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EJISDC (2002), 10, 4, 1-13

Small Businesses Acceptance and Adoption of e-Commerce in the


Western-Cape Province of South-Africa
Eric Cloete
Email: ecloete@commerce.uct.ac.za
Steven Courtney
Julia Fintz
Department of Information Systems,
University of Cape Town

South Africa
Abstract
This paper reports on research that was undertaken in Information Systems at the University
of Cape Town on the acceptance and adoption of e-commerce amongst small businesses in
the manufacturing sector. It addresses how these small businesses in a developing country
perceive the potential benefits of e-commerce and looks at their consequent adoption of ecommerce activities in their own organisations. This includes the businesses perception of
the benefits and opportunities of e-commerce activities and to determine whether these
businesses have the necessary technological capabilities for e-commerce adoption in place.
A secondary aim of this research was to determine the current level of e-commerce adoption
by small manufacturing businesses in the Western Cape. This was achieved by circulating a
questionnaire to test the perception of e-commerce benefits and e-commerce adoption levels
amongst small manufacturing businesses in the Western Cape. If the global usage of the
Internet for electronic commerce by SMEs is compared with the South African case, this
research clearly indicates that the available technologies are not adopted to the extent that is
necessary for survival in a rapidly changing environment.
Keywords: e-commerce, adoption of e-commerce, SMEs, manufacturing industries
Acknowledgements
The authors acknowledge and appreciate the work done by Steven Davies, a part-time
honours student who has been involved in a similar research project (Davies, 2002).
1.
THE ACCEPTANCE OF E-COMMERCE
Many studies have researched the benefits of the adoption of e-commerce in an organisation.
While the potential benefits have been established, a number of inhibitors to the adoption of
these new business models still exist. For small businesses the advantages of e-commerce
adoption are often not perceived to be applicable and few success stories are available to
convince owners of such firms that e-commerce offers a real benefit to their organisations.
Although previous research on e-commerce and SMEs (small to medium sized
enterprises) incorporates small businesses, there is little research done on small businesses in
particular. Although the classification of enterprises is normally based on size, turnover and
number of employees, the definition of an SME differs in the literature and no fixed
definition therefore exists. For this research we classified a business as an SME if it has a
single CEO and not more than fifty employees.
The objective of this study is to focus on small businesses in the Western Cape
Province of South Africa. Moreover, being e-ready can support the elimination of barriers
that have traditionally stifled the flow of information and goods to and from developing
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nations. With e-readiness being considered a prerequisite for successful e-business thereby
enabling these opportunities to be harnessed (McConnell International Report, 2000).
The focus of this study is on the small manufacturing sector due to the fact that these
firms traditionally lagged behind those in other industries with regards to technology
adoption (Poon and Swatman, 1999, Turner, 1999). We further decided to look specifically at
only this sector in order to gain a better understanding of the industrys perceptions towards
and adoption of e-commerce. This study therefore aims to discover the consequent ecommerce adoption levels among these businesses.
There has been a marked change in perceptions towards e-commerce before the
dotcom crashes of 2000 and thereafter (Agrawal et al., 2001, Schneider and Perry, 2001).
This research provides insight into the current perceptions of small manufacturing businesses
in the Western Cape towards e-commerce and helps to determine to what extent e-commerce
will be adopted in the future.
It is a well-known fact that e-commerce and Internet technologies can benefit an
organisation (Akkeren and Cavaye, 1999). This is particularly true for SMEs due to the fact
that e-commerce improves an SMEs ability to compete with larger organisations and operate
on an international scale. E-commerce can deliver the tools to provide cost effective ways for
SMEs to market themselves, launch new products, improve communications, gather
information, and identify potential business partners. The obvious aim of these e-activities is
to extend their capabilities to higher turnovers and larger markets. Despite these potential
benefits of e-commerce to an SME, there seems to be a perception by owners of SMEs that
there is a lack of business benefit, if the input is weighed against immediate returns (Harrison
et al.,1997). Due to the fact that the ownership and decision making power in an SME is held
by just one or two people, adoption of e-commerce into such an organisation is heavily reliant
on these peoples acceptance of the technology. It is important, therefore, to understand what
factors lead to an individuals acceptance of a technology. The Technology Acceptance
Model (TAM) (Davis, 1986) is an appropriate tool for this study.
Usefulness

Intention/

External
Variables

Attitude
Ease of Use

Figure 1: Technology Acceptance Model (Davis, 1986)


