2015 factors that influence interorgani

This material is presented to ensure timely dissemination of scholarly and technical work Copyright and all rights therein are retained by authors or by other copyright holders All persons copying this information are expected to adhere to the terms and constraints invoked by each author's copyright In most cases, these works may not be reposted without the explicit permission of the copyright holder This version of the referenced work is the post-print version of the article—it is NOT the final published version nor the corrected proofs If you would like to receive the final published version please send a request to any of the authors and we will be happy to send you the latest version Moreover, you can contact the publisher’s website and order the final version there, as well The current reference for this work is as follows: Kristijan Mirkovski and Paul Benjamin Lowry (2015) “Factors that influence interorganizational use of information and communications technology in relationship-based supply chains: Evidence from the Macedonian and American wine industries,” Supply Chain Management: An International Journal (SCM) (accepted 23-Nov-2015) If you have any questions, would like a copy of the final version of the article, or would like copies of other articles we’ve published, please email any of us directly Kris is at kmirkovsk2@gmail.com; Paul is at Paul.Lowry.PhD@gmail.com Paul also has an online system that you can use to request any of his published or forthcoming articles To go to this system, click on the following link: https://seanacademic.qualtrics.com/SE/?SID=SV_7WCaP0V7FA0GWWx Factors that influence interorganizational use of information and communications technology in relationship-based supply chains: evidence from the Macedonian and American wine industries Abstract Purpose: The purpose of this research is to better understand how interorganizational relationships influence information and communications technology (ICT)-enabled supply chain (SC) interactions of small-to-medium enterprises (SMEs) in developed versus developing economies through the theoretical lens of transaction cost economics (TCE) and social exchange theory (SET) Design/methodology/approach: The paper uses case study data to study SMEs operating in both a developing economy, the Republic of Macedonia, and a developed economy, the United States Findings: Insights reveal that the institutional context (i.e., environmental uncertainty) has significant indirect influence on ICT use by SMEs from rule-based and relationship-based supply SCs in the wine industry through contractual and relational mechanisms (i.e., contracts and social bonds) Research implications/limitations: This study contributes to the body of SC knowledge by providing a comparative qualitative analysis of interorganizational factors (e.g., information sharing, collaboration, trust, contractual governance, relational governance, environmental uncertainty) that influence ICT use by SMEs in upstream wine SC from developing (i.e., Macedonia) and developed economies (i.e., the US) Practical implications: This paper provides valuable implications for the SC participants (e.g., grape farmers, wineries and other suppliers) and industries (e.g., Macedonian and American wine industries) related to ICT use and non-use Originality/value: This study makes a novel contribution by being the first to qualitatively explore the ICT use in SMEs from the wine industry and identify the importance of legal institutional environment in buyer–supplier exchanges from developed and developing economies Keywords: Supply chain integration, Developed economies, Developing economies, ICT use, SMEs, Wine industry Article Classification: Research paper Introduction Since the 1990s, manufacturers have significantly improved productivity by implementing lean production procedures (Wee and Wu, 2009) Accordingly, achieving further operational efficiencies for most manufacturers is difficult nowadays However, much can still be done to address the inefficiencies caused by suppliers’ poor performance, customers’ volatile demand, and environmental uncertainty An integrated supply chain (SC) with smooth information, material, and financial flows can considerably improve the individual manufacturer’s performance (So and Sun, 2010) A particularly promising context to improve SCs is through integration of small and mediumsized enterprises (SMEs) SMEs comprise 95% of the enterprises around the world and account for 60% of the private-sector employment (ACCA, 2010) Integrating SMEs into SCs of larger organizations enhances the productivity and performance along the entire value chain (Quayle, 2003) However, the integration and management of SCs is a major challenge for SMEs Enterprise-level communication and collaboration technologies (e.g., email, VoIP, content management systems, web conferencing, business process management) and SC management (SCM) technologies (e.g., EDI, bar codes, RFID) support the integration of SC information between upstream and downstream partners through timely information sharing and effective collaboration (Devaraj et al., 2007) Despite the benefits of information and communication technologies (ICTs), SMEs experience difficulties with ICT adoption and use Dholakia and Kshetri (2004) found that employees’ low IT knowledge, lack of CEO’s innovativeness, perceived productivity