An exploratory study of the extent of information technology adoption in SMEs: an application of upper echelon theory

Abstract

If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation. AbstractPurpose -The paper aims to investigate the effect of compositions of managerial/demographic characteristics of the top management team (TMT) on the extent of information technology (IT) adoption in small businesses (SMEs), where such strategic decisions made by TMT have direct and significant influence on all aspects of business operations and its competitive position in a market. Design/methodology/approach -Based on the upper echelon theory, the study formulated four hypotheses relating the compositions of TMT characteristics to the extent of IT adoption in different functional areas. Multiple regression analysis was employed to analyze the data. Findings -The age average and the education average of TMT in small businesses are significant predictors of the extent of IT adoption. However, the group heterogeneity (either gender or ethnicity), contrary to the prediction, has negative impact on the extent of IT adoption. Practical implications -The research findings indicate that the age and education composition of managers as current/future top management is critical to facilitate the extent of IT adoption in SMEs. Originality/value -The research contributes to the body of knowledge in IT adoption by complementing the results of prior research with the findings that the characteristic compositions of TMT affect the extent of IT adoption in SMEs, applying the upper echelon theory to examine issues surrounding IT adoption, and suggesting practical implications that SMEs could compose, educate, and rejuvenate their top management teams to achieve a high extent of IT adoption.

Computer literacy and use of ICT as key factors of micro-enterprise success

“…There is also signifi cant positive correlation between years of computer use and average annual turnover of enterprises (Pearson correlation coeffi cient is 0.292, p-value is 0.001). Additionally, this result is in accordance with the fi ndings of prior research [6] that the characteristics of decision makers infl uenced the decision over ICT adoption in SME, even though prior research was focused on team of managers.…”

“…Sometimes, the defi nition of a micro-enterprise depends on the industry [13]. In the USA the defi nition for small enterprises in most cases is less than 500 employees depending on industry [6]. Industry Canada's defi nition of a "small business" is a fi rm that has fewer than 100 employees [9].…”

Usage of Information and Communication Technology in Micro Enterprises in the Last Decade

“…Chuang et al (2009) had a sample of 97 enterprises in study of the extent of information technology adoption in SMEs. 126 enterprises were used to measure ERP adoption of small and medium enterprises (Shiau et al, 2009).…”

Analysis of Explanatory and Predictive Architectures and the Relevance in Explaining the Adoption of IT in SMEs

“…Recognizing that studies on Information Technology (IT) adoption differ in terms of the underlying theories and technologies investigated (Chuang et al, 2009), some of the theories have been improved and even integrated to provide stronger explanatory and predictive values. Perhaps because of researchers' customary inclination to the technology acceptance model (TAM), most existing Information Technology (IT) studies focused primarily upon reviewing literature on technology acceptance instead of providing a comprehensive review on broader issues (Williams, Dwivedi, Lal, & Schwarz, 2009).…”

“…Essentially, firms adopting IT infrastructures have the potential to build enduring customer relationships and achieve competitive advantage. Often, the exploitation of Information Technology (IT) opportunities is hampered or encouraged by some social, organizational, economic factors (Chuang, Nakatani, & Zhou, 2009;Esteves, 2009;Federici, 2009;Shiau, Hsu, & Wang, 2009). Small and Medium Enterprises (SMEs) are known to be highly idiosyncratic and complex in their social formation evidenced by their interpersonal relationships with owner families, friends, and other businesses that influence their corporate behaviors (Beckinsale, Levy, & Powell, 2006;Parker & Castleman, 2009).…”