The potent ial user of e-commerce must not only be convinced of the relevant
usefulness of e-commerce (advantages), but s/he must also have a positive attitude towards it
(embracing EC). The TAM model further states that the user must be comfortable with the
technolo gy employed (ease of use), although s/he expects factors affecting acceptance of the
technology to be beyond the control of the user (external variables).
2.
BENEFITS OF ECOMMERCE
Adoption of e-commerce is largely based on perceived benefit. Poon and Swatman (1997)
found that perceived benefit is a key reason why organisations adopt and continue to use the
Internet. They classified perceived benefits into 'direct' and 'indirect' benefits. Direct benefits
are quantifiable by using techniques such as data analysis and measuring variables such as the
number of new customers as a result of e-commerce implementation. Indirect benefits are not

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EJISDC (2002), 10, 4, 1-13

easily measured but rather have a positional effect on the business, e.g. customer loyalty and
goodwill as a result of added value and services provided online.
Poon and Swatman (1997) also identified short-term and long-term benefits. Shortterm benefits should be realised within months, whereas long-term benefits may take longer
to be achieved and are unpredictable. Their research showed that SMEs are reaping
insignificant, marginal short-term benefits from e-commerce. They identified long-term
benefits as being the key motive for ongoing Internet activities. These might include
additional customer enquiry, forming new networks, and reaching previously untapped
markets.
Some additional benefits of e-commerce are listed below:
(Harrison et al., 1997 , Iacovou et al., 1995)

Improved Information Exchange with Customers/Suppliers


Improved Customer Service
Expanded Business Reach
Access to International Markets
Reducing Costs

3.
ADOPTION OF E-COMMERCE
It is important to recognise that e-commerce activities range from entry- level activities such
as having web browsers, web sites, and email, to sophisticated activities such as online
payments, making purchases online, customer services, and video conferencing, amongst
others. Akkeren and Cavaye (1999) state that the adoption of e-commerce practices is a
progression, and therefore sophisticated technologies are unlikely to be adopted before entry
level technologies have been successfully adopted. These entry- level activities provide the
necessary technological infrastructure from which more sophisticated e-commerce activities
can be developed.
As an organisation progresses up the ladder it must undergo change and become more
sophisticated in its use of technology. As the business implements these new changes it is
ultimately able to improve business efficiencies.
Planning for Web presence can be summarised as three distinct stages:

Static pages for advertisement and e- mail communication with clients. External
communication will include enquiries and quotes from customers, procurement
processes between businesses and many other EDI1 exchanges.

Database integration, involving complete and interactive catalogues. Shopping cart


technology and secure payments becomes an integral part of all the transaction
processing generated by websites. To complete the transaction processes, order
information and queries need to be followed up and shipping status tracked through
web procedures.

The final stage involves fully-fledged e-commerce. This encapsulates all the
information processing of the previous stages, plus more interactive features,
personalisation and CRM2 tools, for instance.

Electronic Data Interchange


Customer Relationship Management
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The final outcome is the integration of all these activities with the internal processes
of a business. The focus is a customer service orientated e-business.
4.
FACTORS THAT AFFECT E-COMMERCE ADOPTION
The factors that affect e-commerce adoption are useful in determining the reason why an
SME is at a certain level. These adoption factors are a result of the owners business outlook
as well as the organisations characteristics (Courtney and Fintz, 2001):

Owner's Characteristics

As mentioned earlier, adoption is heavily reliant on the acceptance of e-commerce by


the business owner. If the owner neither perceives the technology to be useful, nor
understands its potential, then s/he will be reluctant to adopt it (Iacovou et al., 1995).
The level of computer literacy of the owner and a lack of knowledge on how to use
the technology will result in the business being less likely to adopt e-commerce
(Kirby and Turner, 1993). Julien and Raymond (1994) found that level of
assertiveness and rationality of the owner in decision making would make the owner
more likely to adopt the use of e-commerce if it suited the organisation.
If the owner is subjective and refers to the opinions of experienced people who
recommend the adoption of e-commerce into the organisation, then he is also more
likely to accept their opinions (Harrison et al., 1997). SME owners are also
concerned with return on investment. The pressure to show a return often leads to
small firms being more concerned with medium-term survival rather than long-term
viability (Akkeren and Cavaye, 1999). As a result, owners are often hesitant to make
substantial investments when short-term returns are not guaranteed.

