adoption

...

Aqualitativestudyofbusiness-to-busineslectronic

commerceadoptionwithintheIndonesiangrocery

industry:Amulti-theoryperspective

Abstract

Thisstudyexploresthebusiness-to-busineslectroniccommerce(B2B

EC)technologyadoptionexperienceoforganizationswithinthesupply

chainofthegroceryindustryinIndonesiausingamulti-theory

hamultiplecastudywitheightorganizations,it

providesacomprehensiveunderstandingoftheinfluenceofadoption

udyshowstheufulnessofcomplementarilydeploying

veraladoptiontheoriesandoffersimportanttheoreticaland

practicalimplicationsfororganizationsastheyextendtheirsupply

chainsglobally.

Keywords

•Electroniccommerce;

•Technologyadoption;

•Groceryindustry;

•Developingcountry;

•Supplychainmanagement;

•Qualitativestudy

...

uction

ElectronicCommerce(EC)isabroadconceptthatreferstothe

exchangeofproducts/rvicesandinformationviacomputernetworks,

includingtheInternet,theB2BECcontext,

adiverrangeoftechnologiesandinitiativeshavebeenintroduced.

ExamplesoftechnologiesincludeElectronicDataInterchange(EDI),

automaticproductidentification(barcode,RFIDtags),andElectronic

FundsTransfer,andexamplesofinitiativesincludecrossdocking,

VendorManagedInventory(VMI),ContinuousReplenishmentProgram

(CPR),andCollaborativePlanning,ForecastingandReplenishment

(CPFR).Organizationscanobtainsubstantialbenefitsfromtheir

investmentinECtechnologies,asECgenerallyenablesorganizationsto

improvereach,hepotentialofEC,

manycountriesworldwidehaverapidlyadoptedit,resultingina

significantgrowthofECindevelopedcountriesduringthelasttwo

decadesand,morerecently,indevelopingcountries.

Intheeraofglobalization,developingcountrieshaveplayedan

importantroleinworldtradeandcommercebecauoftheirlarge

pingcountriesare

definedascountrieswithalowtomiddleincomelevel,alowstandard

ofliving,restrictedtechnologyinfrastructureandlimitedaccessto

vancementsininformationand

...

communicationtechnologies(ICT),largeglobalorganizationsare

increasinglyextendingtheirsupplychainsacrossmultiplecontinentsin

hICTadoption,

developedcountriescantradewithdevelopingcountriesmore

efficientlyand,inturn,helpthodevelopingcountriesachievemore

sustainableeconomicgrowth.

However,duetodifferencesintheirsocial,cultural,economic,political,

legalandtechnologicalconditions,developingcountriencountera

tofproblemsandconcernsthatvaryconsiderablyfromthofaced

bydevelopedcountriesForexample,Hofstede'snationalculture

theorysuggeststhatdevelopingcountriesanddevelopedcountries

differgreatlyintheircharacteristics,whichmayaffecttheir

al

differencescapturedbyPowerDistanceandUncertaintyAvoidance

dimensionssuggestthatorganizationaltechnologyadoptionbehavior

isconstrainedsociallyasaresultoftheattachmentofmeaningsand

,organizations

operatingindevelopedcountries(withalowUncertaintyAvoidance

index)tendtostressbothtechnologicaldevelopmentand

technologicaladoptionmorethanorganizationsoperatingincountries

withahighPowerDistanceandlowtoleranceforambiguityand

herstudy,atthewayorganizations

...

u,phoneandfaxinChina(adevelopingcountry)andAustralia(a

developedcountry)islargelyinfluencedbythedifferenceinthe

UncertaintyAvoidancedimensionofculturaldifferencebetweenthe

ult,differenttsofapproachestotechnology

adoptionarerequiredtosuittheculturalandcontextualconditionsof

developingcountries.