decrease and high costs, and lack of visible return on investment are the most common barriers to ICT adoption and use among SMEs in Australia and Denmark ICT adoption and use inhibitors have been studied both in developed economies (Dwivedi et al., 2009) and in developing economies (Kurnia et al., 2015), confirming that findings from developed economies are not directly applicable to developing economies due to differences in infrastructure and culture A majority of the studies on the ICT adoption and use by SMEs in developed and developing economies focus on a single country and test only well-documented factors from the technologyorganization-environment (TOE) and diffusion of innovation (DOI) frameworks They overlook the interorganizational relationships that are essential to buyer–supplier exchanges in SCs Fischer (2013) found trust to be a crucial element of interorganizational governance in the European agricultural industry By contrast to manufacturing firms, wineries have a high dependency on natural resources and specific tacit know-how (e.g., local recipes) to produce wine (Dries et al., 2013) They have to transform unlike and uneven raw materials flow (e.g., each harvest being different from the previous in terms of quantity and quality, and each influenced by uncontrollable events like weather) to marketable products Moreover, the wine industry is quite fragmented and its key SC actors are operating under incompatible operational standards such as measurements of sugar units in fresh grapes vary across regions Therefore, trust, is a crucial mechanism in the wine industry; it facilitates buyer–supplier transactions in this fragmented and artisan-oriented industry (Bordonaba-Juste and Cambra-Fierro, 2009) Hence, looking at the trust antecedents might be key to overcoming the SC challenges (even malfunctions) in the wine industry related to the heterogeneous and discontinuous raw materials flow, and differences in operational standards between partners Despite these opportunities, little research has been conducted on the factors influencing ICT use by SMEs from an interorganizational perspective The purpose of this research is to better understand how interorganizational relationships influence ICT-enabled SC interactions of SMEs in developed versus developing economies We provide a comparative analysis of the role that institutional context plays on the ICT use by SMEs in the Macedonian and American wine industries We attempt to explain the relationships between institutional context (i.e., environmental uncertainty), governance (i.e., contractual and relational governance), and ICT-enabled SC practices of information sharing and collaboration Transaction cost economics (TCE) and social exchange theory (SET) are deployed to shed light on the explanatory mechanisms (i.e., contracts and social bonds) in the relationship between the institutional context and ICT use by SMEs in the developed versus developing world Finally, we provide valuable implications for the SC actors and subsequent industries related to ICT use and non-use Literature review ICT adoption and use in SMEs Several studies have investigated the factors that influence ICT adoption and use among SMEs in developed and developing economies Most of these studies focus on a single country and test only welldocumented factors from TOE (Tornatzky and Fleischer, 1990) and DOI (Rogers Everett, 1995) frameworks Previous single-country studies on ICT adoption and use by SMEs in developed economies have adopted TOE and DOI frameworks to empirically identify and classify the adoption factors into three categories: technological, organizational, and environmental (see Table A1 in Appendix A) Previous single-country studies on ICT adoption and use by SMEs in developing economies have used several perspectives in their investigations: managerial, technological, organizational, and environmental (see Table A2 in Appendix A) To date, few studies have compared ICT adoption behavior by SMEs in developed and developing economies (see Table A3 in Appendix A) We address this literature gap by conducting a comparative study on ICT use by SMEs in the Macedonian (developing economy) and American (developed economy) wine industries from the perspective of interorganizational relationships We provide a comparative study of the influence of institutional context on governance, which influences trust, information sharing, collaboration, and ICT use Relationship-based SCM Sako (2004) identified two ideal contracting relationships between suppliers and customers in SCs: arms’ length contractual relationships (ACRs) and obligational contractual relationships (OCRs) ACRs are associated with rule-based economies and characterized by low mutual dependence—numerous partners, short-term commitments, price orientation, written and comprehensive contract governance, limited mutual communication, and a low degree of technology and risk sharing Conversely, OCRs are associated with relationship-based economies and characterized by high mutual dependence—few partners, long-term commitment, loosely defined terms of governance, extensive mutual communication, and a high degree of technology and risk sharing Juxtaposing the difference between ACRs and OCRs, in developing economies, such as China, in which legal institutions—contract law, the rule of law, and the enforcement of rights—are weak and the environment is