Organisation's Characteristics

A number of factors that effect adoption of e-commerce have to do with the


organization itself. The amount of technology currently in use in the organization,
such as PCs with modems and email facilities can ease the process of adoption
(Iacovou et al., 1995). Adoption has also been found to be largely dependent on
external pressure from the business competitors as well as its supply chain (Thong
and Yap, 1995; Kirby and Turner, 1993). Businesses might adopt e-commerce as a
result of their competitors using it so as not to lose their competitive advantage. If an
organisation has large amounts of data and transactions, then it is more likely to
adopt IT which can help streamline operations and offer process efficiencies within
the organisation (Thong and Yap, 1995).
In their research on small businesses, Akkeren and Cavaye (1999) found two factors
affecting IT adoption that had previously not been recognised. The first was mistrust
of the IT industry as some owners perceived the IT industry to be 'over-selling' the
benefits of technologies and misinforming them. The second factor was a lack of
time to get acquainted with the opportunities and challenges of the Internet due to its
quick evolution rate.

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Contextual characteristics

The economic benefits of moving business transactions from fax, telephone and post
to the Internet are well documented in many publications (Davies, 2002). Wilde and
Swatman (2000, p.10) also noted that the forces of economic rationalism and
globalism have enhanced the market as the final arbiter of price and service with the
balance of power tilting from the manufacturer towards the consumer. Given this
erosion of margins, companies need to reduce costs, both in production and
transaction, in order to make their products and services more competitive. This again
points to the Internet as a vehicle to reduce costs and to assist in obtaining a
competitive advantage in the short term.
The traditional value chain has become virtualized to a great extent due to the fact
that users of the Internet are able to order products and services online, without
intervention of the purchasing department, while payment is made electronically
using electronic funds or purchase cards. The primary activities in the Porter Value
Chain, namely incoming logistics, outgoing logistics, marketing and sales, are being
redefined in terms of how they are carried out and interact with each other, as
technology provides for more sophisticated methods of business interactions (Walton
and Miller, 1995. Porter, 1985).
These chains have become virtualised as the Internet was increasingly used as a
binding agent (Davies, 2002). Dobbs (1999, p.2) describes value chain integration
as a process of collaboration that optimizes all internal and external activities
involved in delivering greater perceived value to the ultimate consumer. In the
process whole portions of the previous chain are being removed, redefined or
disintermediated.
It is however necessary to note that the integration of value chains does not solve all
problems. JIT (Just in Time) production is a methodology of reducing inventory stock
that has been used for many years and serves as an example to prove this point.
Critics of this method have pointed out that it merely forces the lower level
manufacturer to hold stock and deliver to the client as needed. This method does
however reduce stock holding costs throughout the higher levels of the value chain. It
is also interesting to note that the Internet plays an increasingly important role with
JIT ordering due to the ease of ordering at short notice.
Researchers have further identified a number of additional issues that impact the
adoption of e-commerce. These are summarised by Courtney and Fintz, (2001):

Low use of E-commerce by Customers and Suppliers. This means that there is little
incentive for SMEs to engage e-commerce until their customers and suppliers are
also using it.
Concerns about security aspects.
Concerns about legal and liability aspects.
High costs of development and computer and networking technologies commerce.
Limited knowledge of e-commerce models and methodologies.
Unconvinced of benefits to the company.

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5.
RESEARCH R ESULTS
There are currently 230 small manufacturing businesses registered with the Cape Chamber of
Commerce. On analysis of these businesses, it was found that 35 businesses had been entered
twice into the Cape Chamber of Commerces database. Eventually 195 questionnaires were
sent out. 15 companies informed us that they had been incorrectly classified by the Cape
Chamber of Commerce and were not small businesses. A further 11 businesses appeared to
have closed down or changed their contact details and were therefore unavailable. Out of the
169 businesses in the sample, we received 34 responses. This is a 20% response rate. These
companies were supplied with questionnaires through e- mail, faxed or posted information.
Companies were furthermore contacted telephonically to confirm that they had received our
questionnaire and to encourage them to respond.
(a)

The first hypothesis tested whether small manufacturing businesses perceive the
potential benefits of e-commerce as important (Appendix 1).

