Factors affecting the adoption level

of C-commerce: an empirical study

Alain yee-loong chong keng-boon ooi
INTI International University College Jalan University
Putra Nilai, Negeri Sembilan Perak, Malaysia
Binshan Lin Murali Raman
Louisiana State University in Shreveport Multimedia University
Shreveport, LA Selangor Darul Ehsan, Malaysia

Abstract could be solved via strategic SCM through the implementation of

Information Technology (IT) [15].
The major objective of this paper is to examine the determinants Recent literature on IT and SCM focus on IT and especially
of collaborative commerce (c-commerce) adoption with special Internet tools that support collaborative SCM known as
emphasis on Electrical and Electronic organizations in Malaysia. Collaborative Commerce (c-commerce) [8], [20]. C-commerce
Original research using a self-administered questionnaire was is defined as a set of electronically-enabled collaborative inter­
distributed to 400 Malaysian organizations. Out of the 400 ques­ actions between an organization, its suppliers, trading partners,
tionnaires posted, 109 usable questionnaires were returned, customers and employees, and also leverages the internet to
yielding a response rate of 27.25%. Data were analysed by using create and maintain an interactive business community of
correlation and multiple regression analysis. employees, trading partners, suppliers and customers [13]. Unlike
External environment, organization readiness and informa- e-commerce, c-commerce covers exchanges of information and
tion sharing culture were found to be significant in affect- ideas between trading organizations and within the organizations,
ing organ­izations decision to adopt c-commerce. Information and allows them to collaboratively design, develop, build and
sharing culture factor was found to have the strongest influ- manage products through their life cycle. It enables companies
ence on the adoption of c-commerce, followed by organiza- to automate information flows within a multi-channel distribution
tion readiness and external environment. Contrary to other tech- network.
nology adoption studies, this research found that innovation An effective and efficient supply chain will increase the
attributes have no significant influence on the adoption of competitiveness and the survival of organizations [44]. As such,
c-commerce. the implementation of an effective SCM via IT technologies
In terms of theoretical contributions, this study has ex- such as c-commerce tools will enable the industry to gain and
tended previous researches conducted in western countries and maintain its competitive advantage. Most existing literature on
provides great potential by advancing the understanding be- the adoption issues on c-commerce technologies or collaborative
tween the association of adoption factors and c-commerce supply chain were mainly conducted in western countries such
adoption level. This research show that adoption studies could as the United States and United Kingdom. Previous technology
move beyond studying the factors based on traditional adoption adoption literatures have studied the factors affecting the
models. Organizations planning to adopt c-commerce would implementation of technologies based might not be able to fully
also be able to applied strategies based on the findings from this provide the reasons for c-commerce adoption as c-commerce have
research. different characteristics with existing information systems (i.e.
Keywords: Collaborative Commerce, Technology Adop­ c-commerce implementation requires the sharing of information
tion, Collaborative Supply Chain between the trading partners). Therefore in order to bridge the
gap and provide companies with practical assistance of adopting
c-commerce, this research will examine the adoption factors that
Introduction influence the implementation of c-commerce among Malaysian
E&E companies.
Supply Chain Management (SCM) is defined as the systemic, The paper proceeds as follows: In the next section, the theories
strategic coordination of the traditional business functions within laid down in the literatures of IT adoption theories and the link
a particular company and across businesses within supply chain, between E&E organizations and c-commerce adoption are
for the purposes of improving the long-term performances of reviewed. In the following section, the hypotheses development
the individual companies and the supply chain as a whole [8]. and development of conceptual framework are presented. The
Traditionally, the supply chain faces common challenges such next section provides information concerning the data used in the
as the forecasting of demand and supply of products resulting in study, including descriptive information on the sample drawn out
the inability to meet demand for certain products while having of Malaysian E&E companies as population. Finally, the results
oversized and expensive inventories for other products [49]. are discussed followed by research limitations, conclusions and
However, many of the problems found along the supply chain implications, and recommendations for future research.

