B2B e-commerce and competitive advantage in small and medium-sized enterprises

337 Pages·2014·2.43 MB·English

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Antecedents of business-to-business e-commerce adoption
and its effect on competitive advantage in manufacturing small
and medium-sized enterprises:
A comparative study of United States of America and Egypt

by

Haseba Salem Hamad

A thesis submitted to the Plymouth University
in partial fulfilment for the degree of

DOCTOR OF PHILOSOPHY

Plymouth Graduate School of Management
Faculty of Business

July 2014
Antecedents of business-to-business e-commerce adoption
and its effect on competitive advantage in manufacturing small
and medium-sized enterprises:
A comparative study of United States of America and Egypt
Haseba Salem Hamad
Abstract
Business-to-business (B2B) e-commerce adoption has become a necessity for most
small and medium-sized enterprises (SMEs), allowing them to gain and sustain
competitive advantage in a dynamic competitive environment. Accepting the fact that
B2B is adopted at different levels based on different resources leads to the
acceptance that competitive advantage is gained and sustained on a level consistent
with the level of adoption. This study employs quantitative method based on the
positivism philosophy and deductive approach. A questionnaire survey technique was
used to collect the data from the American and Egyptian manufacturing SMEs.
Moreover, it used structural equation modelling with a sample of 320 and 260
manufacturing SMEs in the United States of America and Egypt respectively.

The structural equation modelling (SEM) findings revealed that each level of B2B e-
commerce adoption was affected by different factors from another level of adoption.
Besides, there was a significant difference between the issues which faced
manufacturing SMEs in USA and Egypt. Furthermore, in Egyptian manufacturing
SMEs, relative advantage and competitive pressure have a significant effect on
adoption behaviour. On the other hand, when American manufacturing SMEs made
their decisions to adopt B2B e-commerce, they considered the main factors to be
relative advantage, top management support, firm size and government support. In
addition, the findings revealed that the higher the level of B2B e-commerce, which an
SME adopted, the higher the level of competitive advantage it gained. However, in
developing countries such as Egypt, SMEs remained far behind their peers in
developed countries.

In terms of theoretical implications, the study could be considered to be a unique
study in the field of B2B e-commerce generally and B2B e-commerce in Egyptian
manufacturing SMEs in particular. This is because, by looking back at the literature
review, is clear that empirical studies into B2B e-commerce issues, including
manufacturing SMEs, remained embryonic in developed countries and rare in the
developing countries. This is especially so in the Arabic countries. In addition, most
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previous studies focused on a broad and generic view of the SMEs’ adoption of B2B e-
commerce or on the relationship between adoption of IT and competitive advantage.
This study was conducted in a cross-country context; it considered the manufacturing
SMEs’ adoption of B2B e-commerce from the perspective of the level of adoption.
Therefore, it made an original empirical contribution towards the current body of
knowledge on the adoption of B2B e-commerce through the identification of
manufacturing SMEs adoption levels of B2B e-commerce; their impacts on
competitive advantage; and the significant factors which influenced each adoption
level of B2B e-commerce in USA and Egypt. In addition, this study used TOE as the
theoretical framework in investigating the factors affecting B2B e-commerce in SMEs
and focused largely on the factors affecting each level; this is a new contribution to
the extant literature.

Turning to the study’s practical implications, important implications for the
manufacturing SMEs’ owner/managers can be drawn from the findings to help them
to understand their environments as, in a cross-country business context, they move
through the different stages of adopting B2B e-commerce. In addition to the
implication for manufacturing SMEs’ owners/managers, this study presents important
implications for governmental, nongovernmental organisations and other institutions
linked to manufacturing SMEs. Similar to other studies, this study has a number of
limitations. The main one is that it lacks the use of qualitative analysis to depict how
SMEs understand the concept of competitive advantages and how this helps them to
survive and grow.