However,atthisstage,thereremainsarelativelylimitednumberof

in-depthstudiesandunderstandingregardingtheadoptionofEC

technologiesbydevelopingcountries,despiteagrowingnumberof

technologypenetrationsthathavetakenplaceinthecountriesin

recentyearsAnunderstandingoftheadoptionofICT,inparticularEC

technology,bydevelopingcountriesisthusimportantforboth

er,thecontextualsituationsof

mple,thematurityof

theICTinfrastructure,e-commercereadiness,degreeofgovernment

support,andextentofbusinesscompetitivenessvarygreatly,notonly

betweenthedevelopedanddevelopingcountriesbutalsoamong

rmore,itwouldbeinappropriatetoassume

thatvariousdimensionsofnationalcultureremainsomewhatsimilar

,distinctculturaldifferencesare

,itcouldbearguedthat

qualitativestudiesfocusingone-commerceadoptioninsome

...

developingcountriesarenotnecessarilyreflectiveofthee-commerce

trendsandadoptiondynamicsofalldevelopingcountriesacrossthe

globe.

Inaddition,somenoticeablegapshavebeenidentifiedintheexisting

,inthecontextofdevelopingcountries,thereare

limitedempiricalstudiesonECtechnologyadoptionbylarge

rast,manystudiexplorethediffusionofEC

technologiesamongsmallandmedium-sizedenterpris(SMEs),

,mostofthestudies,especiallyinthe

SoutheastAsiaregion,exploreonlygeneralECtechnologyand

practices(includingBusiness-to-CustomersECandgeneralpractices).

OnlyahandfulofstudiesasssabroadrangeofECtechnologiessuch

asEDI,e-auctions,EFT,rmore,dueto

theexclusionofthestudycontext,therehavebeensomeconflicting

findingsregardingtheimpactofadoptionfactorsonactualadoption.

Inaddition,veralexistingstudiesaggregatetheadoptionexperience

acrossmultipleindustrieswithinacountryusingquantitativemethods.

Therefore,adetailedunderstandingoforganizations’adoption

ewauthorsfocusonaspecificindustry

andemployaqualitativemethod,forexample,UtomoandDodgson,

whoconcentrateonIndonesia'smanufacturingofindustrialproducts,

andKurnia,sting

...

qualitativestudiesonECadoptionarealsogenerallydescriptivein

lly,theyidentifyanumberofadoptionfactors,whichare

oftengroupedintotechnological,organizationalandenvironmental

contextsbutgenerallylacktheoreticalexplanationsoftheunderlying

mechanismsoftheinfluence.

Thus,insummary,wearguethatthereiscurrentlyalackofrich

understandingoftheB2BECadoptionphenomenonindeveloping

countriesduetothedominanceofquantitativestudiesandthelimited

,theadoptionprocessinvolves

dynamicinteractionsamongsocial,legal,economic,politicaland

technologicalfactorsthatcallformorestudiesinvolvingveral

theoreticalperspectivestobetterunderstandtheadoption

developingcountrymayhavespecificcontextualfactorsinvolving

differentdynamicsandinterplays,whichmayhavedifferingeffectson

-depthstudiesofhowB2BECtechnology

isadoptedinacontextthathasnotyetbeenthoroughlyinvestigated

thuscontributetothecurrentknowledgeinthisarea.

ewoftheIndonesiangroceryindustry

Indonesiahasmanynaturalresources,anditconomicpositionhas

onesianeconomyisranked16thonaglobal

...

scalebadonGDP,sia

hasbeenanimportanttradingpartnerformanycountries,including

China,India,icular,

foreignretailersquitenaturallyektodevelopaprenceinany

tion,givenyearsof

continuousimpressiveandsustainedeconomicgrowthinIndonesia

duringthe1990s,thegroceryindustryprentedtremendouspotential

forfuturegrowthintheeyesofforeignretailers.

StronggrowthinIndonesians’personaldisposableincomehasledto

steadyescalationingroceryretailsalessincetheendofthe20th

flectsasubstantialincreaintheminimumwage,high

inflationrates,siaisviewedas

amarketthatisclolyassociatedwithcontinuouconomicrecovery

2002,retailsalesinIndonesia

amountedtonearlyUS$7billion,andthectoremployed

approximately17.7%ofIndonesian'2012,groceryretail

salesinIndonesiaamountedtoapproximatelyUS$36billionandare

estimatedtoincreatoUS$iguresshowthe

potentialimpactofthegroceryindustryonIndonesia'soverall

economicsituationforyearstocome.

