Perceived E-Readiness Factors in E-Commerce Adoption: An Empirical Investigation in a Developing Country

Alemayehu Molla and Paul S. Licker
International Journal of Electronic Commerce,
Volume 10, Number 1, Fall 2005, pp. 83.

Abstract: This study explores the factors that affect e-commerce adoption in a developing country. It proposes a research model, based on perceived organizational e-readiness (POER) and perceived environmental e-readiness (PEER), that encompasses innovational, managerial, organizational, and environmental characteristics as determinants of e-commerce adoption and institutionalization. Based on survey data from 150 businesses in South Africa, it finds that initial e-commerce adoption is explained more by POER than by PEER, but PEER factors and POER commitment and governance variables explain the extent of institutionalization of e-commerce. The model links e-readiness to e-commerce adoption and suggests that a combination of PEER and POER factors affect e-commerce adoption. By implication, a multilevel model is essential to explicate the diffusion of e-commerce in developing countries. The results indicate that firms in developing countries should pay attention to both organizational and environmental considerations when making e-commerce adoption decisions. They also imply that investment in infrastructure development by governments and other agencies should go hand-in-hand with schemes for business development and managerial improvement at the organizational level.

Key Words and Phrases: Developing countries, e-commerce, e-readiness, innovation adoption, PERM.