INFLUENCING FACTORS FOR THE ADOPTION OF

m-COMMERCE APPLICATIONS

A Multiple Case Study

Saira Ashir Zeeshan, Yen Cheung and Helana Scheepers

Monash University, Australia

Keywords: Mobile-Commerce, Adoption, Factors, Case Study.

Abstract: In the last few years mobile-commerce (m-commerce) has evolved providing its users set of applications

that provide greater communication and flexibility. As these m-commerce applications become popular,

organizations are adopting them to provide these services to their customers. This paper explores the

influencing factors involved in the adoption of m-commerce applications by organizations. The research

question that is addressed in this paper is: What factors affect an organization’s decision to adopt m-

commerce? In order to answer the research question a research model adapted from the framework

presented by Wang and Cheung (2004) is proposed. The research model examines the influencing factors

under three levels: organizational, environmental and managerial. A multiple case study approach is

employed as a research method to validate the research model. Findings from this research enhance research

in m-commerce as well as assist businesses to better plan their adoption of m-commerce applications.

1 INTRODUCTION

Mobile-commerce (m-commerce) has evolved and

provides its customers a set of applications and

services which people can access from their web

enabled mobile devices such as mobile phones,

personal data assistants (PDA), and laptops

(Venkatesh, Ramesh and Massey 2003). The

adoption and diffusion of such m-commerce

applications provide opportunities for organizations

and individuals to communicate and exchange

information and also engage in commercial

transactions anywhere and anytime, without the

constraints of time and location (Scheepers and

McKay 2004). Due to the anywhere and anytime

features of m-commerce applications organizations

are adopting m-commerce to provide services to

their customers. For example the health care

industry is embracing m-commerce solutions to

improve health care quality by safely providing

patient-centered, equitable, timely and effective care

to its patients (Goldberg and Wickramasinghe 2003;

Burley, Scheepers and Owen 2008). Other

businesses such as restaurants have also

implemented mobile solutions to replace their

previous paper-based process of taking orders from

customers, enabling waiters to relay orders directly

from the table to the appropriate section (Scheepers

and Scheepers 2008). Due to this rapid adoption of

m-commerce there is a need to investigate factors

behind the adoption of m-commerce in organizations.

In the past, researchers have investigated m-

commerce adoption from a customer’s perspective.

However to date, insufficient research has been

conducted to identify and evaluate the factors that

influence organizations to productively and

profitably implement m-commerce applications.

This lack of knowledge will prevent decision makers

from making critical decisions while implementing

m-commerce in organizations.

In order to address this research gap, a research

model consisting of influential factors under

managerial, organizational and environmental levels

(adapted from Wang and Cheung (2004)) is

proposed. The case study research methodology is

used to evaluate the factors in the research model.

Thus the paper attempts to answer the following

main research question: What factors affect an

organization’s decision to adopt m-commerce?

The rest of the paper is structured as follows: the

following sections presents the technology adoption

literature reviewed from the organizational

perspective, which is used for the development of

Ashir Zeeshan S., Cheung Y. and Scheepers H. (2009).

INFLUENCING FACTORS FOR THE ADOPTION OF m-COMMERCE APPLICATIONS - A Multiple Case Study.

In Proceedings of the 11th International Conference on Enterprise Information Systems - Software Agents and Internet Computing, pages 53-60

DOI: 10.5220/0001864300530060

 SciTePress

P1: H1 to H6

P4: H11 to H12

P2: H7 to H9

P3: H10

P5: H13

Information Applications

Transaction-based Applications

Entertainment Applications

Location-based Applications

Telemetry Applications

M-Commerce Applications

ENVIRONMENTAL FACTORS

MANAGERIAL FACTORS

ORGANIZATIONAL FACTORS

Perceived Benefits

Availability of Resources

Innovation Orientation

M-Commerce Adoption Factors

Figure 1: Research Model for Adoption of M-Commerce Applications.

the research model. Next, the research model is

presented followed by the research method, selection

of cases and strategy of data collection. The paper

concludes with the empirical findings of the multiple

cases.

2 LITERATURE REVIEW

Diffusion of innovation (DOI) theory proposed by

Rogers (1995), has been employed by many scholars

to study the innovation diffusion in organizations.

