Vital Strengthening of SMES through E-Commerce Adoption Purposeful

Yuniarty

, Hartiwi Prabowo

and Enny Noegraheni

BINUS Online Learning, Undergraduate Program BINUS University, Jl. Kh. Syahdan No. 9, Kemanggisan, DKI Jakarta,

Indonesia

BINUS Business School, Undergraduate Program BINUS University, Jl. Kh. Syahdan No. 9, Kemanggisan, DKI Jakarta,

Keywords:

Strategy, SMEs Empowerment, Competitiveness, Adoption of E-Commerce.

Abstract:

Within the time of globalization and quick advancement of information innovation, companies got to make

changes to internet-based commerce. These consider assesses the components that lead small to medium-

sized enterprises (SMEs) to embrace e-commerce. This investigate proposes an e-commerce adoption model

utilizing structural equation modeling that explore the impacts of Technological, Organizational, Environmen-

tal, and Individual variables on the SME’s e-commerce adoption purposeful. The population of the study

was SMEs producing snacks, such as roasted peanuts, banana chips, cassava chips, crackers, and so on in

Keranggan, Setu, Tangerang Selatan. The method of sampling was simple random sampling with 100 SMEs

as samples. The study utilized Structural Equation Modeling (SEM) with SmartPLS Program 3.0 for data

examination. Technological, Organizational, Environmental, and Individual variables were found to impact e-

commerce adoption purposeful signiﬁcantly and positively. In the Technological Aspect the biggest indicator

value was Relative Advantage which is increasing sales and proﬁts. Relative Advantage was also the biggest

indicator compared to indicators from other aspects.

1 INTRODUCTION

Small and Medium Enterprises (SMEs) have a vital

and key part of national ﬁnancial improvement. Other

than playing a part in ﬁnancial development and busi-

ness, SMEs moreover play a part in conveying im-

provement results. In the present, many people access

the internet, but there are still a few SMEs who use

it and are less aware of the importance of mastering

information technology (IT) can open wider opportu-

nities in business.

The Ministry of Cooperatives and Small and

Medium Enterprises (Kemenkop UKM) states that as

numerous as 3.79 million SMEs have utilized online

stages to advertise their items. This amount is around

8 percent of the overall SME owners in Indonesia,

which is 59.2 million (Service of Communication and

Data, 2019). The number of ecommerce players has

not however come to the target of the UKM Ke-

menkop program and the Service of Communication

and Data (Kemkominfo) titled 8 Million MSMEs Go

Online. In expansion, concurring to Deputy Access

Capital of the Creative Economy Agency (Bekraf)

Fadjar Hutomo said that computerized media plays a

critical part in all aspects of people’s lives nowadays,

counting within the trade division of SMEs.

To extend the competitiveness of SMEs as well

as to urge export opportunities and other commerce

openings can be done by utilizing the improvement

of information technology, particularly e-commerce,

not as it was utilizing the internet as a device to ad-

vance or look for trade openings, but also must be bal-

anced with great authoritative administration through

the use of the correct program. Site and ecommerce

improvement has to be done as a implies for advance-

ment and promoting of commerce items, so that it will

increment deals volume and increment income. This

increment in income will, in the long run, develop the

SMEs. This increase in income will eventually de-

velop the SMEs.

Keranggan village is located on the outskirts of

the Cisadane River, precisely in Setu District, South

Tangerang City. The extent the area of the Keranggan

SMEs community is around ± 50 hectares. Kerang-

gan village is a village where most of its citizens work

as snacks entrepreneurs, such as roasted peanuts, ba-

nana chips, cassava chips, crackers, and so on. The

production of the SME has been delivered out of the

Greater Jakarta area andsome have even been deliv-

ered to the outer islands. The activity of the commu-

160

Yuniarty, ., Prabowo, H. and Noegraheni, E.

Vital Strengthening of SMES through E-Commerce Adoption Purposeful.

DOI: 10.5220/0009880101600168

In Proceedings of the 2nd International Conference on Applied Science, Engineering and Social Sciences (ICASESS 2019), pages 160-168

ISBN: 978-989-758-452-7

nity business activities in Keranggan Village is a food

production business activity that is spread in most RT

12 and RT 13 and RT 11 areas. The total number

of SMEs in Keranggan is ± 150 SMEs. Most of

the activities carried out by the SMEs are still tradi-

tional, ranging from processing raw materials, cook-

ing, packing, and distributing manually.

