Antecedents of B2B E‐Commerce Adoption and its Effect on Competitive Advantage in Manufacturing SMEs

• Published date: 01 September 2015
• Date: 01 September 2015
• Author: Haseba Hamad,Hatem El‐Gohary,Ibrahim Elbeltagi,Paul Jones
• DOI: http://doi.org/10.1002/jsc.2019

RESEARCH ARTICLE

Strat. Change 24: 405–428 (2015)

Published online in Wiley Online Library

(wileyonlinelibrary.com) DOI: 10.1002/jsc.2019

Copyright © 2015 John Wiley & Sons, Ltd.

Strategic Change: Briengs in Entrepreneurial Finance

Strategic Change

DOI: 10.1002/jsc.2019

Antecedents of B2B E-Commerce Adoption

and itsEffect on Competitive Advantage in

ManufacturingSMEs1

Haseba Hamad

College of Administration and Economics, Salahaddin University, Erbil, Iraq

Ibrahim Elbeltagi

Plymouth Business School, Plymouth University, UK

Paul Jones

Plymouth Business School, Plymouth University, UK

Hatem El-Gohary

Birmingham City University, UK and Cairo University Business School, Egypt

B2B e-commerce adoption enables SMEs to gain and sustain competitive

advantage in a dynamic competitive environment.

Manufacturing small and medium-sized enterprises (SMEs) represent the back-

bone of the sector that is a key component of the US economy, comprising 98%

of all manufacturing rms (Ezell and Atkinson, 2011). Furthermore, they employ

more than eight million workers, representing approximately 60% of the US

manufacturing labor force (Sperling and Mills, 2012). US manufacturing SMEs

play a vital role in export activity, whilst 96% of export rms have less than

500employees (Olive, 2008).

Business-to-business (B2B) e-commerce has become a key requirement for

servicing the business needs of SMEs eectively (Kartiwi and MacGregor, 2007;

Al-Bakri et al., 2010), and it can assist SMEs to attain a competitive advantage

over their competitors (Mustaa and Beaumont, 2004; Pavic et al., 2007). is

study denes B2B e-commerce as business activities fullled electronically in order

to enhance competitive advantage, related to selling, buying, exchanging, or trans-

ferring goods, services, and information among organizations. In the USA, B2B

e-commerce usage has become widespread within business practices (Martinsons,

2008). In comparison with other sectors, manufacturers made more widespread

use of B2B e-commerce whereby US manufacturers’ B2B e-commerce activities

account for 42% of total shipments, or $1862 billion (Sila, 2013).

1 JEL classication codes: L21, L81, M10, M15, M16.

The technology–organization–

environment (TOE) framework is

valid in illustrating B2B

e-commerce adoption levels by

US manufacturing SMEs.

Specic factors inuence the level

of B2B e-commerce adoption and

deployment impacts upon the

SMEs’ ability to attain competitive

advantage.

US manufacturing SMEs’

technological, organiational and

environmental factors have a

great impact on different levels

of B2B e-commerce adoption.

406 Haseba Hamad, Ibrahim Elbeltagi, Paul Jones, and Hatem El-Gohary

Copyright © 2015 John Wiley & Sons, Ltd. Strategic Change

DOI: 10.1002/jsc

Research aim and objectives

is study aims to investigate the adoption levels of B2B

e-commerce amongst manufacturing SMEs in the USA.

e investigation would provide a comprehensive under-

standing of how each level of B2B e-commerce achieved

a dierent degree of competitive advantage and how

dierent factors aect each level of adoption. e study

objectives are as follows:

• identify the factors aecting each level of B2B

e-commerce adoption in US manufacturing SMEs;

• identify the actual adoption level of B2B e-commerce

amongst US manufacturing SMEs;

• determine the eects of dierent levels of B2B

e-commerce adoption on competitive advantage of US

manufacturing SMEs.

The research question

From a theoretical perspective, the literature review dem-

onstrates that most prior studies (Grandon and Pearson,

2004) focused on a broad and generic view of the SMEs’

adoption of B2B e-commerce or on the relationship

between the adoption of information technology (IT) and

competitive advantage (Mustaa and Beaumont, 2004).

Some extant studies identied dierent levels of B2B

e-commerce implementation and adoption by manufac-

turing SMEs (Lefebvre et al., 2005; Elia, 2009). However,

they lacked the focus of identifying the factors that inu-

enced each level of B2B e-commerce adoption and did not

identify the competitive advantage achieved by adopting

each level that could guide both policy makers and owner/

managers of the SMEs in their investment decisions. is

study aims to ll this gap in the literature and meets the

call for further research in this area (Pickernell et al., 2013).

Theoretical background

Technology–organization–environment frameworks

e SME sector has been described as typically having a

high reliance on trade partners (Chwelos et al., 2001),

lacking technical knowledge and expertise (Barry and

Milner, 2002), and having insucient nance and limited

organizational planning capabilities (Raymond, 2001).

ese unique features of SMEs ensure that there is a need

for a comprehensive theory to understand the technology

adoption decisions and processes from a technological,

organizational, and environmental perspective (Duan

et al., 2012). Kuan and Chau (2001) and Chen et al.

(2005) suggest that the most important factors to adopt

dierent forms of IT in SMEs are technology–organiza-

tion–environment (TOE) factors. e TOE framework

has been the instrument in several prior empirical studies,

and it has been characterized by its ability to explain how

the factors may aect IT adoption by SMEs (Sila, 2013).

B2B e-commerce and competitive advantage

For SMEs, IT is one of the areas linked to competitive

advantage. One potential rationale for deploying IT is to

support a rm’s survival by employing Internet technolo-

gies to dierentiate themselves from competitors. ere-

fore, the rm’s management often consider IT as oering

a chance to strengthen their competitive advantage

(Remenyi, 1991). Several extant studies (Pavic et al.,

2007; Hazen and Byrd, 2012) have focused on the rela-

tionship between adopting IT and gaining competitive

advantage, and concluded that usage positively enabled an

advantage.

Research conceptual framework and hypotheses

is study developed a conceptual framework (Figure 1)

and hypotheses based on a literature review and the TOE

framework (Tornatzky and Fleischer, 1990). Based on the

conceptual research framework, a number of hypotheses

will be tested.

The relationship between technological factors

and levels of B2B e-commerce adoption

e technological factors indicate the attributes of the

technology to be adopted (Rogers, 1995). e technological