Received: October 15, 2008 Revised: January 7, 2009 Accepted: January 27, 2009

Winter 2009 Journal of Computer Information Systems 13

 Literature Review on the other hand, also evaluated an organization’s decision
and Hypothesis Development to implement an innovation based on 1) technological (i.e. the
technologies relevant to the organization) 2) organizational
C-commerce adoption attributes (i.e. company size, resources available, quality of
human resources) and 3) environmental factors (i.e. business
Existing technology adoption literatures on EDI provided environment of the organization).
strong theoretical foundation for the studies of c-commerce Although literatures on IT adoptions were based on the models
and adoption as these two technologies involve IT support for mentioned above, for IT technologies with unique attributes, the
relationships among established business partners [6]. A review adoption factors might be different from findings based on these
on previous empirical studies on adoption of EDI technologies models [33] [47].
have shown that most of the studies on EDI adoption derived C-commerce is different from existing IT technologies
from theories such as Innovation Diffusion Theory [41] and due to the fact that c-commerce requires the co-adoption of
Technology-organization-environment model [18], [49]. more than one organization, and there is a need for a change in
The dependent variable in this study used the adoption level organization mindset in terms of sharing information. As such, in
of the c-commerce tools. The adoption level was modified from order to understand what will encourage the implementation of
assimilation level used in existing literatures [11], [12], [28]. The c-commerce, there is a need to develop a new technology adoption
c-commerce tools were modified from [3] which identified the model. According to [39], although models such as Innovation
e-Collaboration tools studied and applied to the supply chain of Diffusion Model and Technology-organization-environment
telecommunication industry. The c-commerce tools are listed and have served as a theoretical basis to many adoption studies,
defined in Table I. the model “needs to be enriched when the innovation relate to
complex technologies with an interorganizational locus of impact,
Factors affecting the adoption of collaborative for which adoption decisions are linked (e.g. when imposed
commerce technologies in Supply Chain by business partners) and when the innovation are adopted by
organizations” [39, p. 412]
Based on existing studies on using Innovation Diffusion This study thus focused on innovation characteristics [28],
Theory [40] and Technology-organization-environment model [33], [40], [43], external environment characteristics [28], [18],
[18], [49], the three main variable categories that can influence organizational readiness characteristics [18], [27], [28], [35],
the adoption of IT innovations in organization can be summarized [36], [43] and an additional new factor in adoption study called
as environmental characteristics, innovation characteristics, and information sharing culture characteristics [1], [2], [16], [41].
organization characteristics [19]. In Innovation Diffusion Theory,
an organization’s decision to implement an IT technology could Innovation Factor
be influenced by the innovation’s characteristics such as its
relative advantage, compatibility, complexity, trialability, and One of the most frequently studied factors in IT adoption
observability. The Technology-organization-environment model studies is the Innovation factor. Shah Alam [42] found that

TABLE I. Definitions of c-commerce tools (Source: Adapted from [3])

C-Commerce tools Definitions
Direct procurement tools Direct procurement tools that will forward purchase orders (POs) to pre-qualified suppliers.
Replenishment tools The tool will drive an ordering system from the shop. When materials are needed on the pro-
duction line, an order will be placed through the replenishment system.
Projected Shortages tool This tool will scan the buyer’s production plan to project expected material shortages. The tool
will also provide real-time information to manufacturing and supply management units.
Delivery and tracking tool This tool will generate a payment and a delivery request automatically when a product goes
from suppliers to its customers. It can also collect shipping information from third party logis-
tics provides.
Design tool Enables the use of interactive engineering drawing and storage of CAD designs by all the key
stakeholders.
Supply chain planning Exchanges the forecast information provided by both the buyer and supplier.
Forecasting tool
Capacity planning tool Determines the amount of capacity required to produce.
Business strategy tool Collects and shares the actions that need to be taken to support the objectives and mission of
the supply chain.
Rosetta Net standards Standard that is based on XML and defines message guidelines, business processes interface
and implementation frameworks for interactions between companies in the supply chain.
E-Hub, E-Marketplace, E-Exchanges Internet platform where firms register as sellers or buyers to communicate and conduct busi-
ness over the Internet.

