Adoption of Electronic Data Interchange in Small-and Medium-Sized Enterprises

Abstract

As more and more small- and medium-sized enterprises (SME) adopt information technology (IT) in their daily business operations and even in their strategic planning, the positive impacts of IT are no longer a privilege of large organizations. However, there has been little research conducted and published on the adoption of electronic data interchange (EDI) in SME. Most previous studies on EDI in SME used the case study approach, thus limiting the generalizability of their findings. This study adopts the survey approach to conduct a large-scale empirical study of the key factors that influence EDI adoption in the SME context. A research model consisting of seven factors under three categories, namely characteristics of innovation, organizational context and external influence was proposed and tested against data collected from 644 SME using logistic regression analysis. The findings indicate that the critical factors that determine EDI adoption in the SME context are perceived direct benefits, perceived cost, IT knowledge, government incentives and enforcement, and trading partners’ influence. Implications for both research and practice are discussed.