Key words: TOE framework, B2B e-commerce adoption, competitive advantage, SMEs
and Egypt and USA

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DEDICATION
To my great father and mother,
To my brothers and sisters, and friends
A special dedication to my director of studies,
Ibrahim Elbeltagi

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Table of contents
Abstract……………………………………………………………………………………………………………………iii
Dedication………………………………………………………………………………………………………………...iv
List of Tables…………………………………………………………………………………………………………….xiii
List of Figures……………………………………………………………………………………………………………xvi
List of Abbreviations………………………………………………………………………………………………..xvii
Acknowledgements…………………………………………………………………………………………….......xix
Author's declaration………………………………………………………………………………………………….xx
Chapter 1: Introduction………………………………………………………………………………………………1
1.1 Research background……………………………………………………………………………………………2
1.1.1 Why B2B e-commerce............................................................................................2
1.1.2 Why Small and medium-sized enterprises (SMEs)................................................ 4
1.2 Research problem…………………………………………………………………………………………………6
1.3 Research aim and objectives…………………………………………………………………………………7
1.4 Research methodology…………………………………………………………………………………………8
1.5 Structure of the thesis………………………………………………………………………………………….9
1.6 Summary…………………………………………………………………………………………………………….11
Chapter 2: B2B e-commerce and competitive advantage in small and medium-sized
enterprises (SMEs)……………………………………………………………………………………………………12
2.1 Introduction………………………………………………………………………………………………………..14
2.2 Profile of SMEs in USA…………………………………………………………………………………………14
2.2.1 Definition of SMEs……………………………………………………………………………………………14
2.2.2 Number of SMEs in the USA…………………………………………………………………………….15
2.2.3 Economic contribution of the USA SMEs………………………………………………………….15
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2.3 Profile of SMEs in Egypt………………………………………………………………………………………19
2.3.1 Definition of SMEs……………………………………………………………………………………………19
2.3.2 Number of SMEs in Egypt…………………………………………………………………………………20
2.3.3 Economic contribution of Egyptian SMEs…………………………………………………………20
2.4 Definition of B2B e-commerce……………………………………………………………………………22
2.5 Benefits of B2B e-commerce adoption……………………………………………………………….27
2.6 B2B e-commerce adoption in SMEs in developed countries……………………………….30
2.7 B2B e-commerce adoption in SMEs in developing countries……………………………….31
2.8 Factors affecting developed countries’ SMEs adoption of B2B e-commerce……….32
2.9 Factors affecting developing countries’ SMEs adoption of B2B e-commerce………35
2.10 Factors affecting B2B e-commerce adoption in current study…………………………..40
2.11 B2B e-commerce implementation models………………………………………………………..53
2.12 Definition of competitive advantage…………………………………………………………………66
2.13IT and competitive advantage……………………………………………………………………………69
2.14Summary……………………………………………………………………………………………………….....87
Chapter 3: General theories of adoption of technology, conceptual model and
hypotheses……………………………………………………………………………………………………………….89
3.1 Introduction……………………………………………………………………………………………………….90
3.2 Technology acceptance model (TAM)………………………………………………………………. 90
3.3 Innovation diffusion theory (IDT)………………………………………………….. ………………….91
3.4 Technology-organisation-environment frameworks (TOE)……………………………….. .92
3.5 Hypotheses and conceptual framework …………………………………………………………… 99
3.5.1 Research hypotheses……………………………………………………………………………………..100
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3.5.1.1 The relationship between technological factors and levels of B2B e-commerce
adoption…………………………………………………………………………………………………………………100
3.5.1.2 The relationship between organisational factors and levels of B2B e-commerce
adoption…………………………………………………………………………………………………………………103
3.5.1.3 The relationship between environmental factors and levels of B2B e-
commerce adoption……………………………………………………………………………………………….106
3.5.1.4 Level of adoption of B2B e-commerce………………………………………………………..110
3.5.1.5 The relationship between levels of B2B e-commerce adoption and competitive
advantage…………………………………………………………...…………………………………………………111
3.5.2 Research conceptual framework…. ……………………………………………………………….117
3.6 Summary…………………………………………………………………………………………………………..119
