The information technology adoption process within Indonesian small and medium enterprises
- Publication Type:
- Thesis
- Issue Date:
- 2007
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This thesis examines the adoption process of Information Technology (IT)-based
solutions within small and medium enterprises (SMEs) in Indonesia, in the furniture and
handicraft industries. As the Indonesian SMEs grew in size, they faced new problems in
managing their businesses. They have tried to use IT to support their business and
resolve some of these problems. Yet in their efforts to adopt IT, they often faced new
problems by introducing new technology into the organisation.
The thesis examines the experiences of 35 Indonesian SMEs when they adopted
IT. We investigated what factors were influencing IT adoption; the process of IT
adoption which covers decision making, implementation or deployment and evaluation;
and how SMEs cope with and recover from failure. The participants’ experiences were
compared to what has been reported in the existing literature.
Analysis of the relevant research literature revealed some unexplored issues
concerning IT adoption within SMEs. Most of the published research has been
conducted in developed countries, with little in developing or less developed countries.
From those few, only one was conducted in Indonesia and it was about IT diffusion.
The focus of previous studies was mainly to explore factors influencing IT adoption and
they mostly utilised survey techniques to elicit the factors. The scant literature suggests
that exploring IT adoption can be approached from three different perspectives:
individualist, structuralist, and interactive process. This thesis uses the interactive
process approach to explore how well those factors that have been well documented in
the literature actually work in Indonesian SMEs’ IT adoption. As a result of our
exploration, we formulated a model of an interactive process view of IT adoption within
Indonesian SMEs.
A qualitative approach was used to answer research questions and explore the
participants’ experiences in depth. In this thesis, we used in-depth interviews to explore
participants’ experiences. These interviews enabled us to draw out not only IT adoption
processes but also successes and failures in IT adoption. Semi-structured interviews
were used as the data collection tool. They provided guidance so the interviews stayed
well within the focus of the thesis, yet provided room to explore new and relevant issues
that emerged during the interview process. Content analysis of the interview transcripts
was used to extract answers given during the semi-structured interviews and to identify
new themes that emerged from the data.
The analysis resulted in important findings. First, it confirms some factors found
in the literature as actually influencing IT adoption in Indonesian SMEs. Despite some
similarities, we found some differences such as government role and competitors’
influence on IT adoption. The other findings are concerned with the failures faced by
some of the participants. We then explore the differences between failed and successful
participants, and how Indonesian SMEs cope with and recover from failed IT
deployment. Finally, we revised the initial model of the interactive process of IT
adoption. The extended model captures new insights into success and failure of IT
adoption, and could provide a better understanding of IT adoption within Indonesian
SMEs. The interaction between different factors in the IT adoption shows how those
factors influence each other and how different stakeholders could manage their own
interests related to IT adoption. The improved model could be used to guide Indonesian
SME managers to manage their adoption of IT more effectively.
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