The reasons for choosing the research unit are: (1)

The superior product contribution to the most signif-

icant per capita regional income; (2) Market orienta-

tion of superior products is abroad; (3) Optimizing the

use of local raw materials and (4) Empowering local

labor. For these reasons, the comes about of the study

will deliver a representation of the status of SMEs

within the ecommerce adoption process so it can be

utilized as a reference and thought for partners (neigh-

borhood governments) to empower prospect change

of prevalent items as a column of the neighborhood

economy.

The retail industry is no exception and most of

them embrace computerized impression to boost their

sales and revenue. Let alone meeting the targets, but

the brand outreach is one great takeaway from this

work out. The reason for this study is to distinguish a

comprehensive set of potential variables affecting the

adoption of e-commerce in SMEs. More particularly,

the consider builds a model of e-commerce adoption

and gives a better understanding of the appropriation

of e-commerce by SMEs.

The results will improve the understanding of

SME proprietors around the potential beneﬁts of

ecommerce and optimize the adoption of e-commerce

model by SME proprietors. A more prominent under-

standing around this will increment their likelihood to

distribute a few assets towards receiving e-commerce.

The study will donate experimental prove of variables

impacting the deliberate of receiving e-commerce in

SMEs.

2 LITERATURE REVIEW

Purposeful to adopt is broadly utilized as a dependent

variable in adopting different technologies (Zhu et al.,

2003) (Alamro and Tarawneh, 2011). Santhanamery

and Ramayah, 2013 deﬁne continuous intention as

”the intention of users to continue to use or long-term

use of technological intentions to ensure that technol-

ogy is better than the previous one.” The intention of

ebusiness adoption has been developed by (Drazin,

1991) (Grover, 1993)(Crook and Kumar, 1998) (Zhu

et al., 2002) (Nelson and Shaw, 2003) implement on-

line sales, online order raw materials to suppliers,

aggressively doing internet advertising, applications,

technology for information exchange. From a number

of references from several researchers, we adjust our-

selves in the context of SMEs in Keranggan Village.

Figure 1 describes the conceptual model.

Figure 1: Conceptual Model.

H1: Relative advantage has positive and note-

worthy impact to the adoption of ecommerce within

SMEs, H2: Compatibility has positive and notewor-

thy impact to the adoption of e-commerce within

SMEs, H3: Cost has positive and noteworthy im-

pact to the adoption of e-commerce within SMEs,

H4: Firm size has positive and noteworthy impact to

the adoption of e-commerce within SMEs, H5: Orga-

nizational readiness has positive and noteworthy im-

pact to the adoption of e-commerce within SMEs, H6:

Information intensity and product characteristics has

positive and noteworthy impact to the adoption of e-

commerce within SMEs, H7: Industry pressure has

positive and noteworthy impact to the adoption of e-

commerce within SMEs, H8: Government pressure

has positive and noteworthy impact to the adoption of

e-commerce within SMEs, H9: Consumer readiness

has positive and noteworthy impact to the adoption of

e-commerce within SMEs, H10: Support from tech-

nology vendors has positive and noteworthy impact to

the adoption of e-commerce within SMEs, H11: CEO

innovativeness has positive and noteworthy impact to

the adoption of e-commerce within SMEs, and H12:

CEOs involvement has positive and noteworthy im-

pact to the adoption of e-commerce within SMEs.

Technological factors consist of several indica-

tors, such as perceived beneﬁts, suitability, and costs

that affect e-commerce innovation adoption. The per-

ceived advantage is the level of acknowledgment of

beneﬁts to be obtained for the company (Oliveira

and Martins, 2011). Direct perceived beneﬁts as

discussed in the section earlier and expectation of

indirect beneﬁts (customer service, productivity in-

crease), also inﬂuence the degree to which organiza-

tions receive e-commerce advances (Crook and Ku-

mar, 1998) (Premkumar and Roberts, 1999).

