Introduction
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Recently, the public and private sector in ASEAN have taken the initiative in encouraging the development of Internet B2Bs. For example, the E-ASEAN framework has been set up to improve Internet penetration and develop a B2B e-commerce community for ASEAN's small and medium enterprises (SME) (Legard, 2000). FreeMarkets and the US-ASEAN business council have also formed strategic alliances to facilitate the growth of Internet B2B in ASEAN (FreeMarkets, 2001). Numerous electronic markets are being formed worldwide; more than 750 were in existence at the beginning of the year 2000 (Seller Beware, 2000). However, AMR Research found that not even 1% of 600 B2B portals had reached the overall feasible trading volume in the business (The Container Case, 2000), and IDC reported that of the approximately 1000 B2B public exchanges launched between early 2000 and mid-2001, only about 100 are handling any genuine transactions ("Time to rebuild," 2001). In this chapter, game theory and social theory inform the discussion of technology adoption decisions in general, and B2B electronic commerce in particular. Technology adoption is a risky proposition, even when it is limited to a firm's internal processes. It demands a collective decision to exchange one set of expertise for another, which changes the social context of work. E-commerce technologies reach beyond the bounds of the firm, extending the impact of process re-engineering. Adoption will ultimately depend on perception of the risks and payoffs, which is the realm of game theory. Modeling B2B e-commerce as games of asymmetric information offers insight into these perceptions, and the strategies of the players. Turban, Lee, King, and Chung (2000) provide a succinct taxonomy of business models for B2B electronic commerce. "Intermediary-oriented marketplace" describes a World-Wide Web (WWW) site that acts as a marketing channel for products that are of interest to businesses rather than consumers, operated by a third party that does not produce or use the products in question. The "seller-oriented marketplace" is similar, except it is focused on the products of a single vendor. The "buyer-oriented marketplace" features facilities for bidding on RFQs, and are often run over closed networks or open by invitation only (pp. 204 206). Here, the terms "electronic market" and "Internet B2B" will be used to refer to all three of these. "Public exchange" and "portal" include both intermediary-oriented and supplier-oriented marketplaces, while "private market" refers to the buyer-oriented marketplace model. The intention is to gloss over the wide range of possible business models in favor of uncovering common motivations for participation.
ImplementationWhen Wirtz and Wong (1999) surveyed selected industrial companies in Singapore, they found only one-third of the SMEs using or interested in using Internet B2B. The vast majority of their respondents cited "No Need" as a barrier to participation. Amongst firms that were interested in or already using Internet B2B, the top motivations cited were image and reputation, increase in sales, and the global reach of suppliers and customers. This group cited security, setup costs, and ongoing operational costs most frequently as barriers to adoption. Firms implement strategic information technology (IT) applications to gain an edge over competitors or to prevent competitors from gaining an edge over the firm. King and Teo (1996) found that the implementers placed more emphasis on innovative needs and economies of scale than did the non-implementers, both as facilitators and inhibitors. The non-implementers emphasized top management guidance as an important facilitator, and the lack of adequate IT-related support as an important inhibitor. Both groups identified competitive position and environment as important facilitators.
Facilitators and InhibitorsKing and Teo's factors are more closely linked than they might appear. Innovative needs imply that firms can gain a favorable image or reputation by using technology to differentiate their products and services. Firms that do not seek to be unique or innovative may be more likely to adopt a "wait and see" attitude toward the strategic application of IT. Well-defined management objectives and top management support are prerequisites for the perceived importance IT to company strategy. It is entirely possible that the management support is simply taken for granted; when it comes to corporate culture, the absence of management support may be more notable than its presence. Moreover, investments that benefit only a limited part of the firm reduce the pool of resources available to all others, and political considerations may weigh heavily in the decision. Competitive position refers to the need to improve or maintain market position, and the company's image or reputation. Favorable environmental change in the form of market growth and overall economic growth make it easier to increase investment in IT, since resources are more readily available. Finally, economies of scale make investment more feasible. The IT application described by the implementers was most often directed at internal operations and / or customers, and the group was biased toward companies with more than 10,000 employees. Large companies have more absolute capacity to invest, and the number of users is more likely to reach the critical mass required for maintenance of qualified full-time support staff. Large companies can also spread investments over a number of operational budgets.
Learning CurveMason, Bowling, and Niemi (1998) distill three other key points from the literature related to SME adoption of information technologies:
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EAN: 2147483647
Pages: 188