volatile, firms have to rely on relationship-based strategies that provide organizational flexibility (Cai et al., 2010) Establishing and nurturing relationships with suppliers, competitors, agents in distribution channels and government authorities are critical activities for firms in developing economies (Zhou and Xu, 2012) Hence, firms in developing economies are more likely to establish relationship-based SCs that operate based on personal trust rather than on legally enforceable rules Liu et al (2009) found that trust and relational norms, which are key constituents of relational governance and relationship-based SCs, are important for reducing opportunism and improving relationship performance in buyer–supplier dyads in China Our study examines how the influence of contracts and social bonds on trust varies between a relationship-based SC from a developing economy and a conventional SC from a developed economy We explore how the institutional context contributes to this variation, which influences trust, information sharing, collaboration and, ultimately, ICT use Theoretical development and propositions Here, we explain and apply two theories to our research context: TCE and SET Our research model and propositions are developed by incorporating arguments on six core elements of interorganizational relationships in wine SCs TCE and SET TCE is theoretical framework that defines the conditions under which firms should perform their internal and external value chain activities (Williamson, 1975) TCE proposes two fundamental modes— market and hierarchy—for organizational governance and material flows coordination Market refers to the outsourcing activities where material flow is coordinated by supply and demand forces through external transactions between firms Hierarchy defines the internal production where material flow is coordinated by managerial decisions Additionally, MacNeil (1980) introduced a relational model of organizational governance that has tighter interorganizational links at the integrated stages in the value-adding process Contemporary firms have decentralized their value-adding activities throughout their SCs to attain business agility Despite reducing production costs, the management of such distributed operations increases transaction costs, which are associated with resource procurement, exchange partner monitoring, and interorganizational coordination of production processes (Das and Teng, 2000) SET was developed to explain exchange mechanisms in interpersonal relationships within a social context (Emerson, 1976) SET considers the interaction processes between parties to be the center of their social exchange relationships in which one participant’s behavior is influential and evokes responses from other participants Considering the dyadic relationship as an exchange relationship sustained by interaction processes through the prism of SET, researchers have proposed that the consequences of specific actions taken by a firm are largely dependent on the reactions of the other firms in the exchange relationship (Anderson and Narus, 1990) Proposed research model Based on the theories in use and prior literature, we identified six factors—information sharing, collaboration, trust, contractual governance, relational governance, and environmental uncertainty—as core to interorganizational relationships in buyer–supplier exchanges, which influence ICT use by SMEs in wine SCs They are integrated into our proposed research model (see Figure 1) Propositions are only provided for the relationships between trust, contractual governance, relational governance, and environmental uncertainty (i.e., propositions 1, 2, 3a, and 3b) The relationships between information sharing, collaboration, trust, and ICT use are supported by prior literature INSERT FIGURE ABOUT HERE Information sharing Information sharing is defined in terms of communication frequency and information quality (Fischer, 2013) That is, “information flows are reflected in the quality of information and the amount of information” (Spekman et al., 2002, pp 44) Low and Mohr (2001) suggested that information quality is composed of four dimensions: relevance, accuracy, reliability, and timeliness It is also important that the information exchange has adequate frequency (Fischer, 2013) We focus on information sharing in three wine SC processes: initial negotiations, delivery dates and product availability exchange, and technical product specification exchange Information sharing is one of the most important factors for successful SCM (Zhou and Benton, 2007) Efficient SC operations and successful buyer–supplier relationships require dissemination of relevant, accurate, and comprehensible information (Zhao et al., 2002) Effective communication provides relevant information to a truster with which he/she is in a better position to assess a trustee’s activities; thus improving the transparency and positively affecting trust in buyer–supplier dyads (Fischer, 2013) Research has shown that information sharing has positive impact on collaboration and trust in buyer–supplier relationships Fischer (2013) found that successful information sharing has significant influence on trust between SC partners Buyers and suppliers achieve an effective level of communication when relevant information is exchanged at an adequate frequency Kwon and Suh (2004) revealed that information sharing has a positive relationship