(Alamro and Tarawneh, 2011) states that per-

ceived beneﬁts refer to the acquisition or improve-

ment of existing business operational transaction

methods with e-commerce applications, including in-

creased proﬁt and the creation of positive relation-

ships of trade partners, satisfaction and commitment

between partners. (Kowtha and Choon, 2001) (Zhu

Vital Strengthening of SMES through E-Commerce Adoption Purposeful

161

et al., 2003) (Hong and Zhu, 2006) contend it is vital

to understand the supporting and hindering compo-

nents of companies in receiving e-business.

Some researchers identify technology as a cru-

cial factor and the key to achieving successful adop-

tion of information systems, (Kuan and Chau, 2001)

(Kowtha and Choon, 2001) (Delone and McLean,

2003) (Nelson and Shaw, 2003) (Hong and Zhu,

2006) report a positive relationship between enter-

prise technology infrastructure and e-business diffu-

sion. Learning variables such as mastery in special-

ized and innovative management have a noteworthy

effect on advancement adoption (Kindstr

om et al.,

2013) (Wang and Cheung, 2004)

Expansive companies are individuals who gener-

ally receive innovation since they have more assets

(Crook and Kumar, 1998) (Kowtha and Choon, 2001)

(Thong, 2001)(Hwang et al., 2004). Organizational

readiness using the business dimension and size of

the company’s business as a dimension of organiza-

tional aspects and was elaborated with indicators of

organizational readiness, among others: the range of

markets served, the reach of distribution channels, the

ability of alliances with suppliers, customer relations

(Zhu et al., 2002). Organizational readiness is a mea-

surement of whether the company’s attributes are suf-

ﬁcient to adopt e-commerce (Chong et al., 2012).

Indicators of the company’s external environment

that can inﬂuence the company’s intention in the

ebusiness adoption processincluding customer readi-

ness, business partner readiness and the level of indus-

trial competition (Zhu et al., 2002) (Gibbs and Krae-

mer, 2004). The concentrated of ICT exercises within

the industry in which the company works, alluding

to the degree to which corporate accomplices, clients,

and providers embrace innovation in their commerce

operations and processes (Simatupang and Sridha-

ran, 2002) (Ranganathan et al., 2004). The impacts

of government approaches appear to coordinate and

backhanded incitement of data stream that empowers

quicker spread of innovation (Bagale, 2014). Govern-

ment e-readiness as an evaluation of the organization

of the planning of a nation and its commitment to en-

ergize, bolster, encourage, and organize e-commerce

and its needs (Molla and Licker, 2005).

CEOs can inﬂuence IT adoption based on inno-

vation and their interest in change. Because of the

CEO’s overwhelming part in small businesses, this

perspective is exceptionally imperative in executing

IT. The willingness of CEOs to innovate mainly deter-

mines IT adoption (Thong, 1999) (Zhu et al., 2003).

The CEO’s part as a item winner is discussed in

(Grover, 1993). In small businesses, the CEO is or-

dinarily the sole proprietor and decision producer and

advancement and CEO inclusion contribute to the vic-

tory of the IT appropriation process (Poon and Swat-

man, 1999). Inventive CEOs are willing to require

risks and incline toward arrangements that have not

been attempted before (Thong, 2001). Directors with

a positive state of mind towards e-business as a instru-

ment that gives companies with key esteem can rein-

force the inclination to embrace e-business in compa-

nies (Grandon and Mykytyn Jr, 2004). The challenges

of e-commerce as individuals and organizational is-

sues, counting getting senior administration bolster

(Kuzic et al., 2002).

3 MATERIALS AND METHODS

A descriptive-associative approach was connected in

this study where the survey was created to test the

hypothetical system and theories created. The pop-

ulation of the ponder was SMEs producing snacks,

such as roasted peanuts, banana chips, cassava chips,

crackers, and so on in Keranggan, Setu, Tangerang

Selatan. This study collected data in cross sectional

range of time, from in depth interviews and a ques-

tionnaire. The basis for embracing this approach is

that a study conducted through the utilize of a planned

survey can donate a list of questions to respondents in

arrange to get reactions. Upon extraction, it is ad-

ditionally easier for elucidation because it includes

standard collected information subjected to thorough

quantitative examination (Sekaran, 2003). Probabil-

ity sampling with simple random sampling was uti-

lized to choose the respondents. With a total num-

ber of 150 populations, this study targeted 100 SMEs

respondents in Keranggan Village, Setu, Tangerang

Selatan. This study employed Structural Equation

Modeling (SEM) with SmartPLS Software 3.0 for

data analysis. Partial least squares (PLS) analysis is

an alternative to OLS regression, canonical correla-

tion, or covariance-based structural equation model-

ing (SEM) of systems of independent and response

variables. Structural Equation Modeling (SEM) is a

second-generation multivariate data analysis method

that is often used in marketing research because it can

test theoretically supported linear and additive causal

models.