14 Journal of Computer Information Systems Winter 2009

there is a significant relationship between innovation factor Organization readiness
and adoption of e-commerce in Malaysian E&E companies.
Innovation characteristics are also studied as c-commerce is The organization readiness construct is used to assess whether
different from many existing technologies such as EDI and the organization has the necessary attributes that ensure the
e-commerce, and thus might give different results from previous overall readiness towards adopting c-commerce in the supply
studies. For example, Lin [24] in his study of innovation chain. The top management support is an important factor in
characteristics on e-business implementation success, suggested determining whether the company can successfully adopt the
that e-business may have features which are new when compared innovation. Result from [27] also showed that top management
to previous generations of technology innovations, thus the support is able to differentiate between adopters and non-adopters
effects of innovation characteristics deserved attention that of e-commerce. Organization readiness is also important from
have not been fully understood in the e-business adoption [24]. a resource point of view. The resources include both from a
E-business when compared to traditional information systems financial as well as technical standoff [28]. Financial feasibility
is “complex, emerging technologies that can provide a wide and technical feasibility of the organization include conducting
range of functionality ranging from developing online business cost-benefit analysis, forecasting total cash expenditures, and
processes to facilitating cooperation with customers and business estimating the indirect impact of the c-commerce (product costs,
partners” [24, p. 62]. process re-engineering efforts, etc.) [28]. Technical feasibility
For this research, the variables that are included under include assessing skill sets of the IS staff, identifying infrastructure
Innovation construct include relative advantage, compatibility, enhancements necessary to accommodate the new technology,
and complexity. Relative advantage is the degree to which and evaluating and prioritizing which shared business processes
c-commerce is perceived as being better than its precursor. should be automated [28]. As the implementation of c-commerce
The organizations which want to adopt c-commerce would is a long term project for companies as they have to continually
have seen that the technology has direct financial and opera- increase their level collaboration, and continually increase the
tional benefits over previous ways of performing the same tasks number of suppliers or buyers in the collaboration. C-commerce
in the supply chain. Compatibility assesses the compatibility is also a technology that requires an organization to plan, commit
of the c-commerce with the existing IT infrastructure and work and execute according to requirements established with trading
procedure needs of the company. Complexity is the degree to partners. As such, it requires evaluating top management’s
which c-commerce is perceived as relatively difficult to under- support, financial and technical feasibility [18].
stand and use by the organization. Accordingly, we hypothesize Project champion appointment and characteristics is also
that: included in organization readiness attribute. This attribute will
look at whether the organization has appointed a project champion
H1: There is a positive and significant relationship between and the experience and IT background of the project champion.
innovation and the adoption level of c-commerce. Organization attributes such as top management support [36],
[48], Feasibility [18], [28] have been considered in previous
research and found to be significant. Therefore we hypothesize
External Environment that:

From the review of existing literature, external environmental H3: There is a positive and significant relationship between
constructs have been widely studied and found to be significant organization readiness and the adoption level of c-
in many IT adoption/diffusion studies [6],[18],[9],[21],[28]. In commerce.
the existing literature, the majority of the studies were conducted
using EDI technologies where the pressure to adopt the technology Information Sharing Culture
usually come from one or more dominant firm. However, in the
current business environment of the E&E industry, the competition The information sharing construct is used to assess whether
is more of an industrial group versus another industrial group the organization has the necessary information sharing attributes
[28]. As such, the perceived pressure on the company to adopt for the overall readiness towards adopting c-commerce in the
c-commerce in the supply chain would be felt from the entire supply chain. Sharing of information is important as the success
industry. Another attribute in the environmental factor used in of a firm’s SCM would depend upon the accuracy and velocity
this study is the expectations of market trends of the c-commerce of the information which every business partner provides [23]
technology [8], [28]. [52]. In [1] the authors called for a collaborative culture in order
This study focused on the E&E industry which has to ensure the successful implementation of collaborative supply
characteristics that is different from other industries. The impact chain. In this study, Information Sharing culture is created because
from the increased in processing power of semiconductors for past adoption models might not be able to fully explain all the
example, means there is an intense pressure on the organizations factors due to c-commerce’s needs for companies to change their
to reduce cost. The competitive pressure and the expectations mindsets on information sharing. As such, Information Sharing
in the market trends of c-commerce in the industry can force Culture construct is created to determine if the organization
companies into adopting c-commerce technologies in SCM to has the attributes to share information which is necessary for
gain competitive advantages over their rivals. Given the existing the successful implementation of c-commerce. The information
literature, we hypothesize that sharing culture attributes include trust, information distribution
and information interpretation.
H2: There is a positive and significant relationship Trust has been increasingly an important factor in success of
between external environment and the adoption level IT technologies such as e-commerce [38]. Trust has been studied
of c-commerce. in relation to EDI and E-Business adoption and it is an important