with trust and mediates the relationship between behavioral uncertainty and trust in SCs Wiengarten et al (2010) showed that joint decision making has a stronger positive effect on operational performance when the exchanged information is characterized by high quality compared to low quality information Clemons et al (1993) emphasized the importance of ICT in SCM and its ability to reduce coordination costs, operational risk, and opportunism associated with external transactions The ICT use increases the level and quality of interorganizational communication ICTs can be efficient platforms for searching, contact, and negotiation, which minimizes opportunistic behavior and transaction costs Therefore, whenever a winery increases its information exchange frequency with a supplier, it is more likely that ICT will be the preferred channel for information sharing Collaboration Collaboration is defined as the joint work between two or more SC partners to plan or execute operations together with greater success rather than in isolation (Simatupang and Sridharan, 2002) Matopoulos et al (2007) proposed a conceptual framework for SC collaboration, which is composed of two pillars: (1) design and government of SC activities (e.g., selecting techniques and technologies for information exchange, collaboration partner, collaboration width and depth); (2) establishment and maintenance of SC activities (e.g., management of power, trust, dependence) Collaboration can happen horizontally with competitors, universities or collaboration intermediaries or vertically with supplier or customers, and over operational, tactical, or strategic SC activities (Barratt, 2004) We focus only on the vertical collaboration between wineries and their supplier for new product development and introduction Cao and Zhang (2011) showed that SC collaboration improves collaborative advantage and indeed has a bottom-line influence on firms’ performance by reducing purchasing costs and improving technical cooperation Previous studies found that collaboration is positively associated with information sharing and trust Fischer (2013) found that positive past collaboration increases successful information sharing and improves trust in buyer–supplier relationships Scholten et al (2015) revealed that collaboration increases SC resilience through increased visibility, velocity, and flexibility The more collaboration between buyers and suppliers, the better the extent to which SC actors have access to timely information about SC operations Narayanan et al (2015) discovered that trust mediates the impact of collaboration on agility performance An increase in collaboration in buyer–supplier relationships positively influences trust, which improves the SC performance agility Fawcett et al (2011) argued that ICT can enhance collaboration activities between SC partners due to their common interests to work on mutual concerns An empirical study conducted in the telecommunication industry showed that managers developed positive attitudes toward ICT due to its collaborative nature and capacity to facilitate innovation (Cassivi, 2006) Accordingly, collaboration on the development and introduction of new products through ICT mitigates opportunism and reduces transaction costs associated with control and monitoring activities, which encourages a winery to use ICT for collaboration over other channels such as face-to-face (FtF) Trust Trust “is exhibited when a truster displays a willingness to be vulnerable to the trustee based on the expectation that the trustee will perform as desired by the trustee” (Moody et al., 2014, p 266) Interorganizational trust in our context describes the probability of a partner’s behavior toward a vulnerable focal firm in a SC When a partner has positive expectations, the focal firm becomes more confident in the partnership, mitigating future concerns about opportunism (Gulati and Nickerson, 2008) Trust is an essential element of the social capital that is directly linked to supplier performance (Johnston et al., 2004) and competitive advantage (Cheng et al., 2008) Prior literature suggests that trust enhances information sharing and collaboration Cai et al (2010) looked at the influence of institutional forces (i.e., legal protection, government support, and guanxi) on information integration in SCs from China Results showed that trust increases information sharing and collaborative planning in buyer– supplier dyads Anastasiadis et al (2015) showed that low trust levels inhibit information flows between buyers and suppliers in Greek agri-food SCs Sharing vital information makes SC partners vulnerable to opportunistic behaviors However, trust increases the confidence of trading partners that each will use the provided information appropriately without engaging in opportunistic behaviors Trust mitigates the inherent information asymmetry between SC partners by allowing more open and honest information sharing (Zaheer et al., 1998) Croom et al (2007) revealed that a manufacturer with a higher level of perceived benevolence of suppliers’ interests about its welfare is less likely to be apprehensive about suppliers’ opportunistic behaviors Frequent the numbers that they provide me with, and I trust them to supply quality grapes (Omega-Rho Winery’s Manager/Owner) Wineries face considerable environmental uncertainty in exchanges for fresh grapes in terms of product manufacturing, product