By taking the total number of answers (10 benefits*34 small businesses = 340) and
calculating the total number of answers in each category, we were able to work out the
percentage of responses in each category. It was found that 50% (170) of the answers fell in
the important and very important section, 24% (81) of answers fell in the neutral category and
26% (89) of the answers fell into the unimportant section. It can therefore be concluded that,
overall, small manufacturing businesses have a positive outlook towards e-commerce and
view the benefits of e-commerce as important to their business.
Important

Neutral

a) Improve information exchange with customers

61.7

38.2

Unimportant
0

b) Increase customer loyalty

44.1

29.4

26.4

c) Increase service to the customer

61.7

20.5

17.6

d) Easier access to international markets

61.7

14.7

23.5

e) Expand business reach

61.7

17.6

20.5

f) Reduce costs of maintaining up -to-date company information

44.1

29.4

26.4

g) Improve information exchange with suppliers

61.7

23.5

14.7

h) Reduce costs through web based purchasing and procurement

17.6

35.2

47.0

i) Improve the competitive position of your company

52.9

20.5

26.4

j) Attract new investment to the company

32.3

8.8

58.8

Table 1: Percentages for Importance of E-commerce Benefits

(b)

The second hypothesis tested whether small manufacturing businesses have the
necessary technological capabilities in place for e-commerce adoption (Appendix
1).

For the purposes of this research, technological capabilities refer to entry- level ecommerce activities. In order to test whether small manufacturing businesses have the
necessary infrastructure in place for e-commerce adoption to occur, it was necessary to
observe current technological capabilities. The respondents were hence asked to base their
response on 5 criteria as in the survey. The results are indicated in Table 2.

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Now

1Year

3Years

>3Years

Never

a) A company strategy for developing electronic commerce

26.4

20.5

44.1

8.8

b) A computerised database of your companys customers

73.5

11.7

5.8

8.8

c) A computerised database of your companys suppliers

61.7

17.6

8.8

8.8

2.9

d) A computerised inventory of your companys products or services

67.6

14.7

8.8

8.8

e) Company electronic mail (e-mail)

94.1

5.8

f) Company access to the Internet on a dial-up line

85.2

2.9

5.8

5.8

g) Company access to the Internet on a dedicated or leased line

38.2

11.7

20.5

14.7

14.7

Table 2: Percentages for Adoption of Technological Capabilities

It is clear from Table 2 that the majority of businesses have adopted most of the
technological capabilities required for the adoption of more sophisticated e-commerce
capabilities. It is also noticeable that only 26%, (9) of these businesses have a strategy for
developing e-commerce in their organisation, despite the high level of infrastructure currently
in place.
(c)

The third hypothesis tests whether small manufacturing businesses in the Western
Cape have adopted the use of sophisticated e-commerce capabilities (Appendix 1).

Table 3 presents the results as percentages of e-commerce capabilities adopted by


small businesses within the manufacturing sector in the Western Cape. From the results it can
be concluded that most businesses surveyed did not currently have advanced e-commerce
capabilities.
Now

1Year

3Years

>3Years

Never

a) A website demonstrating the companys products or services

64.7

14.7

11.7

8.8

b) Customer orders received through an Internet Website

17.6

20.5

35.2

20.5

5.8

c) Customer payment by credit card through the Internet

14.7

14.7

35.2

14.7

20.5

d) Customer services provided on the Internet

23.5

17.6

26.4

17.6

14.7

e) Placing orders with suppliers over the Internet

20.5

23.5

38.2

11.7

5.8

f) Making payments to suppliers over the Internet

55.8

2.9

26.4

2.9

11.7

Table 3: Percentages for Adoption of E-commerce

(d)

Figure 2 summarises the individual analysis of each inhibitor that was tested in
this survey (Appendix 1). A clearer picture of whether or not respondents agreed
or disagreed with the identified inhibitor can be seen in some detail.

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Inhibitors to E-commerce

Company has concerns about legal issues, contracts and liability


Company has concerns about internet security
Telecommunications services not dependable
Cost of computers and network technologies are too high
Level of computerisation is too low in the company
E-commerce use is too low among suppliers
E-commerce use is too low among customers
Company has limited knowledge of the required technology
Company not convinced of the financial and business benefits

