Determinants of E-commerce Adoption. among Malaysian SMEs
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1 Determinants of E-commerce Adoption among Malaysian SMEs Khairul Anwar Bin Mohamad Zaki Bachelor of Mechanical Engineering Purdue University West Lafayette, Indiana United States of America 2005 Submitted to the Graduate School of Business Faculty of Business and Accountancy University Malaya, in partial fulfilment of the requirement for the Degree of Master of Business Administration July 2011
2 PREFACE ABSTRACT The use of electronic commerce (e-commerce) enables Small and Medium Enterprises (SMEs) to improve their efficiency and competitive advantage. Although researchers have been increasingly exploring and predicting e- commerce adoption among SMEs in other developing countries, there is still a limited understanding of the behaviour of Malaysian SMEs towards e-commerce technologies adoption. As in many other countries, the SME sector constitutes the majority of business activities in Malaysia, and their contribution to Malaysian economy is very significant. Yet, very little research on Malaysian SMEs has taken a holistic view of the e-commerce adoption factors, from technological, organisational and environmental contexts. This paper therefore examines the determinants of e- commerce adoption among Malaysian SMEs. The study was conducted through quantitative manner using structured questionnaires. The target audience of this study are the personnel who makes decisions (executive level and above) in Malaysian SMEs. i
3 TABLE OF CONTENTS CHAPTER 1: INTRODUCTION 1.1 OVERVIEW E-commerce Small-to-Medium sized Entreprises (SMEs) SME Definition Contribution of SMEs in Malaysia E-commerce Scenario in Malaysia SIGNIFICANCE OF STUDY RESEARCH OBJECTIVES AND QUESTIONS 10 CHAPTER 2: LITERATURE REVIEW 2.1 OVERVIEW E-commerce Studies Technology Adoption PERCEIVED ATTRIBUTES OF E-COMMERCE Technological Context Organisational Context Environmental Context CONCLUSION 22 ii
4 CHAPTER 3: RESEARCH METHODOLOGY 3.1 INTRODUCTION DEVELOPMENT OF HYPOTHESES THEORETICAL FRAMEWORK SELECTION OF MEASURES SAMPLING DESIGN DATA COLLECTION PROCEDURE Questionnaire Pilot Test Data Collection DATA ANALYSIS TECHNIQUES Descriptive Analysis Reliability Analysis Correlation Analysis 37 CHAPTER 4: RESEARCH RESULTS 4.1 INTORDUCTION DATA OVERVIEW SUMMARY STATISTICS Respondents Profile Company Profile DESCRIPTIVE ANALYSIS RELIABILITY AND VALIDITY TESTING OF HYPOTHESES 50 iii
5 4.6.1 Pearson Product-Moment Correlation Multiple Regression DISCUSSION OF RESULTS CONCLUSION 60 CHAPTER 5: CONCLUSION AND RECOMMENDATIONS 5.1 SUMMARY AND CONCLUSION LIMITATONS TO THE STUDY SUGGESTIONS FOR FUTURE RESEARCH IMPLICATIONS 66 BIBILIOGRAPHY 67 APPENDIX 83 iv
6 LIST OF FIGURES Figure 3.1 Theoretical Framework (page 29) LIST OF TABLES Table 1.1 Definition of SMEs in Malaysia (page 5) Table 1.2 Output and value added by sector (page 7) Table 3.1 Summary of Hypotheses (page 28) Table 3.2 Measures of e-commerce adoption factors (page 30) Table 4.1 Survey Collection Method (page 40) Table 4.2 Demographic Profile of the Respondents (page 41) Table 4.3 Profile of the Company (page 43) Table 4.4 Descriptive statistics of research variables (page 45) Table 4.5 Descriptive statistics of e-commerce adoption items (page 47) Table 4.6 Reliability Analysis of Research Variables (page 49) Table 4.7 Summary of Pearson Product-Moment Correlation Coefficients (page 51) Table 4.8 Regression Output on Independent Variables (page 52) Table 4.9 Regression Analysis of Variance (page 53) Table 4.10 Summary of Hypotheses Results (page 56) v
7 LIST OF SYMBOLS AND ABBREVIATIONS B2C DOI DOSM GDP ICT MITI NBI NKEA NTIC RM SME SME Corp TAM Business-to-customers Diffusion of Innovation Department of Statistics Malaysia Gross domestic products Information and Communication Technology Ministry of International Trade and Industry National Broadband Initiative National Key Economic Areas National Information Technology Council of Malaysia Ringgit Malaysia Small and medium sized enterprises Small and Medium Enterprise Corporation Malaysia Technology Adoption Model vi
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