Influence of E-commerce on the Performance of SMEs
CHAPTERS ONE
Research Objectives
- To determine the influence ofE-Commerce on theperformance of SMEs in Imo State, Nigeria.
- To establish the extent to which SMEs inImo state, Nigeriahave implemented E-Commerce.
- To establish the drivers to the adoption of E-Commerce by the SMEs inImo State,Nigeria
- To establish the barriers to the adoption of E-Commerce by the SMEs inImo state,Nigeria.
CHAPTER TWO
LITERATURE REVIEW
THEORETICAL FRAMEWORK
Expectation-Confirmation Theory
This study is anchored on the expectation-confirmation theory (ECT). The expectation– confirmation theory (ECT) was advanced by Bhattacherjee (2001) as a way of understanding and predicting the users’ continuance intention toward new technologies. ECT argues that a consumer’s intention to use a service more than once is determined by the person’s level of satisfaction, which in turn is influenced by the consumer initial expectations (pre-purchase expectations) and the resultant feelings after consumption of the service. The discrepancy between initial expectations and perceived product/service performance (confirmation) influences the consumers’ decision to repurchase the product or not. Halilovic and Cicic (2013) argue that the according to ECM theory, the similarity between initial expectations and actual performance (confirmation) affects both perceived utility function and consumer satisfaction. Hence, the perceived usefulness of a service/product impacts on the satisfaction of a user which in turn determines continuance intention.
Lin and Hsieh (2007) further argue that expectation-confirmation theory suggest that consumer’s decision to continually use a technology, for example the e-commerce platform for a company, follows a procedural sequence to arrive at repurchase intention. The method of using e-commerce by a buyer starts before the actual purchase where consumers develop some expectation of the e-commerce platform or service. Afterwards, the user of the e- commerce form opinion concerning service or product performance compare it with their initial anticipation. Coursar, Hassanein, Head and Bontis (2012) note that the point where consumer expectation align with performance, influences the degree of satisfaction. Consequently, consumers whose needs were satisfied established a repurchase intention whereas dissatisfied customers cease their intention to repurchase the product in the subsequent periods. Klein et al. (2009) highlight that for e-commerce; the constructs that defines a consumer expectation include service assurance, reliability, empathy, and responsiveness. The decision by customers to use e-commerce platforms services is dependent upon the expectation that they have on the system that can be peroxide by reliability, security features, convenience, affordability and ease of use. Therefore, consumer happiness with the use of an E-Commerce system is influenced by the perceived utility and the service to be offered.
CHAPTER THREE
RESEARCH METHODOLOGY
Research Design
The design employed a descriptive research design. The process not only involves collecting and tabulation of data but also an attempt to obtain facts about the current state of affairs, (IOSR Journal of Research & Method in Education). In addition, descriptive design facilitates the process of acquiring individual’s behaviour, real perceptions, attitudes and or standards in determining and reporting the nature of a condition about the target population. The research design was appropriate in this case because it intends to establish the individual’s real perceptions to describe the way the situation is in relation to associated target population and more specifically being a social science research.
CHAPTER FOUR
DATA ANALYSIS, PRESENTATION AND DISCUSSION
Demographic Information
CHAPTER FIVE
SUMMARY OF FINDINGS CONCLUSION AND RECOMMENDATIONS
Summary of findings
The study clearly finds that respondents had a high level of education starting from Diploma and higher. The study also finds that most of the targeted SMEs have been in operation for a long period of time, above five years. The Head of ICT departments that were targeted by the questionnaire have worked for the firms for more than five years which gives them the required history to be able to provide credible answers. The study has established that most SMEs have adopted E-commerce and they use it to; track inventory from purchase to sale, receive orders, make enquiries, list and display inventory, fulfil orders, facilitate payments and engage customers. Using a scale of 1 to 5 where 1 was ‘not at all’ and 5 was a ‘great extent’ of adoption, the study found out that the extent of adoption of E- Commerce in these firms ranged from ‘moderate extent to a ‘great extent’.
The study revealed that the deployment of ecommerce is driven by the advantages it brings to the operations of the firm, compatibility of the system with the existing ones in the firm and external pressures whereby competing firms have adopted the same. Reduction of costs is also established to have led the firms to adopt E-commerce as well as the ease of use of the E-commerce platform. The size of the organization moderately leads to adoption of E- Commerce. Further the availability of technical staff to rollout E-commerce and the level of external infrastructure development such as internet and smartphone penetration motivates the adoption of E-Commerce. Adoption is also driven by the need to enhance security of customer transactions and the high level of readiness by customers to use the ecommerce platform.
This study has established the barriers to the deployment of E-Commerce by the SMEs are; Resistance by employees to adopt to the system, inadequate financial allocation and staff to support the system and lack of technical know-how to deploy the system. Lack of proper infrastructure to support the system and lack of clear ICT Policy to govern the system are also barriers to adoption. Lack of top management support, management approval and ownership by management were not barriers to e-commerce adoption.
The study has established that there’s a strong relationship between the adoption of E- Commerce and the performance of the SMEs in Imo state, Nigeria. It was established that the adoption of E-Commerce to facilitate payments, to list and display available inventory to customers, to track inventory from purchase to sale, to make enquiries, to receive orders, to fulfil orders, to engage customers, accounted for 85.8% of the performance.
Conclusion
The study concludes that the adoption of E-commerce by SMEs, leads to an improvement in performance. It is evident that there’s a strong relationship between performance and adoption of E-Commerce to; facilitate payments, track inventory from purchase to sale, list and display available inventory to customers, to engage customers, make enquiries as well as receive and fulfil orders. This relationship accounted for 85.8% of the performance of the SMEs in Imo state, Nigeria.
The decision to adopt E-commerce is driven by; the perceived advantages it brings to the operations of the firm, the compatibility of the system with the existing ones in the organization and institutional pressures whereby competing firms have adopted the same. Reduction of costs also motivates the firms to adopt E-commerce. The size of the organization moderately leads to the adoption of E-commerce. Further the availability of technical staff to rollout E-commerce and the level of external infrastructure development such as internet and smartphone penetration drives the adoption of the E-Commerce in most SMEs. The need to enhance security of customer transactions and the high level of readiness by customers to use Ecommerce platforms, are other key driving factors.
Lastly the study concludes that the main barriers are; resistance by employees to adopt to E- commerce, inadequate financial allocation and staff to support the system and Lack of technical know-how to deploy the system. Lack of proper infrastructure to support the system and lack of clear ICT Policy to govern the system is also a barrier to some firms. Lack of top management support, management approval and ownership by management were not barriers to adoption of E-commerce.
Recommendations
The researcher recommends that SMEs need to incorporate all the aspects of E- commerce into their overall adoption strategy. The SMEs need to find out ways of encouraging employees to make use of E-commerce. If employees are encouraged and motivated by the top management to use E-commerce, the adoption becomes much easier. It is therefore recommended that the management of SMEs need to incorporate motivation and incentive into the overall E-commerce strategy. It is also incumbent on the employees of these firms to enhance their skills by taking lessons on E-commerce and to keep abreast with emerging technologies to remain relevant in the ever-changing modern workplace.
Since E-commerce is increasingly becoming an important and indispensable tool for conducting business, the government should come up with relevant policies that support its adoption by eliminating the known barriers to adoption that are related to policy and regulation. In addition, owners and employees of SMEs should be encouraged to regularly attend workshops and courses to constantly improve on their technical skills and knowledge of E-commerce.
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