Misaligned Market: The Importance of Industry Context in Technology-Mediated Exchanges

Misaligned Market: The Importance of Industry Context in Technology-Mediated Exchanges

Ruey-Lin Hsiao (National University of Singapore, Singapore)
DOI: 10.4018/978-1-60566-138-4.ch022
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Abstract

This article examines e-marketplace adoption difficulties from a contextualist perspective. The analysis of industrial characteristics will unearth the adopter’s supply chain practices and the contextual features which are unfavorable for e-marketplace deployment. To gain a deeper understanding, this research examines an unsuccessful e-marketplace adoption for agricultural industry in China. The tension created by the these two incongruent contexts results in a misaligned market, as a free-market principle (assumed to be an integral part of the e-marketplace) is imposed on an agricultural market exchange which is characterized by a regulated business environment and a monopolistic market, and which emphasizes variances in product quality, tacit product specification, exclusive suppliers, and spotty purchasing. Practical and theoretical implications of the findings are discussed with reference to technology adoption and technology-organization alignment literature.
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Theoretical Basis

Business-to-business (B2B) e-commerce, better known as the e-marketplace, has recently captured the growing interest of executives (Ash & Burn, 2006; Kambil & van Heck, 1998; Johnston & Vitale, 1988). An e-marketplace is a technological platform from where buyers and suppliers participate in the exchange of products or services, and negotiate business transactions over the Internet (Kaplan & Sawhney, 2000). In an e-marketplace, suppliers can renew product categories in a real-time manner and engage in online exchanges with buyers. Buyers can also engage in online bidding to facilitate supply chain collaboration, thus reducing purchasing costs and improving transaction efficiency (Malone, Yates, & Benjamin, 1987). The case study of Li and Fung provides an excellent example of how the e-marketplace can be used to integrate a sophisticated global supply chain (McFarlan & Young, 2000).

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