quality, product supply, product availability, and price volatility Thus, wineries prefer to establish social bonds (mostly emotional and less obligational) over contracts with vineyards responsible for the supply of fresh grapes: The guy that we have known for so long, we don’t ever know what grapes we are actually going to get from him until we come up to the season and see what the harvest is And then we will not know whether he will have them for us (Pi Winery’s Manager/Owner) Less environmental uncertainty exists in exchanges for raw materials such as corks, glass bottles, yeast, labels, and capsules This context encourages contracts rather than social bonds with suppliers: I get lot of winemaking supplies from Davison Winery Supplies [in Portland] I have never met any of those people, but you know they are a reputable business (Phi-Beta Winery’s Manager/Owner) Discussion and conclusion In this section, we discuss our findings about the relationships between trust, contractual governance, relational governance, and environmental uncertainty (i.e., propositions 1, 2, 3a, and 3b) We also discuss the relationships between information sharing, collaboration, trust, and ICT use as they are foundational to our research model Results summary Information sharing and collaboration Macedonian and American wineries preferred to use ICT due to its cost reduction and efficiency improvement capabilities rather than its function to decrease opportunism with suppliers with whom they frequently exchanged information and collaborated This finding is in line with Clemons et al (1993) and Fawcett et al (2011) conclusions that ICT reduces coordination costs and enhances collaboration between 22 SC partners Our study demonstrates that ICT is an efficient platform for searching, contact, and negotiation that reduces transaction costs Trust The perceptions Macedonian wineries about suppliers’ integrity, benevolence, and competence (in manufacturing and delivery) led to the acceptance of influence, high autonomy, free information sharing, and business continuance, which facilitate information sharing, collaboration, and ICT use Trust also indirectly influenced the ICT use through information sharing in the American wineries Our findings are incongruous with Cai et al (2010) that trust increases information sharing and collaborative planning in buyer–supplier dyads Also we have similar conclusions as Croom et al (2007) about trust mitigating opportunistic behaviors in SCs Contractual governance Macedonian wineries did not rely on contractual governance due to the low legal enforceability of contracts in Macedonia (P1 is not supported) By contrast, American wineries disclosed that contracts had a positive impact on wineries’ trusting beliefs about suppliers’ integrity and benevolence (P1 is supported), which is consistent with previous studies (Cao and Lumineau, 2015) about contracts being effectively mechanisms for regulating exchanges and minimizing opportunism The difference in the legal institutional environment in Macedonia and the US might explain these findings Wineries tend to prefer contracts with suppliers in highly regulated markets and avoid it in deregulated markets As a typical developing economy, Macedonia lacks a sound institutional framework This reduces contract effectiveness as a protection mechanism against opportunistic behavior and promotes social bonds as an informal mechanism for regulating buyer–supplier exchanges The developed US economy, representing a highly regulated and rule-based market, has stable institutional frameworks that advocate contracts as an efficient protection mechanism for opportunistic action in SC exchanges Relational governance We found that social bonds had a positive impact on wineries’ trusting beliefs about suppliers’ 23 benevolence, integrity, and competence in both the Macedonian and American winery cases (P2 is supported) Relational governance increases wineries’ trusting beliefs about suppliers’ integrity, benevolence, and competence More specifically, emotional (e.g., personal relationships) and obligational (e.g., giving and receiving favors) attachments have positive influence on wineries’ perceptions that suppliers make good-faith agreements, are motivated to act in their interest, and possess manufacturing/delivery capabilities to fulfill their demands Social bonds facilitate buyer–supplier exchanges through personal trust that compensates for the lack systemic trust This finding is consistent with previous studies (Liu et al., 2009) on relational governance’s role in dyadic relationships Our study demonstrates that social bonds, such as emotional and obligational linkages, are valuable mechanisms for regulating buyer–supplier transactions in SCs Environmental uncertainty Environmental uncertainty was found to decrease contracts use and to encourage social development of the Macedonian wineries (P3a and P3b are supported), because of the flawed legal institutional framework Environmental uncertainty had a positive and negative influence on social bonds and contracts, respectively, in the case of American wineries (P3a and P3b are supported) Because American wineries face considerable uncertainty in exchanges with grapes suppliers, they tend to establish personal relationships with grape farmers The low environmental uncertainty with suppliers for corks, glass bottles, yeast, labels, and capsules encourages the