4 RESULTS AND DISCUSSIONS

4.1 Structural Model Analysis

The Technological aspect (X1) consists of 3 dimen-

sions: Relative Advantage, Compatibility, and Cost.

ICASESS 2019 - International Conference on Applied Science, Engineering and Social Science

162

Organizational aspect (X2) consists of 3 dimensions:

Firm Size, Organizational Readiness, and Information

Intensity. Environmental aspect (X3) consists of 4 di-

mensions: Industry Pressure, Government Pressure,

Consumer Readiness, and Support from Technology

Vendors. Individual Aspects (X4) consist of two di-

mensions: CEO’s Innovativeness and CEO’s Involve-

ment. Ecommerce Adoption Intention (Y) in this pon-

der measures the degree to which the crave of SMEs

to implement online sales, online ordering raw ma-

terials to suppliers, aggressively conducting advertis-

ing via the internet, and applying technology to ex-

change information.The number of p-values in each

dimension shows a value of P ¡0.05, where fulﬁlling

the minimum requirements must be less than 0.05.

From these results it can be concluded that Relative

advantage, Compatibility, Cost, Firm size, Organi-

zational readiness, Information intensity and product

characteristics, Industry pressure, Government pres-

sure, Consumer readiness, Support from technology

vendors, CEO innovativeness, and CEOs involvement

includes a noteworthy impact on Adoption Intention

Ecommerce. Table 1 describes Cronbach’s Alpha,

Composite Reliability, Average Variance Extracted

(AVE), Original Sample (O), P Values, f-squared ef-

fect size of the full SEM model.

Table 1: Cronbach’s Alpha, Composite Reliability, Average

Variance Extracted (AVE), Original Sample (O), P Values,

f-squared effect size.

Cro

nba

ch’s

Al-

pha

Com

pos

ite

Re-

lia-

bil-

ity

Aver

age

Vari-

ance

Ex-

tra

cted

VE)

Orig

inal

Sam-

ple

(O)

Val-

ues

squ

are

ef-

fect

size

Relative

advan-

tage

0.86

0.89

0.51

0.39

0.01

0.04

Compatibi

lity

0.67

0.73

0.58

0.12

0.03

0.01

Cost 0.60

0.71

0.58

0.11

0.04

0.00

Firm

size

0.77

0.78

0.54

0.16

0.04

0.00

Organizati

onal

readi-

ness

0.84

0.87

0.50

0.19

0.03

0.01

Information

inten-

sity

and

prod-

uct

char-

acter-

istics

0.65

0.85

0.74

0.15

0.02

0.01

Industry

pres-

sure

0.73

0.8

280

0.54

0.15

0.02

Governm

ent

pres-

sure

0.66

0.82

0.69

0.14

0.02

0.03

Consumer

readi-

ness

0.68

0.80190.50

0.29

0.01

0.02

Support

from

tech-

nology

ven-

dors

0.64

0.83

0.71

0.16

0.04

0.00

Vital Strengthening of SMES through E-Commerce Adoption Purposeful

163

CEOs

inno-

vative-

ness

0.65

0.72

0.57

0.13

0.04

0.00

CEOs

in-

volve-

ment

0.66

0.72

0.54

0.15

0.04

0.00

Figure 2. describes the full SEM model as the re-

sults of the research showing the parameter values of

each observed variable (indicator) and exogenous la-

tent variables and endogenous latent variables.

Technological (X1), Organizational (X2), Envi-

ronmental (X3), and Individual (X4) aspects have a

positive and noteworthy impact on Ecommerce Adop-

tion Intention (Y). Technological (X1), Organiza-

tional (X2), Environmental (X3), and Individual (X4)

aspects have a determinant coefﬁcient of 0.8807 on

E-commerce Adoption Intention (Y), meaning that

E-commerce Adoption Intention (Y) variables can

be explained by Technological (X1), Organizational

(X2), Environmental (X3), and Individual (X4) aspect

variables are 88.07%, the rest are explained by other

factors.