It explains innovations as being communicated

through certain channels overtime and within a

particular social system. Further, Rogers (1995)

states that the relative advantage, complexity,

compatibility, trialibility and observability are the

factors that influence the rate of innovation adoption.

Most researchers have adopted DOI as a theoretical

foundation for their conceptual model in order to

study the innovation characteristics of organizational

technology adoption. For example, Prasad,

Scornavacca et al. (2005) used Rogers (1995) DOI

model as a basic guide for examining the impacts of

the adoption of mobile devices in a restaurant

setting. While exploring the perceived benefits of

using Personal Digital Assistant (PDA’s) in a

restaurant, in a B2E context they found that

increased efficiency, speedier service, better

usability and ease of use, enhanced reputation/image

and increased accuracy were the most common

perceptions. Their findings also indicated that

relative advantage, compatibility, complexity and

observability were contributing factors for the

adoption of the system (Prasad et al. 2005). Further,

perceived ease of use and perceived usefulness were

found to be prominent factors during early stages of

technology adoption.

Rogers (1995) argued that the organizational

adoption decision can be influenced by a

combination of environmental, organizational and

managerial factors. Based on Rogers (1995)

argument, Wang and Cheung (2004) presented a

multilevel framework and studied seven factors

under three levels to investigate e-business adoption

by travel agencies. They concluded that external

competitive pressure, innovation orientation,

financial slack, IT resources, CEO’s risk taking

propensity and organization size were found to have

a profound effect on e-business adoption.

3 RESEARCH MODEL

Based on the above literature, a research model

consisting of influential adoption factors under

managerial, organizational and environmental levels

is proposed. The model is adapted from Wang and

Cheung (2004) because 1) it explored the adoption

factors from organizational perspective and 2), it

was based on Rogers (1995) argument that the

organizational adoption decision can be influenced

by a combination of environmental, organizational

and managerial factors.

Level one presents organizational factors. These

factors include perceived benefits, availability of

organizational resources and innovation orientation.

Enhanced communication, flexibility, better

response time, task effectiveness, decreased

operational cost and increased customer service are

discussed under perceived benefits. Where as,

availability of technological, financial and human

resources are discussed under availability of

organizational resources. Level two present

environmental factors in which institutional pressure

and competitive pressure are discussed. Level three

present the managerial factor in which top

management support is discussed.

Based on the theoretical viewpoint, propositions are

developed. Each proposition is associated with its

corresponding factor. As illustrated by Shank and

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Parr (2003), “terms in propositions belong to

abstract world of theory”.

“Each of the terms must be assigned an empirical

indicator. These empirical indicators are then

substituted into the propositions to form a

corresponding hypothesis”.

Hypotheses are then deduced from these

propositions to empirically test the proposed factors.

Figure 2 presents the proposed research model

which depicts the thirteen proposed hypotheses.

Each hypothesis was linked to its particular factor.

Detail description of these factors under the three

levels is discussed below.

The m-commerce applications shown in the

research model are business-to-consumer (B2C) m-

commerce applications and are implemented to

create an alternative conduit between the

organization and its customers. These applications

create direct value to the customer which results in

customer satisfaction. For instance, mobile

advertising is an alternative and powerful marketing

channel for the organizations to communicate with

their customers (Varshney and Vetter 2002).

These applications benefit businesses in two

main areas such as operational efficiency and

customer service (Leung and Antypas 2001). These

applications are generally categorized into five

categories such as information applications,

entertainment applications, location-based

application, transaction-based applications and

telemetry applications (see for example (Senn 2000;

Coursaris and Hassanein 2002; Wang, Song, Lei

and Sheriff 2005)).

3.1 Organizational Factors

The internal organizational factors are categorized

into perceived m-commerce benefits, perceived ease

of use and innovation orientation.

The adoption of IT brings significant

opportunities for organizations (Sheng, Nah and

Siau 2005). These IT opportunities can be classified

into tangible and intangible benefits (Sheng et al.

