Technological Context

Technological context refers to the perceptions of an organisation of the existing technologies in use within the organisation and new technologies relevant to the organisation (Tornatzky & Fleischer, 1990; Zhu et al., 2006). The factors from the technological context included in the model (see Figure 3-1) were relative advantage, compatibility, and complexity. These factors were based on DOI theory by Rogers (2003), discussed in section 2.6.1. Relative advantage, compatibility, and complexity are three of the characteristics of innovation that, according to DOI theory, influence adoption decisions. The remaining two characteristics of innovation, trialability and observability, were not included because they received little support in prior empirical studies of technology adoption and use; see section 2.6.1 for a detailed discussion.

3.4.1.1 H1: Relative Advantage

Organisations adopt and use an innovation such as new technology only when they perceive the potential benefits of using the innovation (Rogers, 2003). Numerous prior studies presented evidence supporting the relationship between perceived relative advantage (perceived benefits associated with using a technology) and technology adoption and use by organisations (see, for example, Abu-Elsamen et al., 2010; Alam et al., 2007; Chan & Ngai, 2007; Lee, 2004; Lin & Lin, 2008; Looi, 2005; Pearson & Grandon, 2005; Premkumar & Roberts, 1999; Tan et al., 2009; Teo, Tan, & Buk, 1998; Teo et al., 2007; Teo et al., 2009; Thong, 1999; Zhu, Dong, Xu, et al., 2006; Zhu, Kraemer, Gurbaxani, et al., 2006). For instance, Tan et al. (2009), in a

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survey of companies in the manufacturing and services industries in Malaysia, found that relative advantage affected the extent of Internet-based ICT use (as measured by years of use). Studies that presented evidence that perceived benefits of e- procurement positively affect e-procurement adoption by organisations were discussed in section 2.7.7.1.

The benefits of e-procurement adoption and use for organisations found in descriptive studies of e-procurement (identified based on the opinions of the respondents) were discussed in detail in section 2.4.2 and include reducing business cost, reducing purchasing time, streamlining purchasing processes, accessing wider markets, and improving relationships with trading partners (see Table 2-3 for a summary and the rest of the section for an in-depth discussion).

Perceptions of e-procurement resulting in benefits to an organisation are likely to result in the organisation using a broader range of e-procurement forms and

functionalities and in relying more on e-procurement in the organisation’s core

business processes. The following hypotheses are, therefore, justified:

H1a: There is a positive relationship between relative advantage and the breadth of e-procurement use.

H1b: There is a positive relationship between relative advantage and the depth of e-procurement use.

3.4.1.2 H2: Compatibility

Organisations are more likely to adopt and use an innovation when it is compatible with their existing practices and values (Rogers, 2003). Prior studies (see, for example, Alam et al., 2007; Lee, 2004; Pearson & Grandon, 2005; Premkumar, 2003; Premkumar & Roberts, 1999; Tan et al., 2009; Teo et al., 1998; Teo et al., 2007; Thong, 1999; Zhu, Dong, Xu, et al., 2006) presented evidence suggesting that organisations are more likely to adopt and use technology that is compatible with the

organisations’ existing information technology infrastructure, business processes,

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companies in multiple industries in European countries (covering Finland, France, Germany, Italy, Spain, and UK), found that compatibility with business processes and values was a stronger driver in explaining the extent of e-business use (as measured by the percentage of business transactions conducted online) than relative advantage. The prior explanatory studies of e-procurement adoption and use considered e-procurement compatibility in terms of the compatibility with information technology infrastructure; studies that presented evidence that perceived compatibility of e-procurement with existing information technology infrastructure positively affect e-procurement adoption by organisations were discussed in section 2.7.7.1.

Several compatibility issues of e-procurement, technical issues, change management issues, inadequacy of business processes to support e-procurement, inability to identify potential items for auction, and difficulty of judging the usefulness and potential of information technology, were discussed in detail in section 2.4.3 as barriers to e-procurement identified in prior descriptive studies (see Table 2-4 for a summary and the rest of the section for an in-depth discussion).

Perceptions of e-procurement being compatible with preferred work style, existing work practices, prior experience, and values of an organisation are likely to result in the organisation using a broader range of e-procurement forms and functionalities

and in relying more on e-procurement in the organisation’s core business processes.

The following hypotheses are, therefore, justified:

H2a: There is a positive relationship between compatibility and the breadth of e- procurement use.

H2b: There is a positive relationship between compatibility and the depth of e- procurement use.

3.4.1.3 H3: Complexity

An innovation that is perceived as easy to use and to understand is more likely to be adopted and used by an organisation (Rogers, 2003). Difficulty in understanding and

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applying a new technology increases the risk associated with its adoption (Teo et al.,

2007) and may result in slower recognition of the technology’s value, fear of failure,

and resistance (Cho & Kim, 2002). Prior studies (see, for example, Alam et al., 2007; Lee, 2004; Premkumar & Roberts, 1999; Soliman & Janz, 2004; Tan et al., 2009; Thong, 1999) presented evidence suggesting that organisations are more likely to adopt and use technology that is perceived as less complex. For instance, Tan et al. (2009), in the study introduced in section 3.4.1.1 (in conjunction with justifying hypothesis H1), found that complexity affected the extent of Internet-based ICT use (as measured by years of use). The prior explanatory studies of e-procurement adoption and use considered e-procurement complexity in terms of the perceived cost of e-procurement adoption and use; studies that presented evidence that perceived costs of e-procurement negatively affect the depth of e-procurement use by organisations were discussed in section 2.7.7.1.

Several complexity issues of e-procurement, implementation cost issues, regulatory and legal issues, and security issues, were discussed in detail in section 2.4.3 as barriers to e-procurement identified in prior descriptive studies (see Table 2-4 for a summary and the rest of the section for an in-depth discussion).

Perceptions of e-procurement being easy to implement and use within an organisation are likely to result in the organisation using a broader range of e- procurement forms and functionalities and in relying more on e-procurement in the

organisation’s core business processes. The following hypotheses are, therefore,

justified:

H3a: There is a negative relationship between complexity and the breadth of e- procurement use.

H3b: There is a negative relationship between complexity and the depth of e- procurement use.

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