Figure 2: SEM Model.

Relative Advantage has the most elevated impact

on e-commerce appropriation eagerly in Technolog-

ical angles. Respondents considered ecommerce ap-

propriation would increment deals and beneﬁts. The

higher the entrepreneur’s understanding of the relative

beneﬁts of e-commerce selection, the more notewor-

thy the probability of companies distributing assets

such as administrative assets, monetary assets, and in-

novative assets, to embracing e-commerce innovation

(Ghobakhloo et al., 2011).

The comes about of this study approve past stud-

ies which found that relative beneﬁts are critical

forecasters for E-commerce execution (MacGregor

and Vrazalic, 2008) (Alamro and Tarawneh, 2011)

(Wanyoike et al., 2012). This study watches that

CEOs who execute e-commerce selection altogether

accept that e-commerce is not only able to extend

deals, but moreover extend advertise share, decrease

costs, and exploit new trade prospects.

The results of the study show that Cost has the

lowest inﬂuence on the intention of e-commerce

adoption in the Technological aspects. Based on the

results of interviews with SME business people in

Keranggan Village, SME organizations have limited

capital so their ability to buy information technology

equipment is also limited. In addition, several SMEs

have doubts about investing in using the technology

and the limited human resources to apply it. Each in-

dicator has a different inﬂuence. The biggest indicator

values in each dimension are shown in Table 2.

Table 2: Calculation Results Loading Factor.

Indikator Outer

Load-

ings

Aspek Technological (X1)

Relative Advantage - RA4 In-

crease sales and prof-

its.

0.7966

Compatibility-

CTB2

Knowledge of em-

ployees in using the

technologies they

have.

0.7889

Cost - C2 Financial resources

are important as

funds are available

for installation,

promotion, purchas-

ing, shipping, and

sustainability costs

during the use of

e-commerce.

0.6753

Aspek Organizational (X2)

Firm Size -

FZ2

The size of the

company makes it

possible to adopt

e-commerce technol-

ogy.

0.6922

Organizational

Readiness-

OR1

The market reach

served by the busi-

ness scope is increas-

ingly widespread.

0.8313

ICASESS 2019 - International Conference on Applied Science, Engineering and Social Science

164

Information

Intensity-

INF2

The extent to which

information related

to a particular prod-

uct or service will

be reﬂected in the

intensity of customer

information.

0.8723

Aspek Environmental (X3)

Industry

Pressure-

IP3

Encouragement

to increase work

effectiveness.

0.7830

Government

Pressure-

GP1

The role of the

government in

facilitating the devel-

opment of regional

infrastructure to

improve service and

management of re-

gional infrastructure.

0.8379

Consumer

Readiness-

CR1

Consumer’s positive

perception of online

shopping.

0.7469

Support

from Tech-

nology

Vendors -

STV2

Partner capabilities

in investments that

support compatible

systems.

0.7435

Aspek Individual (X4)

CEO’s

Innovativeness-

INOV1

The desire of busi-

ness owners to obtain

relevant information

and skills faster than

others in a social

context.

0.8151

CEO’s

Involvement-

IVL2

Full involvement of

business owners in

implementing the

new system.

0.6473

E-commerce Adoption In-

tention (Y)

EAI1 Implement online

sales

0.8140

Information Intensity concurring to the respon-

dent’s appraisal will contribute to the victory of the

organizational perspectives of e-commerce selection

in case the information related to a speciﬁc item or

beneﬁt is reﬂected within the escalated of customer

information. Information about SME items has to

be expanded so that customers know the items sold

by SMEs. So, e-commerce is very effective in the

sense that consumers get information about the prod-

ucts they need and transact in a fast and inexpensive

way. Physically safe, consumers do not need to go

to the store where the company sells goods and this

allows consumers to transact safely, because in cer-

tain areas it may be very dangerous to drive and carry

large amounts of cash. Flexible, consumers can make

transactions from various locations, both from home,

ofﬁce, internet cafe, or other places. Consumers also

don’t need to dress neatly. But often it causes dis-

appointment. What is seen on a computer monitor

screen is sometimes different from what is seen by

naked eye.

