A Comparative Study of Small- and Medium-Sized Enterprises in Australia and Singapore: Overall Satisfaction of Electronic Commerce Implementation

A Comparative Study of Small- and Medium-Sized Enterprises in Australia and Singapore: Overall Satisfaction of Electronic Commerce Implementation

Sandy Chong (Curtin University of Technology, Australia)
DOI: 10.4018/978-1-61520-627-8.ch006
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Abstract

Since July 2003, Australia demonstrated the promotion of EC outside the country by forming an international EC partnership with Singapore. While both countries want to increase their international competitiveness by entering this as part of the bilateral free trade agreement, cultural barriers in EC implementation have to be considered and championed. The findings of the study seek to help companies that are embarking upon cross border activities by illustrating the differences in EC implementation in different countries. Results of preliminary interviews of small businesses in both countries show that respondents’ perceptions of EC are pre-dominantly positive. A regression analysis was carried out and 5 out of 19 influencing factors were found to make a significant contribution to the implementation of EC in Australia – observability, communication channel, customer pressure, supplier pressure, and perceived governmental support; while only 3 factors – firm size, perceived readiness, observability have significant impact in Singapore.
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1 Introduction

Electronic Commerce (EC) has changed and is still changing the way business is conducted around the world. The commercialization of the Internet and World Wide Web (WWW) has driven EC to become one of the most promising channels for inter-organizational business processes. Despite the economic downturn and the burst of the “dot-com” bubble, EC is expected to continue its significant growth. EC has emerged as a whole of business strategy that enables organisations to improve business processes and communication, both within the firm and with trading partners. In the US alone, the second decade of EC would boost online sales from $172 billion in 2005 to $329 billion in 2010 (Forrester Research, 2005), while Asia Pacific’s B2B EC is forecasted to grow rapidly at a Compound Annual Growth Rate (CAGR) of fifty-nine percent (IDC, 2004). Specifically in Australia, EC is estimated to be worth $11.3 billion dollars annually (Australian Government Information Management Office, 2005). Singapore also began its nationwide internet journey in the 1990’s with the launch of Singnet, its first commercial Internet service, in 1994. Currently, Singapore is ranked 12th in the world for Internet penetration, with a penetration rate of 60 percent (Internet World Stats, 2004) and it is predicted that this will continue to rise as Singapore's e-commerce revenue is forecast to hit some US$43 million in 2008.

EC has helped opened up the market, particularly on the supply- and demand-side for SMEs. Small firms are now able to compete in the same global arena that has previously only been the exclusive territory of multinationals corporations. This massive change for SME’s has resulted in a number of studies being undertaken by EC researchers worldwide. The strong interest is driven by two clear facts: (1) SMEs play a significant role in most countries’ economies, and (2) EC can provide SMEs with an unprecedented range of benefits, including a relatively inexpensive means of accessing global markets using a low cost communication medium (Al-Qirim & Corbitt, 2004; Chau.& Turner, 2002,). However, despite its obvious advantages, Australia and Singapore have been relatively slow in implementing EC in comparison with other countries (Department of Communications, Information Technology and Arts, 2004; Thong, 2001; Sensis, 2005; Singapore Enterprise, 2001). Prior research in Australia showed that most SMEs perceive the challenge of integrating EC into their business operations as risky, complex, time-consuming, and an expensive initiative (NOIE, 2002). In Singapore, it was indicated that merchants were uncertain about the business potential of the Internet as a medium for trading and payment (Lee et. al., 1997).

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