption or the provision of a service requires the interac- tion between the service provider and the user. Traditionally, this has been based on personal interactions, most often face-to-face interac- tions. In e-services, the consumption and the provision take place through the intermediation of an Internet-based system and therefore are separated in time and space (Fuglsang & Sundbo, 2006). E-services can involve a number of dif- ferent relations: business to consumer, business to business, government services offered on the Internet or e-government. E-services also include the selling of physical goods on the Internet such as an airline ticket that is purchased online, but delivered by surface mail. There are three main characteristics of e-services: • The service is accessible via the Internet or other electronic networks, • The service is consumed by a person via the Internet or other electronic networks, and • There might be a fee that the consumer pays the provider for using the e-service, but that might not always be the case. For example, some e-services offered by the government are free (Scupola, 2008). The purpose of this article is to investigate the competences required for the successful adoption and assimilation of business-to- business e-services in small and medium size enterprises. The basic research question tackled here is: What are the competences required both at the top managerial and individual levels for the successful adoption and assimilation of business-to-business e-services in small and medium size cor- porations? To answer the research question, a theoretical model of e-service competen- cies is developed and a case study of an e-service system is conducted. The results show that three main competences, namely vision, value and control, are important at top management level, while a number of competences are important at the individual level. The article is structured as follows. This section has presented the main purpose and motivation of the study. The next section discusses adoption and assimilation. This is followed by a literature review relating to the concepts of competence, IT competence, and the development of a model to investigate e-services competencies. It also discusses the methodology employed. The re- maining part of the article presents the analysis, the discussion and the conclusions. Adoption and Assimilation of E-Services )RUWKHSXUSRVHRIWKLVVWXG\DGRSWLRQLVGH¿QHG DV³WKHGHFLVLRQWRPDNHIXOOXVHRIDQLQQRYDWLRQ as the best course of action available” (Rogers, 1995, p. 21). According to Zaltman, Duncan, and Holbeck (1973) innovation adoption within RUJDQL]DWLRQVRIWHQRFFXUVLQWZRVWDJHV7KH¿UVW LVD¿UPOHYHOGHFLVLRQWRDGRSWWKHLQQRYDWLRQ also called primary adoption; the second is the actual implementation or individual adoption by XVHUVDOVRFDOOHGVHFRQGDU\DGRSWLRQ$WWKH¿UVW level, managers identify objectives to change some aspect of their business and look for innovations WKDW¿WWKHLUREMHFWLYHV7KHQWKH\PDNHWKHSUL- mary adoption decision (Gallivan, 2001). Once the primary adoption decision has been made, the implementation and use of the innovation at the individual level takes place. According to Gallivan (2001), management may proceed by taking three fundamentally different paths to ensure secondary adoption: (1) they can mandate 1091 Conceptualizing Competences in E-Services Adoption and Assimilation in SMEs that the innovation be adopted throughout the organization at once; (2) they can provide the necessary infrastructure and support for users to adopt the innovation, while allowing it to diffuse YROXQWDULO\RUWKH\PD\WDUJHWVSHFL¿FSLORW SURMHFWVZLWKLQWKH¿UPREVHUYHWKHSURFHVVHV and outcomes that unfold, and decide whether to introduce the innovation more widely later on. This two-stage adoption model has also been de- ¿QHGDVDFRQWLQJHQWDGRSWLRQGHFLVLRQPHDQLQJ that employees cannot adopt the innovation until primary adoption has occurred at a higher level of authority, often managerial or top management (Zaltman et al., 1973). Assimilation is defined as the extent to which the use of a technology diffuses across organizational work processes and becomes routinized in the activities associated with those processes (Tornatzky & Klein, 1982). Moreover, it is important to look at assimilation because the adoption of a technology at a company level does not automatically lead to assimilation and use. Fichman and Kemerer (1999), for example, show that most information technologies exhibit an assimilation gap that is their rates of organiza- tional assimilation and use lag behind their rates of