Networks and Electronic Commerce Adoption in Small Businesses

Abstract

The adoption and diffusion of electronic commerce (e-commerce) in small businesses remains a critical area of investigation in information systems (IS) literature. A number of studies (Miles, Preece, & Baetz, 1999; Overby & Min, 2001) have suggested that in order to accommodate a technologically uncertain and globally focussed economy brought on by the advent of e-commerce, many small businesses are turning toward some form of alliance or network where the locus of the impact of change is interorganisational rather than organisational. Alliances or networks are formed entities that have a defined set of shared values, roles, responsibilities, and governance. Through involvement in such networks, small businesses not only find a ready source of technical and marketing expertise, but the very nature of the network “buffers” the impact of global market turbulence. This would suggest that belonging to a network is an important indicator of successful e-commerce adoption. However, a number of authors (Drakopoulou-Dodd, Jack, & Anderson, 2002; Dennis, 2000; McBer & Company as cited in Dennis, 2000) have found that many small businesses avoid network arrangements. Despite the widespread existence of networks, no research studies to date have formally compared networked and nonnetworked small businesses in relation to e-commerce adoption. This article presents the results of an exploratory study that aims to correct this oversight.