10

15

20

25

30

35

40

Number of Respondents
Strongly Disagree

Disagree

Neutral

Agree

Strongly Agree

Figure 2: Summary of Inhibitors to E-commerce Adoption

The above information on the inhibitors of e-commerce adoption shows an


inconclusive response. The only two conclusive results are that 64,7% (22) of respondents
felt that a major inhibitor to the adoption of e-commerce is that e-commerce use is too low
among customers. A further 50% (17) of respondents felt that e-commerce use among
suppliers is too low. It would seem that because e-commerce use among customers and
suppliers is low, there would be little incentive to adopt e-commerce first.
Other relatively significant limitations to the adoption of e-commerce include that the
business has limited knowledge of the required technology, and the business has concerns
about Internet security (both inhibitors have 38,2% (13) of respondents agreeing). 32,3% (11)
of respondents mentioned that they are concerned about the legal issues, contracts and
liability linked to e-commerce activities. No conclusive results could be drawn from the
remaining four identified inhibitors.
6.
DISCUSSION
The use of the Internet by SMEs in South Africa would appear to be in its infancy. BMITech-Knowledge report SME Technology Barometer 1999-2000 claims that only 16% of
SAs SMEs are already conducting some form of electronic commerce, while 31% believe
they will never use electronic commerce (Trialogue, 2000, p182). In another survey, Viviers
and Sootinis (1999, p.5), found SMEs only use the Internet for 10% of information
acquisition requirements, the rest was via journals, trade fairs, business contacts, and the like.
These figures, viewed in relation with the research results for the Western Cape, clearly show
the need for governmental, or private, assistance to help with the provision of infomediary
services in this sector.
This research paper looked at small manufacturing businesses perception of the
benefits of e-commerce in order to determine their acceptance of this business method.
Current levels of e-commerce adoption, as well as future intentions to adopt, were
determined. Analysis of the data led to the following conc lusions:
Hypothesis One:
Small Manufacturing Businesses perceive the potential benefits of ecommerce as important.
By asking small manufacturing businesses to evaluate the benefits of e-commerce for
their business, it was found that the potential benefits were perceived to be important. It is

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EJISDC (2002), 10, 4, 1-13

now up to the SMEs, with or without assistance from governmental or other incentives, to
use this technological tool to improve their business scope.
Hypothesis Two:
Small Manufacturing Businesses have the necessary technological
capabilities in place for e-commerce adoption.
The vast majority of small manufacturing businesses have the required technological
capabilities in place. This infrastructure can be used as a foundation on which to build more
sophisticated e-commerce capabilities, such as online ordering, payment and transactions.
Hypothesis Three: Small Manufacturing Businesses have adopted the use of e-commerce.
The majority of small manufacturing businesses have not currently adopted e-commerce
activities into their businesses. It was found that most of these businesses have plans to
implement e-commerce activities within the next three years.
To advise these SMEs on the road forward, it might be interesting to note what
happened in the Australian case. Castleman and Cavill (2001, p8) reported on advice from
SMEs who had implemented electronic commerce:

Realistic knowledge and expectations of electronic commerce and its export


potential: much information was misleading or useless, physical contact and
interaction was necessary to gain information as virtual presences were insufficient to
deal with relationship building, problem resolution and other issues.

Linking electronic commerce to business goals: a good understanding of the


strategic goals and how government incentives and EC drive from the private sector
can help to achieve these goals. The role of planning cannot be overstated in this
regard.

Implementation arrangements: senior management commitment was crucial; skills


requirements needed to be redefined as well as adequate training needed.

7.
CONCLUSION
A number of factors affect e-commerce adoption. These are a result of the owners perception
and acceptance of e-commerce, characteristics of the organisation, and the context in which
the business finds itself. Various benefits and inhibitors to e-commerce adoption have been
identified. As e-commerce matured over the last few years, a growing awareness and
understanding of the benefits and uses of e-commerce among SMEs emerged.
On the other hand, Akkeren and Cavaye (1999), and Poon and Swatman (1999) have
found that many SMEs often perceive the benefits to be irrelevant or not appropriate to their
organisation. As a result of this lack of acceptance, they say the tendency is for SMEs to be
extremely cautious and hesitant when deciding to adopt e-commerce activities into their
organisation.
There has been a lack of research undertaken in South Africa to determine small
businesses perception of the benefits of e-commerce and the current leve l of e-commerce
adoption. This study has shown that manufacturing businesses in the Western Province of
South Africa have not yet adopted sophisticated e-commerce procedures and are unlikely to
do so, unless some organisational incentives or government assistance are offered. The study
also indicates the reasons why the deployment of e-commerce in this sector is slow. Further
research is strongly recommended to monitor e-commerce perceptions and adoption
strategies as an ongoing study, extended to a wider population to monitor and compare
regions in Southern Africa.
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8.