Winter 2009 Journal of Computer Information Systems 15

factor in explaining interorganizational relationship [41], [45]. and c-commerce adoption. The link between adoption factors
When business partners collaborate in their supply chains, and c-commerce adoption are shown in Figure 1. The adoption
an organization that trusts its partners is more likely to reach factors in this research framework are independent variables
consensus in terms of achievable benefits by c-commerce [41]. and c-commerce adoption is a dependent variable respectively.
Existing studies on SCM have mentioned that the success of SCM This research is situated in the context of limited adoption of
is built on a foundation of trust [22]. Trust is able to contribute to c-commerce and the evidence of opportunities for competitive
the long-term stability of an organization and is conveyed through advantages gained through their application for a collaboration
faith, reliance, belief or confidence in the business partner and supply chain. The model suggests that the greater the extent to
is viewed as a willingness to forego opportunistic behaviour which these adoption factors are present; the higher will be the
[46]. Trust is thus the belief that the supply chain partner will adoption of c-commerce in the Malaysian E&E organizations.
act in a consistent manner and do what he/she says he/she will The purpose of this study is thus to answer the following
do. Due to trust, supply chain partners will be more willing to research questions.
share information about future plans and designs, competitive
forces, and R&D. The same can be said of c-commerce as when RQ (1): What are the determinants towards the adoption
business partners want to adopt c-commerce in their supply chain of c-commerce within the Malaysian E&E
collaboration, an organization that trusts its partners is more likely companies?
to reach consensus in terms of achievable benefits by c-commerce RQ (2): Which adoption factors have greater association
[34] [41]. with c-commerce adoption within the Malaysian
With the implementation of c-commerce, information will be E&E companies?
exchanged. Information raises the issues such as in what format
should the information be sent, for what purposes, how they
can be processed etc. Two variables used in [17] are applied to
information sharing culture. They are information distribution Innovation Attributes
and information interpretation. • Relative advantage
Information distribution refers to the process by which an • Compatibility
organization shares information among its units and members, • Complexity
thereby promoting learning and producing new knowledge or
understanding. Greater distribution of information will lead to more
information sharing, which in turn leads to greater organizational
learning [17]. Thus companies that have been using Information Environmental
systems/Internet technologies to distribute information are more • Expectations of market trends
likely to have an information sharing culture in place. They are • Competitive pressure
more likely to adopt c-commerce technologies with their supply
chain partners to share information. C-Commerce
In order for information to be shared, the information must Adoption Level
be interpreted. Information interpretation is the “process by Information Sharing Culture
which distributed information is given one or more commonly • Trust
understood meanings. Sense-making or the formation of meaning
• Information Distribution
is called procedural knowledge [10]. The aim of many IOS
standards such as RosettaNet helps interpret information for • Information Interpretation
the supply chain members. As mentioned earlier, RosettaNet
standards enable companies to communicate electronically
with other companies using the same e-business standards. By Organization readiness
defining the technical terms as well as the business processes that • Top management support
are used, the risks of different supply chain partners interpreting • Feasibility
the information differently is reduced. In order for information • Project champion characteristics
sharing to occur between companies and their partners, methods
of interpreting information through using IOS standards, as Figure 1. Model of the adoption factors of c-commerce in
well as willingness to set up mechanisms for interpretation of Malaysian E&E organizations
information to be shared through a consistent field terminology
and consistent business definitions should be considered. Based
on the variables discussed for information sharing construct, we
hypothesize that: Methodology
Background
H4: There is a positive and significant relationship
between information sharing and the adoption level A survey instrument was developed for the testing of the
of c-commerce. hypothesis developed using data gathered from a review of
current literature combined with in-depth case studies with two
Research Framework major E&E companies in Malaysia together with ten of their
suppliers. The focus of these case studies was to refine the
Based on the above literature review, a research framework is variables developed from the literature review, gain a greater
developed to examine the relationship between adoption factors understanding of the most important issues with regard to