organizational adoption. The Concept of Technology Competence The concept of competence has been much discussed in different types of research such as management, human resources and information systems and there is much confusion regarding WKHGH¿QLWLRQRIFRPSHWHQFH)XUWKHUPRUHWKH concept of competence has been used at differ- HQWDQDO\WLFDOOHYHOVIRUH[DPSOHWDVNVSHFL¿F FRPSHWHQFHV¿UP VSHFL¿FFRPSHWHQFHVRU LQ- GXVWU\VSHFL¿FFRPSHWHQFHV1RUGKDXJ &RPSHWHQFHKDVRIWHQDOVREHHQLGHQWL¿HGZLWK performance. But if performance has been used DVDSUR[\IRUFRPSHWHQFHGXHWRWKHGLI¿FXOW\RI measuring competence, the mixing of competence with performance often implies mixing the out- come with the process. However, a large amount of literature distinguishes between competence and performance, especially in relation to competence D VD V SH FL ¿ FV N LO O 0 D U F RO L Q & RP S H D X 0X Q U R D QG +XIIGH¿QHXVHUFRPSHWHQFHDV³WKHXVHU¶V potential to apply technology to its fullest possible extent so as to maximize the users’ performance RQVSHFL¿FMREWDVNV´&RPSHWHQFHLVDOVRVHHQ as a personality trait, and might include generic knowledge, motivation, social role, or skill of a person linked to superior performance on the job (Haynes, 1979). Competence has also been associ- ated with knowledge, and in this view competence LVQRWRQO\WDVNVSHFL¿FEXWHPERGLHVWKHDELOLW\ to transfer knowledge across tasks, thus becom- ing interactive and dynamic (Brown, 1994). In human capital theory, the concept of competence KDV EHHQ UHODWHG WR VSHFL¿F ¿UP WHFKQRORJLHV and to the execution of tasks that are related to the technology and the routines required to use that technology. Furthermore, there are many different typologies of competences found in the literature. For example, Yukl (1989) develops a typology that consists of technical, conceptual and interpersonal competences. IT COMPETENCE MODELS AND IT COMPETENCE A number of models have been developed to LQYHVWLJDWH,7FRPSHWHQFLHVLQVPDOO¿UPV Wainwright et al. (2005) develop a competency based model to be used for comparing practice and performance with respect to ICT within small ¿UPV 7KH\ SURSRVH WKDW DQ ,&7 FRPSHWHQFH and capability approach can be a viable research avenue for investigating IT performance in small ¿UPV&KDVWRQDQG0DQJOHVSURSRVHWKDW the resource-based view of competitive advantage may provide the basis for assessing the ability of an organization to exploit the Internet to enhance market performance. They develop a competency 1092 Conceptualizing Competences in E-Services Adoption and Assimilation in SMEs PRGHOWRGH¿QHWKHFRPSHWHQFLHVDQGFDSDELOLWLHV WKDWPD\LQÀXHQFHWKHH[HFXWLRQRIDQ,QWHUQHW marketing strategy. Their results show that the proposed competencies such as positioning, in- QRYDWLRQDQGVRIRUWKDUHFULWLFDOIRUVPDOO¿UPV to achieve market performance. Fi n a l l y, a s w i t h t h e c o n c e p t o f t e c h n o l o g y c o m - petence, the concept of competence related to IT KDVEHHQGH¿QHGLQGLIIHUHQWZD\VDQGKDVIRFXVHG on different levels of analysis (Table 1 provides a summary of studies of IT competence). The stream of literature focusing on the or- ganizational level (e.g., Van der Heijden, 2000) LVLQÀXHQFHGE\SDUDOOHOVWXGLHVLQWKHPDQDJH- ment literature and especially by the resource based view of strategic advantage (e.g., Barney, 1991; Prahalad & Hamel, 1990). The other stream of research focuses on the individual level, for example, Basselier, Reich, and Banbasat (2001) study IT competences in business managers, and LGHQWL¿HVDFRQFHSWRI,7NQRZOHGJHWKDWLVGH- composed into explicit IT knowledge and tacit IT knowledge. Explicit IT knowledge is knowledge that can be read, taught or explained to others. 7DFLW,7NQRZOHGJHLVPRUHGLI¿FXOWWRH[SODLQ and to do so Basselier et al. use the constructs of experience and cognition. Experience relates to the managers’ know how, while cognition involves more then doing things, and refers to working models of the world that an individual forms, including acumen, beliefs and viewpoints. However, this kind of literature has not focused on other factors related to competences such as communication, social or leadership skills. Author 'H¿QLWLRQRI&RPSHWHQFH Individual/Organizational Level Basselier et al. (2001) IT related explicit and Tacit Knowledge Individual level (Business Manger) Lee & Trauth (1995) Critical Knowledge and Skills Individual level (IS professionals) Bharadwaj, Sambamurthy & Zmud (2000) Critical IT Capabilities Organizational Level Van der Heji- den (2000) IT core capabilities; organization VSHFL¿FURXWLQHVVNLOOVUHVRXUFHV and processes Organizational Level and IT