10

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APPENDIX 1 : TESTS FOR ASSOCIATION


Association Test for Hypothesis One
Correspondence Analysis was used to determine whether an association exists between the
identified benefits of e-commerce. The hypotheses are:
H0 : No Association Exists between the benefits of E-commerce
H1 : Association Exists between the benefits of E-commerce
The table below shows the statistical method used to test if an association exists between the
benefits of e-commerce.
Eigen Values and Inertia for all Dimensions (benefits.sta)
Input Table (Rows x Columns): 10 x 3
Total Inertia=.16767 Chi=57.008 df=18 p=.00001
Singular
EigenPerc. of
Cumulatv Chi
Values
Values
Inertia
Percent
Squares
1
0.357837 0.128047 76.36884 76.3688
43.53612
2
0.199053 0.039622 23.63116 100
13.47158

This table calculates the Chi-squared value of 57,008 with a p-value = 0,0001. As p<0,05 we
can conclude that the result is statistically significant, and thus we reject H0 . Association
therefore exists between the benefits of e-commerce.
Association Test for Hypothesis Two
Correspondence Analysis was used to determine whether an association exists between the
technological capabilities require for the adoption of more sophisticated e-commerce
activities. The hypotheses are:
H0 : No Association Exists between the technological capabilities required for ecommerce adoption
H1 : Association Exists between the technological capabilities required for ecommerce adoption

The Electronic Journal on Information Systems in Developing Countries,


http://www.ejisdc.org

EJISDC (2002), 10, 4, 1-13

12

The table below shows the statistical method used to test if an association exists between the
e-commerce capabilities tested.
Eigen Values and Inertia for all Dimensions (capabilities.sta)
Input Table (Rows x Columns): 7 x 5
Total Inertia=.36723 Chi=87.401 df=24 p=0.0000
Singular
EigenPerc. of
Cumulatv Chi
Values
Values
Inertia
Percent
Squares
1
0.508243 0.25831
70.34039 70.3404
61.47788
2
0.290488 0.084383 22.9783
93.3187
20.08316
3
0.152885 0.023374 6.36488
99.6836
5.56294
4
0.034089 0.001162 0.31644
100
0.27657

This table calculates the Chi-squared value of 87,401 with a p-value = 0,0000. As p<0,05 we
can conclude that the result is statistically significant, and thus we reject H0 . Association
therefore exists between the identified technological capabilities required for e-commerce
adoption.
Association Test for Hypothesis Three
Correspondence Analysis was used to determine whether an association exists between the
main capabilities of e-commerce. The hypotheses are:
H0 : No Association Exists between the adoption of e-commerce capabilities
H1 : Association Exists between the adoption of e-commerce capabilities
The table below shows the statistical method used to test if an association exists between the
e-commerce capabilities tested.
Eigen Values and Inertia for all Dimensions
(ecommerce.sta)
Input Table (Rows x Columns): 6 x 5
Total Inertia=.24566 Chi=50.115 df=20 p=.00022
Singular
EigenPerc. of
Cumulatv
Values
Values
Inertia
Percent
1
0.422238 0.178285 72.57399 72.574
2
0.224555 0.050425 20.52626 93.1002
3
0.116373 0.013543 5.51276
98.613
4
0.058372 0.003407 1.387
100

Chi
Squares
36.37018
10.28666
2.7627
0.69509

This table calculates the Chi-squared value of 50,0115 with a p-value = 0,0022. As p<0,05
we can conclude that the result is statistically significant, and thus we reject H0 . Association
therefore exists between the adoption of e-commerce capabilities

The Electronic Journal on Information Systems in Developing Countries,


http://www.ejisdc.org

EJISDC (2002), 10, 4, 1-13

13

Association Test for Inhibitors of E-commerce Adoption


Correspondence Analysis was used to determine whether an association exists between the
main capabilities of e-commerce. The hypotheses are:
H0 : No Association Exists between the inhibitors of e-commerce adoption
H1 : Association Exists between the inhibitors of e-commerce adoption
The table below shows the statistical method used to test if an associa tion exists between the
inhibitors of e-commerce adoption.
Eigen Values and Inertia for all Dimensions (inhibitors.sta)
Input Table (Rows x Columns): 9 x 3
Total Inertia=.11449 Chi=35.035 df=16 p=.00394
Singular
EigenPerc. of Cumulatv
Chi
Values
Values
Inertia
Percent
Squares
1
0.275131 0.075697 66.11483
66.1148
23.16333
2
0.196968 0.038796 33.88517
100
11.87167

This table calculates the Chi-squared value of 35,035 with a p-value = 0,0394. As p<0,05 we
can conclude that the result is statistically significant, and thus we reject H0 . Association
therefore exists between the inhibitors of e-commerce adoption.

The Electronic Journal on Information Systems in Developing Countries,


http://www.ejisdc.org

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