Chapter 4: Methodology and research design…………………………………………………………120
4.1 Introduction………………………………………………………………………………………………………122
4.2 Research philosophy…………………………………………………….…………………………………..122
4. 3 Research approach…………………………………………………………………………………………..124
4.4 Research method………………………………………………………………………………………………126
4.5 Questionnaire surveys………………………………………………………………………………………126
4. 5.1 Questionnaire design…………………………………………………………………………………….127
4.5.2 Survey measurement instrument…………………………………………………………………..129
4.5.3 Questionnaire layout……………………………………………………………………………………..133
4.5.4 Population and sample size for questionnaire survey…………………………………….134
4.5.4.1 Sampling frame………………………………………………………………………………………….136
4.5.4.2 Sample size…………………………………………………………………………………………………137
4.5.4.3 Sampling technique…………………………………………………………………………………….138
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4.6 Pretesting questionnaire of study……………………………………………………………………139
4.6.1 Face and content validity………………………………………………………………………………139
4.6.2 Translation of questionnaire…………………………………………………………………………141
4.6.3 Pilot study…………………………………………………………………………………………………….142
4.7 Analysis procedures of survey questionnaire……………………………………………………152
4.7.1 Structural equation modelling………………………………………………………………………152
4.7.2 Covariance-based SEM versus Variance-based SEM………………………………………153
4.7.3 Warp PLS 3.0…………………………………………………………………………………………………154
4.8 Summary…………………………………………………………………………………………………………..155
Chapter 5: Data analysis ………………………………………………………………………………………..156
5.1 Introduction………………………………………………………………………………………………….....158
5.2 Main survey and response rates……………………………………………………………………….158
5.3 Descriptive statistics…………………………………………………………………………………………159
5.3.1Levels of B2B e-commerce adoption..................................................................160
5.3.2 Factors affecting B2B e-commerce adoption…………………………………………………164
5.3.3 Competitive advantage………………………………………………………………………………….171
5.4 Non-response bias……………………………………………………………………………………………175
5.5 Structural equation model (SEM) results………………………………………………………….180
5.5.1 Measurement model…………………………………………………………………………………….180
5.5.1.1 Measurement model for reflective latent variables……………………………………181
5.5.1.1.1 Measurement model for reflective latent variables: USA context…………….183
5.5.1.1.2 Measurement model for reflective latent variables: Egyptian context……..187
5.5.1.2 Measurement model for formative latent variables……………………………………190
5.5.1.2.1 Measurement model for formative latent variables: USA context…………...191
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5.5.1.2.2 Measurement model for formative latent variables: Egyptian context…….192
5.5.2 Structural model……………………………………………………………………………………………195
5.5.2.1 Structural model for level 1………………………………………………………………………..198
5.5.2.1.1 Structural model for level 1: USA context………………………………………………..198
5.5.2.1.2 Structural model for level 1: Egyptian context…………………………………………204
5.5.2.2 Structural model for level 2………………………………………………………………………..207
5.5.2.2.1 Structural model for level 2: USA context………………………………………………..207
5.5.2.2.2 Structural model for level 2: Egyptian context…………………………………………211
5.5.2.3 Structural model for level 3………………………………………………………………………..214
5.5.2.3.1 Structural model for level 3: USA context…………………………………………………214
5.5.2.3.2 Structural model for level 3: Egyptian context…………………………………………218
5.5.2.4 Structural model for level 4………………………………………………………………………..222
5.5.2.4.1 Structural model for level 4: USA context………………………………………………..222
5.5.2.4.2 Structural model for level 4: Egyptian context…………………………………………226
5.6 Model fit indices……………………………………………………………………………………………….230
5.7 T-test………………………………………………………………………………………………………………..230
5.8 Summary………………………………………………………………………………………………………….232

Chapter 6: Discussion of findings……………………………………………………………………………233
6.1 Introduction………………………………………………………………………………………………………234
6.2 Factors affecting the levels of B2B e-commerce adoption…………………………………234
6.2.1 Factors affecting the levels of B2B e-commerce adoption in USA manufacturing
SMEs………………………………………………………………………………………………………………………235
6.2.2 Factors affecting the levels of B2B e-commerce adoption in Egyptian
manufacturing SMEs……………………………………………………………………………………………….241
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