American wineries to establish contracts American wineries’ managers/owners see social bonds in such highly regulated markets as a time waste The legal institutional environment influence on contracts and social bonds is consistent with a study conducted on 399 buyer–supplier exchanges in China (Zhou and Poppo, 2010) INSERT TABLE ABOUT HERE - Contributions to SCM theory Our contribution to SCM theory is twofold First, most studies on ICT adoption and use by SMEs 24 in developed and developing economies conducted single-country analyses and tested well-documented factors from the TOE and DOI frameworks, which focus on technological, environmental, and organizational factors rather than on interorganizational relationships Also a few comparative studies have taken into consideration the factors influencing ICT adoption and use by SMEs from an interorganizational perspective Our study contributes by providing a comparative, qualitative analysis of interorganizational factors (i.e., information sharing, collaboration, trust, contractual governance, relational governance, and environmental uncertainty) that affect the ICT use by SMEs in upstream wine SCs from developing (i.e., Macedonia) and developed economies (i.e., the US) We attempt to better understand the relationships between institutional context (i.e., environmental uncertainty), governance (i.e., contractual and relational governance), and ICT-enabled SC practices (i.e., information sharing and collaboration) Furthermore, our study makes a novel contribution by being the first to qualitatively explore the ICT use in SMEs from the wine industry and to identify the importance of legal institutional environment in buyer–supplier exchanges from developed and developing economies As further SCM theoretical contributions, we leveraged TCE and SET to identify the explanatory mechanisms (i.e., contracts and social bonds) in the relationship between the institutional context and ICT in developed and developing economies In developed economies with regulated markets and sound institutional mechanisms, contracts are an effective governance mechanism Whereas, social bonds represent an informal mechanism in the form of unwritten agreements between a buyer and a supplier They are not enforceable by formal authority and power but rather by the aspiration to nurture a reputation of integrity Social bonds facilitate buyer–supplier exchanges through personal trust, which compensates for the lack of institutional frameworks in developing economies Implications to SCM practice Firms who intend to leverage ICT to facilitate information sharing and collaboration with their SC partners will benefit from the findings of this study First, firms have to use both contracts and social bonds with their suppliers, and this action will increase trust associated with information sharing, 25 collaboration, and ICT use SMEs operating in developed economies should focus on using contracts with SC suppliers, as they are considered effective governance mechanisms Particular attention should be paid to the governance of the exchanges between wineries and grape farmers due to the inherent uncertainty related to the quality of fresh grapes Contracts should be used to define the general provisions (e.g., refund policies) and obligations (e.g., periodic grape inspections), which should be reinforced by tight social bonds to ensure relevant, accurate, reliable, and timely information exchange Cao and Lumineau (2015) found that contracts and social mechanism are complementary and their interplay is beneficial to buyer–supplier exchanges On the other hand, SMEs operating in developing economies and volatile environments should pursue relational governance to regulate their exchanges Crucially, social bonds are more effective when nurtured with suppliers that are geographically proximate to the buyers For example, relational governance should be practiced with the suppliers that operate in the same region with the winery Second, ICT non-use for SC actors has a negative impact on the competitiveness of the wine industry Due to the underdeveloped legal institutional framework, buyer–supplier exchanges in the Macedonian wine industry are largely governed with relational mechanisms (e.g., social bonds) Macedonian wineries impose laborious and unnecessary control activities for the operations of their suppliers because their interests are not legally protected by the institutional framework Such inefficiencies reduce ICT use for information sharing and collaboration, which confines SC actors to focus on value adding activities (e.g., developing and introducing new products) and reduces the competitiveness of SCs from developing economies in a global wine industry For example, Delta Winery excessively controls labels supplier (i.e., printing house) when designing and printing their wine labels due to the lack of protection in Macedonia’s legal system Third, to improve the quality of institutions to increase ICT use of SC actors, developing economies governments should: (1) introduce independent regulatory agencies (e.g., chamber of commerce and arbitration); (2) adopt modern legislation for business integrity and corruption prevention 26 (e.g., anti-bribery laws, anti-corruption agencies); (3) develop strategies for self-regulation of exchanges (e.g., codes of conduct through employee training, non-government organization involvement) Limitations