2005) . Organizational profitability and cost savings

are tangible benefits which focus on the financial

performance of the organization (Sheng et al. 2005)

whereas, customer services (Leung and Antypas

2001), efficiency and effectiveness of the work

processes (Burley et al. 2008) are known as

intangible benefits (Sheng et al. 2005). In this study,

the main focus is to examine the importance of

intangible benefits such as enhanced communication,

flexibility, better response time, better customer

service and effectiveness of the work tasks in the

adoption process. Decreased organizational

operational cost which is a tangible benefit was also

investigated during the study to examine the

financial gain of the organization and its importance

in the adoption process.

According to Davis (2002) anyplace/ anytime

computing can remove the constraints of time and

space to access critical information and enhance

capabilities for communication and coordination.

Increased communication results in improved

information quality and relationship (Boadi, Boateng,

Hinson and Opoku 2007). The flexibility, ubiquity

and convenience of m-commerce services provides

timely information to its users/customers anywhere

and anytime (Anckar, Carlsson and Walden 2003)

resulting in customer satisfaction. In addition, m-

commerce increases the effectiveness of the tasks by

speedier services/reduced task completion time

(Branes 2002; Gebauer and Shaw 2004).

Effectiveness is defined as measuring whether the

task has achieved the intended objectives (Burley et

al. 2008). The effectiveness of the organization’s

activities is achieved through the benefits provided

by m-commerce applications such as connectivity,

flexibility, interactivity and location awareness

(Sheng et al. 2005).

As a result of better job performance through

increased and timely communication and speedier

service, organizational operational cost is decreased

(Boadi et al. 2007). Based on the above mentioned

benefits the following was proposed:

Proposition 1: Perceived m-commerce benefits have

a positive relationship with the adoption of m-

commerce applications.

Although m-commerce provides novel features

like enhanced and flexible communication, however,

organizations have to consider factors such as

availability of IT technology, human resources, set

up and operating costs (Anckar et al. 2003; Feng,

Hoegler and Stucky 2006) before its adoption.

Availability of technological, human and financial

resources will enable organizations to adopt and use

the technology.

Technological resources in the context of m-

commerce applications refer to wireless network

equipment, wireless access devices such as mobile

phones, wireless application protocol used by the

mobile devices to conduct m-commerce activities

and customized applications made by application

developers (Leung and Antypas 2001; Coursaris

and Hassanein 2002; Zeeshan, Cheung and

Scheepers 2007). Moreover, financial resources

refer to a “pool of resources in an organization that

is in excess of the minimum necessary to produce a

INFLUENCING FACTORS FOR THE ADOPTION OF m-COMMERCE APPLICATIONS - A Multiple Case Study

given level of organizational output” (Wang and

Cheung 2004). Financial investment must be

available in the organization to bear the cost for

implementing new technology (Sharma, Citurs and

Konsynski 2007). Similarly, human expertise is

required to successfully implement any new

technology. In addition, it is also important to have

IT knowledge available within the organization in

order to adopt and use m-commerce (Wang and

Cheung 2004; Zeeshan et al. 2007). Based on the

above discussion the following proposition was

developed.

Proposition 2: Perceived availability of

organizational resources have a positive

relationship with the adoption of m-commerce

applications

The third issue discussed under organizational

factors is innovation orientation. As discussed by

Wang and Cheung (2004) and Zeeshan et al. (2007)

innovation oriented organizations implement new

technologies by making resource commitments and

create new products for their potential customers.

Following proposition was proposed related to

innovation orientation.

Proposition 3: Innovation Orientation have a

positive relationship with the adoption of m-

commerce applications

Hypothesis (H1 to H10) deduced from proposition 1,

2 and 3 are stated in the Appendix A.

3.2 Environmental Factors

Two types of pressures are discussed under

environmental factors: institutional pressure and

competitive pressure (Wang and Cheung 2004;

Zeeshan et al. 2007). Pressures from external

organizations such as resource dominant

organizations, supply chain partners and government

organizations can influence organization’s adoption

behavior (Wang and Cheung 2004; Sharma et al.

2007). Moreover, pressures from customers

readiness and organizational stakeholders groups

(e.g., customers and suppliers) are also related to

environmental factors (Wang and Cheung 2004;

Zeeshan et al. 2007). However, competitive

pressures originating from competitors, that create a

threat for the organization of falling behind in the

competition may influence organizations decision to

adopt an innovation (Wu, Mahajan and

Balasubramanian 2003; Wang and Cheung 2004;

Zeeshan et al. 2007). The following proposition was

proposed related to environmental factors.