16 Journal of Computer Information Systems Winter 2009

c-commerce adoption and non adoption, as well as improving the organization, 38 (34.9%) are MNCs, and 18 (16.5) of them
viability of the questionnaire. are joint venture organizations. Most of these companies have
been operating for more than 10 years with 84 (77.1%) of them
Sampling and Data Collection operating in Malaysia for more than 10 years.
In terms of organization size, 57 (52.3%) of these organizations
The target population of this study were E&E companies in have more than 150 employees, 30 (27.5%) of them have between
Malaysia. The target population of this study is E&E companies 51 and 150 employees, and 22 (20.2%) of them have 50 or less
in Malaysia. Samples were randomly drawn from the database employees.
of Federation of Malaysian Manufacturer (FMM) 2007 listed
members of E&E manufacturing companies in Malaysia. As
the FMM directory consists of manufacturing companies of Normality Test of
various sizes based on their revenue and employee size as well c-commerce Adoption Level
as having companies which are local, joint venture and MNCs, it
is viewed as a valid representation of the entire Malaysian E&E As the data sets was larger than 50, Kolmogorov-Smirnov’s
organizations in Malaysia. test is applied to test for data normality among the inde-
The unit of study for this research was the organizations. The pendent variables [14]. The Kolmogorov-Smirnov statistic
survey was administered to 400 managers and executives from with Lilliefors significant level for testing normality is ap-
the purchasing or IT departments of the FMM listed organizations. plied to test the normality of c-commerce adoption level.
The mail survey was the main form of data collection. There The significant level for the Kolmogorov-Smirnov test shows
were 120 responses received, indicating an estimated response a P value of 0.20 which is more than 0.05, hence normality is
rate of 30 percent. However, only 109 of the questionnaires were assumed.
usable.

Variable Measurement Scale reliability and Factor Analysis

Independent Variables The reliability of the questionnaire was tested according to

Cronbach Alpha measurements [4]. The reliability coefficients
The four independent variables used in this study (i.e. (Alpha) of each element of adoption factors for c-commerce
innovation, environmental, organization and information sharing were as follows: Innovation (0.9268); Environmental (0.9357);
culture) consist of 11 items. A total of 38 questions captured the Information Sharing Culture (0.9267); Organization Readiness
four adoption factors under investigation. Responses to the items (0.9679). The reliability coefficients of all the five adoption
were made on a 5-point Likert Scale ranging from 1 = strongly factors for c-commerce were above 0.70, which concurs with the
disagree to 5 = strongly agree. suggestion made by [30].
Factor analysis was conducted to evaluate construct validity.
Dependent Variable: Although the survey used in this research is adapted from previous
C-commerce adoption Level studies, parts of the survey included new items. Furthermore, the
adapted survey has not been applied in the context of Malaysian
The adoption level was measured using 5 items modified E&E organizations. Therefore, exploratory factor analysis is
from the use of assimilation level from [11], [13] [28]. The applied to this research.
adoption level here is measured using the items from whether Principle component analysis is applied to determine how
the organization has 1 = deployed, 2 = committed, 3 = shown and to what extent the items are linked to their underlying factors
an interest, 4 = aware and 5 = unaware of the c-commerce tools [51]. Principle component analysis is able to identify whether
given. the selected items cluster on one or more than one factor. Factor
The c-commerce tools used in this research were modified loadings are applied to present these relations. According to
based on the recommendations of senior executives from two [14], factor loadings greater than 0.50 is considered to be very
major E&E companies in Malaysia. The 10 c-commerce tools used significant. Thus a factor loading of 0.50 was used as the cut off
in this study were direct procurement tools, replenishment tools, point.
projected shortages tools, delivery and tracking tools, design tools, Latent root criterion was applied to determine if the items are
Supply chain Planning and Forecasting tool, Capacity planning loading into one factor. Factors which have eigenvalues values
tool, RosettaNet standards, E-Hub, and Business Strategy tool. which are more than 1 are considered significant while those that
All the adoption level questions on the c-commerce tools added have eigenvalues of less than 1 are considered insignificant and
together bring the total points to 50. The mean was calculated therefore were disregard.
giving a maximum mean score of 5 which signify a high adoption From Table II, all items had high factor loadings of greater
level of C-Commerce tools while a minimum mean score of 1 than 0.50 for factor 1. When items in a scale loaded on more
signify low adoption level C-Commerce tools. The reliability than one factor, varimax rotation was applied. The factor
coefficient for the scale was 0.94. analysis showed that except for innovation, items in 5 of
the 6 scales formed a single factor. For Innovation scale,
Data Analysis two factors emerged based on the rule that the eigenvalues
are grater than 1 [14]. Based on the principal component
Profile of organizations analysis, only factors with eigenvalues that are more than 1
are considered as significant while eigenvalues less than 1 is
There were total of 109 respondents. 53 (48.6%) are local considered as not significant and thus are disregarded.