and future research Our research findings are applicable to the other regions of the US wine industry that have dominant SME populations because these regions resemble each other in terms of infrastructure, knowledge flows, SC 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SMEs in Developed Economies Author(s) Iacovou et al (1995) Thong (1999) Dwivedi et al (2009) Dholakia and Kshetri (2004) Ramdani and Kawalek (2007) ICT Adoption Factors Perceived Benefits Organizational Readiness External Pressure CEO Characteristics: innovativeness, information system knowledge Information System Characteristics: relative advantage, compatibility, complexity Organizational Characteristics: business size, information technology knowledge of employees, information intensity Environmental Characteristics: competition Technological Context: ICT relative advantage (barriers and benefits, ICT related technologies Organizational Context: CEOs characteristics and top management support, employees’ Information System knowledge and attitude, resource constraints External Environment: role of government, technology infrastructure Internal Factors: firm size, self-efficacy, past experience with related technologies, past use of marketing media External Factors: perceived competitive pressure Technological Context: relative advantage, compatibility, complexity, trialability, observability Organizational Context: top management support, organizational readiness, Information Technology experience, firm size Studied Industry Research Methodology Manufacturing and services Case study (n=7) Manufacturing, commerce and services Manufacturing, commerce and services Theoretical Framework TechnologyOrganizationEnvironment TechnologyOrganizationSurvey (n=200) Environment and Diffusion of Innovation Case study (n=8) TechnologyOrganizationEnvironment TechnologyProfessional services, retail, Survey (n=115) Organizationautomotive, constriction, fishing, Environment community services Manufacturing, services and retail/wholesale Case study (n=8) TechnologyOrganizationEnvironment and Diffusion of Innovation Subject Country Canada Singapore Australia and Denmark United States United Kingdom Environmental Context: industry, market scope, competitive pressure, external Information Technology support Table A2 Literature Review on ICT Adoption and use by SMEs in Developing Economies Author(s) Sin Tan et al (2009) Alam et al (2011) Zaied (2012) Kurnia et al (2015) ICT Adoption Factors Technological Factors: relative advantage, compatibility, trialability, observability, complexity, security, perceived costs, benefits, barriers Technological Factors: relative advantage, compatibility, perceived ease of use, security, perceived cost Organizational Factors: organizational readiness, managerial characteristics Organizational Barriers: resistance to change, Internet proliferation in the industry, lack of management support, difficulty in business process reengineering Political Barriers: frequent government change, frequent policy change, low level of e-readiness in government institutions, unsupportive legal environment Legal Barriers: lack of e-trading regulations, absence of a legal and regulatory system, complex procedures and guidelines, lack of e-commerce standards Social and Cultural Barriers: language barrier, lack of awareness, lack of external pressure, lack of industry ICT diffusion, lack of public ICT diffusion Economic Barriers: lack of financial infrastructure, lack of secure payment infrastructure, competitive pressure, unclear benefits of ICT adoption Technical Barriers: diffusion of innovation, poor bandwidth, lack of ICT-skilled workforce, lack of Internet security, lack of e-commerce infrastructure Technological Context: perceived benefits, compatibility, complexity, security/risks, and cost Studied Industry Research Methodology Theoretical Framework Subject Country Manufacturing and services Survey (n=406) Diffusion of Innovation Malaysia Manufacturing and services Survey (n=200) TechnologyOrganizationEnvironment Malaysia Manufacturing (paper products, electricity and power, electronic products) and services (services and maintenance, printing) Survey (n=147) Manufacturing (grocery) Case Study (n=8) TechnologyOrganizationEnvironment TechnologyOrganizationEnvironment and Egypt Indonesia Rowe et al (2012) Tan et al (2007) Organizational Context: size, financial resources, information technology expertise, information technology infrastructure, top management support, organizational structure, and organizational culture Environmental Context: industry structure, competitive pressure, government support, government regulations, supporting infrastructure, and national culture Technological Factors: information system, attitude toward ICT, and attitude towards innovation Organizational Factors: size of firm, structure and culture, resources, strategic orientation, and employee’s knowledge Environmental Factors: governmental policies, cultural factors, economy, infrastructure, and self-efficacy Managerial Factors: risk-taking attitude, enthusiasm, support, and cultural profile Perceived Organizational eReadiness: educational level of employees, awareness, commitment, human resources, technological resources, business resources, and governance Perceived External eReadiness: government eReadiness, market forces eReadiness, supporting industries eReadiness Diffusion of Innovation