Proposition 4: Environmental factor have a positive

relationship with the adoption of m-commerce

applications

Hypothesis (H11 and H12) deduced from

proposition 4 are stated in the Appendix A.

3.3 Managerial Factor

Top management support is a critical factor because

m-commerce adoption requires technological,

human and resource commitment, which cannot be

invested without managerial permission (Wu et al.

2003). Top management support is also required to

facilitate organizational learning process during the

adoption and use of m-commerce. Hence, the

following proposition was developed in relation to

managerial factors.

Proposition 5: Management support have a positive

relationship with the adoption of m-commerce

applications

Hypothesis (H13) deduced from proposition 5 are

stated in the Appendix A.

4 RESEARCH METHOD

Case study methodology is used to explore new

areas of research such as adoption of m-commerce

applications (Eisenhardt 1989). The case study

approach is also selected for the following reasons.

First, it helps in understanding the research

phenomena (m-commerce adoption factors) in its

natural settings (Benbasat, Goldstein and Mead

1987; Yin 1994; Cavaye 1996). Second, the case

study method aligns with the aim of this research

which is to empirically validate the framework for

he adoption of m-commerce within the organizations.

Furthermore, a multiple case study approach is

chosen in this research. Based on the literature

available (Harriott and Firestone 1983; Yin 1994;

Cavaye 1996; Premkumar, Ramamurthy and

Nilakanta 1997), the following arguments are used

to justify the selection of multiple-case study as a

selected research method for this research study.

Firstly, multiple case study method offers better

chances to increase construct validity. Secondly,

evidence from multiple cases is often considered

more compelling; it makes the overall study more

robust and reliable.

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5 SELECTION OF CASES

As suggested by Paton (1990) the selection of

information-rich cases is highly desirable for in-

depth study. In order to ensure that the appropriate

and information-rich cases are selected, the selection

process is guided by the fact that case organizations

must have used or are willing to use m-commerce

applications as an alternate channel to communicate

with their customers. Secondly, the case

organizations must have practical exposure to the

adoption process and lastly the case organizations

should be willing to participate in this research. The

multiple cases selected for this research are three

organizational units: Library Services, Health

Services and Examination Services, of the same

university in Australia. The three organizational

units had adopted SMS applications for sending

notifications. Information about due or over due

books and fines is sent to the students in the case of

Library Services, exam results are sent to the

students in the case of the Examination Services and

patients are notified of their upcoming appointments

in the case of the Health Service.

6 STRATEGY FOR DATA

COLLECTION

The selection of interviewees from the

organizational units is also crucial. The interviewees

were selected based on the critical role they played

during the adoption process of the m-commerce

application. The director of the Library Central

Services and the IT manager was selected from the

Library case, the practice manager was selected

from the Health Services and the examination

manager was selected from the Examination

Services.

Further the data collection process for this

research was primarily based on the formal in-depth

interviews with the key informants from each case.

The data was collected in the period June 2007 to

September 2007. To conduct the formal interview,

an interview protocol was developed. The interview

protocol was based on the initial research question,

propositions and hypothesis. After the data

collection phase the data was summarized and then

structured in a tabulated form in order to test each

hypothesis. The results were then analyzed by

pattern matching and explanation building (Yin

1994). The patterns or explanations of the factors

were also analyzed. From this analysis conclusions

about the adoption factors were drawn.

7 RESEARCH FINDINGS

Summary of the outcome of the hypothesis from the

three organizational units is presented in Appendix

A. Much of the discussion in this section is based

on the data in Appendix A, and also on the

transcribed interviews with participants.

It was previously mentioned that the

organizational factors are categorized into perceived

m-commerce benefits, availability of organizational

resources and innovation orientation. In the case of

perceived m-commerce benefits as an organizational

factor it is concluded that all three organizational

units acknowledged intangible benefits, such as

enhanced communication, flexibility, better response

time, increased organizational task effectiveness and

improved customer service after their first trial of

SMS application. However, the management in the

current cases is unaware or unable to measure some

of the tangible benefits (such as reduced operational

cost) emanating from the SMS services and affecting

their related internal business processes. The

empirical results, however, seem to indicate that

organizational units experimented with the m-

commerce technology without careful evaluation of

tangible and intangible benefits. Moreover, the

interviewees suggested that they would like to adopt

new innovative technology which support the

proposition that innovative organization are more

likely to adopt m-commerce applications. However,

it is suggested that cost/benefit analysis must also be

done by the innovative organizations before

investing their resources into the m-commerce

application (Scheepers and Scheepers 2008) to fully

understand the impact the new technology will have.