Though Firm Size, which is the estimate of the

company permits planning the assets required, has

the least impact on the deliberate of e-commerce ap-

propriation within the Organizational aspect. The

fetched of interfacing to the web, satisfactory hard-

ware/software costs, setup, and maintenance costs

may be troublesome for a few SMEs since the start-

ing speculation for the selection of unused innova-

tion is relatively heavier for smaller companies than

expansive companies. Financial availability affects

the level of e-commerce adoption, these ﬁnancial re-

sources are important as funds are available for instal-

lation, promotion, purchase, delivery, and sustainabil-

ity costs during the use of e-commerce (Nelson and

Shaw, 2003). Expansive companies frequently have

adequate trade, human and innovative assets to con-

tribute to e-commerce. The size of the company in

question is a small business size. The business that

adopts ecommerce is the majority of small businesses

because micro or small businesses must ﬁnd ways to

survive in an easy way and not cost a lot. The way

that can be used in promoting it simply and easily is

by adopting e-commerce (Savrul et al., 2014).

Government Pressure with the government’s role

in facilitating the development of regional infrastruc-

ture to improve service and management of regional

infrastructure contributed to the success of environ-

mental aspects in encouraging e-commerce adoption.

The South Tangerang City Government was asked

to help promote the Keranggan Village, KecSetan,

Tangsel as a tourist village for micro and small-scale

industries. Promotion is very much needed so that the

area will increasingly develop into a micro and small-

scale industrial center because so far it has been pop-

ular as a home industry center that produces snacks.

In expansion to instructive assistance, facilitation of

innovative framework and lawful systems, the cli-

mate that will energize commercial application engi-

neers to supply item highlights that bolster different

e-commerce advances that will contribute to the ac-

complishment of SMEs. To create an environment

that supports ecommerce, the government can help

solve problems, increase awareness, and provide the

right infrastructure, marketing local content accord-

ing to language and culture in the local environment

Vital Strengthening of SMES through E-Commerce Adoption Purposeful

165

(Mirchandani and Motwani, 2001).

The appropriation of e-commerce requires gov-

ernment bolster within the frame of arrangements

that bolster e-commerce development issued, it is

not clear whether control of information technology

frameworks, particularly the web, is one of the spines

of e-commerce advancement, change of the customs

framework and deregulation of export-import prod-

ucts. Infrastructure development is slow. One of the

main obstacles is still the lack of infrastructure that

exists and has not been evenly distributed through-

out the Indonesian archipelago. Government’s seri-

ousness is needed to gradually build good and pro-

grammed infrastructure, Indonesian people can be in-

troduced to the internet as one of the results of devel-

oping information technology at a cheap and afford-

able cost.

Adoption of e-commerce requires readiness of hu-

man resources both technically and nontechnically

such as the banking system, trade trafﬁc to the ap-

plicable legal system. There is a need for the acces-

sibility of information and education centers for the

advancement of e-commerce specialists. The adop-

tion of e-commerce moreover requires bank and pro-

tections support, a great ’electronic banking’ frame-

work is required, other than that Indonesian banks

are also still troublesome to form exchanges utilizing

other monetary forms, particularly in small sums and

the nonattendance of third parties as online exchange

underwriter truly in Indonesia.

Consumer readiness, which is the comfort of cus-

tomers for internet access, has the least impact on the

deliberate of e-commerce appropriation within the en-

vironmental perspectives. The emergence of fraud

through e-business and there are no guarantees for

transactions carried out, thereby reducing the level of

customer trust. With the emergence of various cases

that occur, a solution is needed to increase customer

trust to make transactions through online marketing.

The e-marketplace model allows shared accounts and

guarantees from third parties for successful trans-

actions. Concerns about fraud and non-delivery of

goods from consumers will be eliminated. Whereas

from the merchant’s side, the trust will be paid for the

items sent will be higher due to account facilities.

This implies that CEO’s Innovativeness concur-

ring to respondents’ judgment will decide the per-

sonal viewpoints of e-commerce appropriation on the

off chance that there is a desire of commerce propri-

etors to get important information and abilities faster

than others in social settings. CEOs can impact IT ap-

propriation based on advancement and their intrigued

in alter. Since the CEO’s prevailing part in little busi-

nesses, this perspective is exceptionally vital in exe-

cuting IT. The readiness of CEOs to improve basically

decides IT appropriation (Thong and Yap, 1995). Past

writing found CEO innovativeness to signiﬁcantly

and positively impact IT adoption (Thong, 1999)

(Mirchandani and Motwani, 2001)(Thong, 2001).