management) Sambamurthy & Zmud (1994) Capabilities, skills and tacit know-how Organizational Level and IT management Chaston & Mangles (2002) Internet related capabilities; RUJDQL]DWLRQVSHFL¿FURXWLQHV resources and processes Organizational Level Wainwright et al. (2005) ICT related competence; Organizational ICT performance and practice Organizational Level Table 1. A summary of studies of IT competences 1093 Conceptualizing Competences in E-Services Adoption and Assimilation in SMEs , Q W K L V V W X G\ EH L QJ L QW H U H VW H GL Q W KH VP D OO ¿ U P¶V competencies deemed important for the successful adoption and assimilation of e-services both at primary and secondary levels, the focus is placed on top management and individual level compe- tencies. Top management, through their beliefs and visions can offer guidelines to managers and employees about the opportunities and risks in assimilating technological innovations (Gallivan, 2001; Chatterie, Grewal, & Sambamurthy, 2002). )R UH [ D PS O H L Q ¿ U P V Z KH U H W RS PD Q DJ H U V E HO LH YH that e-services offer a strategic opportunity, their beliefs serve as powerful signals to the rest of the ¿U P¶VHPSOR\HHVDERXWWKHLPSRU WDQFHSODFHGRQ e-services. This makes the employees and the managers use their time and energy in making sense of e-services or exploring ways in which the technology’s functionality could be leveraged WRLPSURYHWKHFRPSDQ\¶VHI¿FLHQF\URXWLQHVRU business value. In this study, therefore, managerial compe- WHQFHVEHFRPHWKHEDVLVIRUWKH¿UPV¶YLVLRQ norms, beliefs and strategies in adopting and assimilating e-services (Durkin & McGowan, 2001; Middleton & Long, 1990). Individual com- SHWHQFHVDUHUHOHYDQWLQUHODWLRQWRWKHVSHFL¿F task of adopting and using an e-service system (Brown, 1994; Haynes, 1979). A MODEL OF COMPETENCY FOR E-SERVICE ADOPTION AND ASSIMILATION Theoretical Background of the Model Durkin and McGowan (2001) develop an Internet competency model to investigate which compe- WHQFLHVWKHPDQDJHURIDVPDOO¿UPPXVWKDYHLQ order to decide the extent to which the Internet is adopted in marketing activities. They argue that the extent to which the Internet is adopted and offers a fundamental advantage for the marketing activity is contingent upon the development at the managerial level of four main competencies: vision, value, technical ability and control. These competencies are not independent of each other, but are interrelated. For example, at management OHYHOWKHUHLVVHTXHQWLDOLW\LQWKHVHQVHWKDW¿UVW the company has to develop a vision, then develop the value competency, the technical ability and ¿QDOO\FRQWURO'XUNLQ0F*RZDQ Chatterie et al. (2002) describe how the structuration theory of technology assimilation VWDWHVWKDW¿UPVDFWDVLQVWLWXWLRQVLQVKDSLQJWKH behaviours and cognitions of the individuals in the corporation in facilitating or preventing them from assimilating a technology. This can be done in three ways: 6WUXFWXUHVRIVLJQL¿FDWLRQZKHUHSUHYDLO - ing institutional structures yield meaning and understanding. Individuals apply these structures as guides to understanding how they should behave/act with respect to the assimilation of new technology. 2. Structures of legitimization, where prevail - LQJLQVWLWXWLRQDOVWUXFWXUHVYDOLGDWHVSHFL¿F behaviours as being appropriate in the or- ganization and consistent with the goals and values of the organization. Individuals draw upon these structures as normative templates to reassure themselves about the organizational legitimacy of their assimila- tion actions. 3. Structures of domination, where institutional structures regulate individual actions and behaviours. Individuals draw upon these structures to ensure that their acts of assimi- lation do not violate institutional rules and to avoid being the target of organizational sanctions (Chatterie et al., 2002, p. 68). Finally, Yukl (1989) states that three sets of competences or skills are relevant at the individual OHYHOLQH[SOLFDWLQJDVSHFL¿FWDVNRUDFWLYLW\ technical, interpersonal and conceptual skills. . businesses in Sweden and Australia. Journal of Small Business and Enterprise Development, 12(4), 510-527. Malone, T. W., Yates, J., & Benjamin, R. I. (1987). Electronic markets and electronic hierarchies De- signing and managing the supply chain: Concepts, strategies, and case studies (2 nd ed.). New York: McGraw-Hill. MacGregor, R. C., & Vrazalic, L. (2005). A basic model of electronic. the government mandate, all SMEs dealing with the local authorities should possess the ability to deal with them electronically by the end of 2005, and participation in an electronic marketplace