ThecurrentIndonesiangroceryretailmarketcanbedividedintothe

traditionalmarketformat,whichincludestraditionalstoresandwet

...

markets,andthemodernmarketformat,whichincludesminimarkets

(conveniencestores),supermarkets,nareas,

thehighconcentrationofdifferentretailtypeshasintensified

arkets,withtheirlargeproductofferingsof

approximately60,000items,arestronglycompetingwithsupermarkets

formarketshare,andbothareintightcompetitionwiththetraditional

ditionalmarketformat,however,continuesto

dominatetheruralmarket,wherecompetitionismuchlessinten.

Inthelastfiveyears,themodernmarketformathasbeenthefastest

the

periodof2004–2008,themodernmarketgrewbyasmuchas19.8%

peryear,arketscontinued

tohavethelargestshareofthemodernmarketupuntil2004,withupto

42.5%r,since2005,theIndonesian

modernmarkethasbeendominatedbyhypermarkets,whicharethe

2008,supermarkets

accountedforonly26.2%ofthemarketshare,followinghypermarkets,

whichhad41.7%ofthemarketshare,andminimarkets,witha32.1%

hreedifferenttypesofmodernmarketformats,the

hypermarketispredictedtobethestrongestretailmodelforthenext5

ermarket,alsowellknownasMassGroceryRetail(MGR),

istimatedtogrowfromthestartingpositionofUS$2.4billionrevenue

...

in2008toUS$luenceofthemodernmarket

formatsandMNChasgenerallydriventechnologyadoptionwithinthe

industry.

dyfindings

Inthisction,wedescribehowtheadoptionfactorscapturedinour

rearchframeworkdriveorinhibittheadoptionofvariousB2BEC

technologyinitiativescurrentlyadoptedbytheorganizationsinvolved

4summarizesfactorsaffectingtheadoptionofB2B

ctorisdiscusdbelow.

logicalcontext

Withinthetechnologicalcontext,thestudyfindingshighlightthree

salientfactorsthataffectadoption:perceivedbenefits,compatibility

ctorhasadifferentinfluenceonEC

haracteristics,suchascomplexityandrisks,donot

appeartosignificantlyaffecttheB2BECadoptionbytheparticipants

and,hence,arenotdiscusdinthisction.

3.1.1.(+)Perceivedbenefits

Withinthetechnologicalcontext,ourstudyindicatesthepositive

influenceoftheperceivedbenefitsoftheadoptedB2BEC

ganizationsfindthatthisisaverycrucialfactorin

...

the

perceivedbenefitsincludeaccuracy,speedandefficiency,whichall

enefitsarethe

maindriversbehindthepursuitofB2BECinitiativessuchasbarcode,EDI,

andcrossdocking.B2BECinitiativessuchasthehandheldPDAsystem

romspeedand

efficiency,participantsacknowledgedotherbenefitsofimplementing

theinitiatives,includingthefollowing:(1)abilitytocontroland

monitorhumanfactors,imposingdisciplineandstrictpolicytoensurea

sufficientlevelofsalesmenperformance,(2)abilitytoincrea

informationvisibilityforbothitsownemployeesandexternalcustomers,

and(3)abilitytomaintaingoodrelationshipswithtradingpartnersby

ingtotheManaging

Director,Manufacturer(CompanyC):

Weneedtodothingsmoreefficientlyandfaster.

Automation[theuofPDA]reduceshumanerrors,which

resultsinefficiencyandspeed,

,ithelpsto

trackdownalltheiractivitiesinthefield.

ManagingDirector,Manufacturer(CompanyC)

...

Astechnologyadoptionwouldtypicallyrequiresubstantialinvestment

capital,itisveryimportantfororganizationstoforeetheperceived

benefitstobegainedfromsuchaninvestment.