Manufacturing, construction, and services (retail and wholesale) Survey (n=926) TechnologyOrganizationEnvironment Vietnam Manufacturing Survey (n=134) TechnologyOrganizationEnvironment China Table A3 Literature Review on ICT Adoption and use by SMEs in Developed and Developing Economies Author(s) Kartiwi and MacGregor (2007) MacGregor and Kartiwi (2010) ICT Adoption Factors ICT Adoption Barriers: product/service, intraorganizational and interorganizational process misfit, lack of awareness of ICT adoption benefits, technical knowledge, ICT security, complex implementation, low financial investment returns, time deficiency for ICT implementation, difficulties related to ICT type choice Studied Industry Manufacturing, commerce, service and agriculture Research Methodology Survey (n=313; n=179) Survey (n=247; n=96) Theoretical Framework TechnologyOrganizationEnvironment Subject Country Indonesia and Sweden Indonesia and Australia Appendix B Data analysis Table B1 Final Coding Scheme Trust (Priori and Grounded) Trusting Beliefs Supplier’s benevolence Supplier’s competence Supplier’s integrity Trust Related Behavior Priori code (McKnight and Chervany, 2001) Acceptance of influence Free information sharing High autonomy Indulgence in business Low control activities Dispute engagement Brand-equity Trust Grounded code Embedded Trust Referral Trust Governance Mechanisms (Priori and Grounded) Contract Grounded code Social Bond Priori code Emotional (Mavondo and Rodrigo, 2001) Obligational Environmental Uncertainty (Priori and Grounded) Customer demand Grounded code Price volatility Product availability Priori code Product manufacture (Noordewier et al., 1990) Product supply Product quality Information Sharing (Grounded) Synchronous information sharing Asynchronous information sharing Content certainty and precision Content tolerance and vagueness Direct information sharing Indirect information sharing Operational information sharing Strategic information sharing Collaboration (Grounded) E-collaboration Face-to-face collaboration Combined collaboration ICT Use (Grounded) Frequent ICT use Occasional ICT use Combined ICT use Legal Institutional Environment (Grounded) Protection of interest Money collection Money refund Legal enforceability References for appendices Alam, S S., Ali, M Y and Mohd Jani, M F (2011), "An empirical study of factors affecting electronic commerce adoption among SMEs in Malaysia", Journal of Business Economics and Management, Vol 12 No 2, pp 375-399 Dholakia, R R and Kshetri, N (2004), "Factors impacting the adoption of the Internet among SMEs", Small Business Economics, Vol 23 No 4, pp 311-322 Dwivedi, Y K., Papazafeiropoulo, A and Scupola, A (2009), "SMEs'e-commerce adoption: perspectives from Denmark and Australia", Journal of Enterprise Information Management, Vol 22 No 1/2, pp 152-166 Iacovou, C L., Benbasat, I and Dexter, A S (1995), "Electronic data interchange and small organizations: adoption and impact of technology", MIS Quarterly, Vol 19 No 4, pp 465-485 Kartiwi, M and MacGregor, R C (2007), "Electronic commerce adoption barriers in small to mediumsized enterprises (SMEs) in developed and developing countries: a cross-country comparison", Journal of Electronic Commerce in Organizations, Vol No 3, pp 35-51 Kurnia, S., Karnali, R J and Rahim, M M (2015), "A qualitative study of business-to-business electronic commerce adoption within the Indonesian grocery industry: a multi-theory perspective", Information & Management, Vol 52 No 4, pp 518-536 MacGregor, R C and Kartiwi, M (2010), "Perception of barriers to e-commerce adoption in SMEs in a developed and developing country: a comparison between Australia and Indonesia", Journal of Electronic Commerce in Organizations, Vol No 1, pp 61-82 Mavondo, F T and Rodrigo, E M (2001), "The effect of relationship dimensions on interpersonal and interorganizational commitment in organizations conducting business between Australia and China", Journal of Business Research, Vol 52 No 2, pp 111-121 McKnight, D H and Chervany, N L (2001), "Trust and distrust definitions: one bite at a time", Trust in Cyber-societies Springer, Berlin, Germany, pp 27-54 Noordewier, T G., John, G and Nevin, J R (1990), "Performance outcomes of purchasing arrangements in industrial buyer-vendor relationships", Journal of Marketing, Vol 54 No 4, pp 80-93 Ramdani, B and Kawalek, P (2007), "SME adoption of enterprise systems in the northwest of England", Organizational Dynamics of Technology-based Innovation: Diversifying the Research Agenda Springer, New York, NY, pp 409-429 Rowe, F., Truex, D and Huynh, M Q (2012), "An empirical study of determinants of e-commerce adoption in SMEs in Vietnam: an economy in transition", Journal of Global Information Management, Vol 20 No 3, pp 23-54 Sin Tan, K., Choy Chong, S., Lin, B and Cyril Eze, U (2009), "Internet-based ICT adoption: evidence from Malaysian SMEs", Industrial Management & Data Systems, Vol 109 No 2, pp 224-244 Tan, J., Tyler, K and Manica, A (2007), "Business-to-business adoption of eCommerce in China", Information & Management, Vol 44 No 3, pp 332-351 Thong, J Y (1999), "An integrated model of information systems adoption in small businesses", Journal of Management Information Systems, Vol 15 No 4, pp 187-214 Zaied, A N H (2012), "Barriers to e-commerce adoption in Egyptian SMEs", International Journal of Information Engineering and Electronic Business, Vol No 3, pp 9-18