Availability of financial resources is one of the

most important organizational factors in the

adoption of m-commerce applications. It is difficult

for the organizational units operating within limited

budgets to adopt and operate an expensive m-

commerce applications. It is therefore important for

the organizations to consider the overall benefits

against the total cost of the investment overtime and

should invest only if the benefits exceed the total

cost of m-commerce adoption (Scheepers and

Scheepers 2008). Furthermore, from the case

studies it is evident that the availability of IT human

resources and well maintained technological

resources (computers, networks, softwares,

databases) played a major part in the university

INFLUENCING FACTORS FOR THE ADOPTION OF m-COMMERCE APPLICATIONS - A Multiple Case Study

environment. The availability of these resources

provided the organizational units the ability to

experiment with m-commerce application without

carefully conducting the financial appraisal of the m-

commerce investment.

In the case of the Library Services competitive

pressure is found to be a stronger environmental

force than institutional pressure. In the case of the

Examination Services however client readiness was

identified as a influencing factor..

M-commerce adoption decisions are effected by

the manager’s perceptions of the environmental and

organizational conditions (Wang and Cheung 2004).

It is important for management to realize the

benefits of the technology and estimate the cost of

the investment prior to its implementation. In the

case of the Health and Examination Services top

management support played a major role in the

adoption of m-commerce applications as they

realized the benefits of the application. However, in

the case of Health Services the management viewed

the SMS application as an expensive innovation and

hence did not continue the use after the initial trial

period. Therefore it is concluded that the availability

of financial resources and management support is

the most critical factor in the m-commerce adoption

decision.

Hence, the empirical evidence provided in

appendix A show that intangible m-commerce

benefits (H1 to H5), availability of technological

(H7) financial (H8) and human (H9) resources,

organizational innovativeness (H10) and top

management support (H13) are important

influencing factors in the m-commerce adoption.

However, further research should be conducted for

the evaluation of the following factors: reduced

operational cost (H6), competitive and institutional

pressure (H11 and H12), as these factors were not

unanimously supported by all three cases.

Similar outcomes can be expected in other

universities which have similar financial resources

and facilities available. Further research is however

required in commercial organizations and other

industries to validate the findings.

The above findings contribute to building an

empirical foundation for understanding the adoption

of m-commerce in the organizations. The theoretical

research model can be used as a basis for further

research and development.

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INFLUENCING FACTORS FOR THE ADOPTION OF m-COMMERCE APPLICATIONS - A Multiple Case Study

APPENDIX

Appendix A: Outcome of Hypothesis.

Hypothesis

Library Services Healt h Services Examination

Director Manager Manager Manager

S PS NS S PS NS S PS NS S PS

H1: Enhanced communication has a positive

relationship with the adoption of m-commerce

applications

H2: Flexibility has a positive relationship

with the adoption of m-commerce applications

H3: Better response has a positive

relationship with the adoption of m-commerce

applications

n/a n/a n/a

H4 : Increased task effectiveness has a

positive relationship with the adoption of m-

commerce applications

H5: Improved customer service has a positive

relationship with the adoption of m-commerce

applications

H6: Decreased operational has a positive

relationship with the adoption of m-commerce

applications

3 3

H7: Availability of technological resources

has a positive relationship with the adoption

of m-commerce applications

H8: Availability of financial resources has a

positive relationship with the adoption of m-

commerce applications

H9: Availability of human resources has a

positive relationship with the adoption of m-

commerce applications

H10: Innovation orientation has a positive

relationship with the adoption of m-commerce

applications

H11: Institutional pressure has a positive

relationship with the adoption of m-commerce

applications

3 3

H12: Competitive pressure has a positive

relationship with the adoption of m-commerce

applications

H13: Top management has a positive

relationship with the adoption of m-commerce

applications

Legend: S= Supported, PS= Partially Supported, NS= Not Supported

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