Winter 2009 Journal of Computer Information Systems 17

 Table II. Exploratory Factor Analysis Results

Scales Factor Eigenva Factor
number lues Loadings
Item 1 Item 2 Item 3 Item 4 Item 5 Item 6 Item 7 Item 8 Item 9 Item 10 Item 11 Item 12 % of
variance
Innovation 1 8.201 .859 .857 .855 .851 .845 .836 .834 .824 .823 .812 .709 .723 68.34
2 1.088 -.309 -.175 .255 -.301 -.319 -.181 .389 .434 -.135 .470 .146 -.268 9.06
Organization 1 7.175 .938 .929 .921 .920 .917 .884 .873 .831 .815 79.73
External
environment 1 3.981 .923 .920 .894 .871 .851 79.16
Information
Sharing
Culture 1 4.857 .900 .894 .889 .875 .842 .823 .816 .805 .803 .794 0.784 0.714 60.71
c-commerce
adoption
level 1 7.175 .938 .929 .921 .920 .917 .884 .873 .831 .815 79.73

Table III lists the rotated factor matrix for scale 1 (Innovation). be divided into two factors if they can be supported by literature.
Based on the Table III, Items 1 to 7 forms a factor which can be The contents of items in the innovation factor were carefully
constituted as “ease of implementation”. The other items in scale examined and it was clear that the aim of using relative advantage
1 formed another factor which can be constituted as “relative information was part of the innovation’s attributes. Furthermore,
advantage”. as relative advantage has been studied under innovation factors
in most existing literature, and relative advantage is indeed an
attribute of the innovation factors, the construct of innovation was
Table III. not divided into two constructs [51].
Factor Matrix for Scale 1 (Innovation)
Component Correlation analysis: Relationships between the Variables
1 2
The correlation matrix in Table IV indicated that the adoption
Item 1 .849 .336 factors were positively and strongly correlated with c-commerce
Item 2 .846 .318 adoption level. There was a significant positive relationship
between environmental factor and c-commerce adoption level (r
Item 3 .838 .336 = 0.791, p < 0.01), organization readiness factor and c-commerce
Item 4 .759 .435 adoption level (r = 0.820, p < 0.01), information sharing culture
and c-commerce adoption level (r = 0.807, p < 0.01) and innovation
Item 5 .747 .416
factor and c-commerce adoption (r = 0.725, p < 0.01).
Item 6 .720 .276 The correlation coefficients between the independent variables
were less than 0.9, indicating that the data was not affected by
Item 7 .707 .442
a multicollinearity problem [14]. These correlations were also
Item 8 .300 .889 further evidence of validity and reliability of measurement
Item 9 .332 .869 scales used in this research. The results indicated that the most
important adoption factor affecting c-commerce adoption level
Item 10 .369 .843 was organization readiness (i.e. with the highest scores of
Item 11 .474 .756 correlation), which proved that where organization readiness
was perceived as a dominant adoption factor, improvements in
Item 12 .497 .631 c-commerce adoption level was significant.

Multiple Regression Analysis

However, although two factors emerged for Scale 1 (Inno­
vation), this result was obtained based on the rule of eigen- Multiple regressions were employed to test the hypothesis.
values greater than 1. As [25] stated, results obtained from sta- Multiple regression analysis according to [14] is applied to
tistical data analysis should be interpreted with caution as there analyze the relationship between a single dependent variable
may be temptation to overstate statistical findings. The interpre- and several independent variables. As such, multiple regression
tation should be based on the total view of research content as well analysis was selected and viewed as the best method in this study.
as the sampling frame. As cited in [51], given that the eigenvalues The summary of results analysis is depicted in Table V.
for Factor 1 is only 1.088 as shown in Table II, it is just slightly The Durbin-Watson of 1.822 falls between the acceptable
greater than 1 and it is possible that the construct does not need to range (1.5 c<cD<2.5) indicating no autocorrelation prob-

18 Journal of Computer Information Systems Winter 2009

 Table IV. Correlations between adoption factors and c-commerce adoption level
Information C-Commerce
Environmental Sharing Culture Organization Innovation Adoption level
Environmental 1 .820 (**) .889 (**) .825 (**) .791 (**)
Information
Sharing Culture .820 (**) 1 .877 (**) .812 (**) .807 (**)
Organization .889 (**) .877 (**) 1 .862 (**) .820 (**)
Innovation .825 (**) .812 (**) .862 (**) 1 .725 (**)
C-Commerce
adoption level .791 (**) .807 (**) .820 (**) .725 (**) 1

** Correlation is significant at the 0.01 level (2-tailed).

Table V. Regression analysis of adoption factors on c-commerce adoption level

Independent variable Beta t C-Commerce adoption level significance Results Tolerance VIF
(Constant) -15.181 .000
Innovation -.064 -.590 .557 Rejected .231 4.323
External Environment .248 2.093 .039 Accepted .193 5.181
Information
Sharing Culture .354 3.156 .002 Accepted .215 4.641
Organization Readiness .344 2.345 .021 Accepted .126 7.942
Overall model F = 66.199, p < 0.01, R = 0.718, Adjusted R = 0.707; Durbin-Watson test 1:822
2 2

lem in the data. Therefore, it indicated that the error term was Discussion
independent. Variance-inflation factor (VIF) and Tolerance
were applied to test for multicollinearity among the independent The results of this study revealed that information sharing
variables. The multicollinearity statistics showed that the culture is perceived as a dominant factor in the adoption of
tolerance indicator for Innovation, Environmental, Information c-commerce. Unlike existing studies on technology adoption,
Sharing Culture and Organization readiness are all greater than c-commerce which is implemented to support a collaborative
0.1, and Variation Inflation Factors (VIF) were all lesser than 10. supply chain requires the sharing of information. A major part
This result indicates no multicollinearity problem has occurred of collaborative supply chain is the openness of the supply chain
according to [29], [31]. members with regards to the sharing of information, objectives,
The F-statistics produced (F = 66.199) which was significance issues and problems [1]. The result shows that Information sharing
at 1 percent level (Sig. F < 0.01), thus confirming the fitness for culture has the most significant in the adoption of c-commerce.
the model. This indicated that there was a statistically significant As such, organizations need to adopt the culture of sharing
relationship between the adoption factors in the model and information before they can fully implement c-commerce.
c-commerce adoption level. The coefficient of determination, R2 Organization readiness is also an important determinant in
was 70.7 percent. This expressed that the adoption factors could whether organizations adopt c-commerce which is supported
significantly accounted for 70.7 percent in c-commerce adoption by existing studies [19], [28], [36], [48]. For c-commerce to
level among Malaysian E&E companies. implement a collaborative supply chain there is a need to have top
The results showed that external environment (b = 0.248, management support. When the organization has the support of
p = 0.039), information sharing culture (b = 0.354, p = 0.002) top management with both the financial and technical resources
and organization readiness (b = 0.344, p = 0.021) are positively available to the organization, the chances of adopting c-commerce
associated with the adoption of c-commerce. It can be argued will be higher. The aspect of appointing a project champion and
that these three factors were all directly involved in the adop- looking at the project’s champion experience has sometimes
tion level of c-commerce. Based on Table III, the most impor- being overlooked in adoption studies. This study also shows that
tant c-commerce adoption factors were information sharing organizations which are committed to adopting c-commerce will
culture, followed by organization readiness and external envi- have a higher adoption level if they appoint a project champion
ronment. Hence the hypotheses H2, H3 and H4 were supported. with computer background and has been involved in similar
Innovation factor however, was found not to be significantly projects before.
associated with c-commerce adoption. Therefore H1 was not In addition, external environment also has a significant and
supported. positive relationship with c-commerce adoption. Companies

Winter 2009 Journal of Computer Information Systems 19

with higher adoption of c-commerce have been pressured by shows that adoption studies can move beyond studying the factors
their business partners and the industry’s demands into adopting based on traditional models such as Innovation diffusion model
c-commerce. Many of these companies also expect c-commerce which is focused on the Innovation factors.
to be pervasively adopted in industry. In the long term, with the Secondly, many existing adoption studies have studied on
continued business pressure and the business trends moving older Internet technologies for supply chain such as EDI and
towards implementation of c-commerce for a collaborative supply E-commerce, but there has not been an empirical study on
chain, more and more E&E organizations will adopt c-commerce. the adoption of c-commerce in supply chain. As c-commerce
The expectation of market trend is viewed as an important requires co-adoption of more than one trading partners, this study
external environment factor, it is important the Malaysian has added an information sharing construct consisting of trust,
E&E industry established the industry standards with regards information interpretation and information distribution. Although
to the implementation of c-commerce. The significant finding trust has been studied in existing interorganizational relationships
for expectation of market trend is consistent with prior studies studies, existing studies did not include information interpretation
[28]. [28] is particularly important as they studied on IOS and information distribution.
standards, which is very closely related to c-commerce since Thirdly, this study has also added two new c-commerce tools
both c-commerce and IOS standards need to be agreed upon by to studies in [4], which are RosettaNet standards and E-Hub.
majority of companies in the industry before it can be pervasively As this study was conducted in Malaysia’s E&E industry, the
adopted. For many companies, once they are committed to c-commerce tools are slightly different from [3] after being
c-commerce, they cannot afford the time or the cost to reconfigure verified by Malaysian E&E executives. Future studies attempting
their backend applications. The Malaysian government has to study on c-commerce tools can include the tools used in this
committed to establishing XML and Interorganizational Standards study.
(IOS) such as RosettaNet as the industry standards for Malaysian Regarding practical contributions, organizations which would
E&E [7]. like to adopt c-commerce or increase the level of adoption will be
Innovation factor however, was found to be an insignificant able to apply strategies and make managerial decisions based on
determinant of the c-commerce adoption. This is a significant the findings from this research. In order to implement c-commerce
finding as it contradicted with findings from existing technology or Collaborative supply chain, the commitment is needed from
adoption studies. Attributes such as relative advantage, com­ more than one member of the supply chain. Likewise, efforts in
patibility, complexity has been found to be significant determinants promoting a collaborative supply chain in the industry require the
of adoption in prior research by researchers such as [40] and [49]. implementation of c-commerce from the industry. Organizations
It also contradicted with recent study in e-commerce adoption that would like to adopt the technology will require changing
among Malaysian E&E companies [42]. However, the finding their mindsets in terms of sharing of information. Furthermore,
from this research is not without precedence as prior adoption organizations should also be ready and commit the necessary
studies on EDI from [36] have found a lack of significance in technical and financial resources to the implementation of
Innovation attributes such as relative advantage. Similarly, [28] c-commerce. As financial and technical feasibility seems to
also found that innovation attributes such as relative advantage, be an important influence on whether organizations adopt
compatibility and complexity were not significant. Thus in certain c-commerce, a company with better financial or technical resources
situations, other factors are more important in distinguishing the might consider providing more of such assistance to their trading
c-commerce adoption level. Other factors such as information partners. In the long run, the financial cost of assistance could be
sharing culture, organization readiness and external environ- covered by having a more efficient supply chain. Organizations
ment are found to be strongly associated with the adoption of with less resource will also realize the benefits of adopting
c-commerce. Furthermore, it also shows that organizations have c-commerce in their supply chain which in the long run will
understood c-commerce technologies better. Innovation factor enable them to compete with their bigger rivals.
such as its relative advantage, compatibility and complexity Organizations have also adopted c-commerce due to pressure
are no longer significant factor in determining their adoption of from the E&E industry in general, and pressure from trading
c-commerce. partners in particular. The industry as a whole therefore needs
to continuously promote the use of c-commerce and made award
Conclusions and implications of competitive advantages which could be gained through the
implementation of c-commerce.
The study revealed that adoption factors such as information Technologies such as EDI suffered from lack of adoption
sharing culture, organization readiness and external environment due to its lack of standards. However, as this study shows,
are positively related to c-commerce adoption level. The findings organizations are willing to share information if there is an
made a contribution in terms of creating an understanding of what information interpretation process that takes place. This study
influence the adoption of c-commerce, which is essential in the also showed that when organizations have existing information
implementation of collaborative supply chain. distribution systems using IT, they are more likely to adopt
The implication of this study can be divided into two c-commerce. Therefore before an organization plans to adopt
categories: theoretical contributions and practical contributions. c-commerce with its partners, they might consider communicating
Existing literatures have shown that the collaborative supply or distributing information using IT technologies such as video
chains are moving towards the direction of collaborative supply conferencing and emails. In the long rum, organizations are more
chain through the use of c-commerce. In terms of theoretical likely to develop an information sharing culture through the use
contributions, firstly, this study has extended previous researches of IT technologies if they have been distributing information
conducted in western countries and provides great potential by using IT.
advancing the understanding between the association of adoption Organizations should also focused on building trusts with
factors and c-commerce adoption level. This research has also their supply chain partners if they plan to implement c-commerce.

20 Journal of Computer Information Systems Winter 2009

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