In small businesses, the CEO is ordinarily the sole

proprietor and choice creator and advancement and

CEO association contribute to the victory of the IT

appropriation process (Poon and Swatman, 1999). In-

novative CEOs are willing to require dangers and fa-

vor arrangements that have not been attempted before

(Thong, 1999). The development of information tech-

nology can be used to help market products to con-

sumers. There are several main capabilities of in-

formation technology, namely (Turban et al., 2006):

a. Perform fast numeric computing, and large vol-

ume capacity; b. Deliver communication that is quick,

precise, and reasonable inside and between organiza-

tions; c. Large storage capacity in media that is in-

creasingly small and easily accessible; d. Increasing

the effectiveness of team/group performance that is

spread/different locations; e. Enables access to lots

of information quickly and cheaply, globally; f. Au-

tomation of business processes; g. Typing and edit-

ing speed; h. The above capabilities are carried out

cheaply compared to manual methods.

CEO’s Involvement, to be speciﬁc commerce pro-

prietors, have encounter and capabilities related to

information technology having the littlest parameter

gauges. A CEO with more IT information can eval-

uate the beneﬁts of unused innovation and be more

likely to embrace development. Lack of IT infor-

mation makes instability and as it were mindfulness

through the information that gives certainty to un-

used developments that encourage adoption (Thong,

2001). CEOs in small organizations need essential

information on IT and have lacking mindfulness of

the potential beneﬁts of IT adoption (Gable and Ra-

man, 1992). CEOs without IT knowledge tend not to

be committed to IT appropriation assets. In connec-

tion to small businesses, Mirchandani and Motwani,

2001 show that beat administration bolster is a criti-

cal calculate in recognizing adopters and not adopters

of ecommerce.

5 CONCLUSIONS

The discoveries of this study contribute to the body

of writing in a number of ways. This study gives

an understanding of the appropriation of e-commerce

by SMEs. Innovation encompasses a noteworthy im-

pact on e-commerce selection eagerly. Organizations

have a signiﬁcant impact on ecommerce appropriation

ICASESS 2019 - International Conference on Applied Science, Engineering and Social Science

166

eagerly. Environment includes a signiﬁcant impact

on e-commerce selection eagerly. Individual con-

tains a signiﬁcant impact on e-commerce selection

eagerly. Innovation, organization, environment, and

people at the same time have a signiﬁcant impact on

e-commerce selection eagerly.

The government must increment its endeavors by

advancing viable programs and activities to empower

the level of e-commerce appropriation bySMEs. Pro-

prietors and supervisors of SMEs have an important

part in empowering the development of advancement

since they are recognizable with the organizational

framework and the characteristics of SMEs. Man-

agers must realize that they can have a positive im-

pact on the appropriation of technology by preparing

their representatives, conjointly believe technologies

focal points. SMEs actors need to develop creative

and innovative elements so that their business have

better performance. It is vital for SMEs to extend

representative information in utilizing the innovation

they have in arrange to grow the run of markets served

and be able to outlive within the period of world-

wide competition. SMEs have an important role in

global economic and it is the reason why government

policy needs to improve human and technology ca-

pability, give information about market opportunity,

improve internet accessibility, facilitate funding ac-

cess, and facilitate information system among SMEs.

This result might enhance the understanding of SME

proprietors with respect to the potential beneﬁts of e-

commerce. A more prominent understanding of the

issue will increment their likelihood to apportion a

few assets towards receiving e-commerce. SMEs got

to plan the assets such as innovation and organization

in ecommerce appropriation by considering Techno-

logical, Organizational, Environmental, and Individ-

ual components.

ACKNOWLEDGEMENTS

This research was bolstered by Binus University. We

thank our colleagues from School of Business Man-

agement who given bits of knowledge and skill that

signiﬁcantly helped the research. We thank Prof.

Tirta Nugraha Mursitama, S.Sos, M.M, Ph.D. and

Prof. Bahtiar Saleh Abbas, Ph.D for the help with

SEM procedure, strategy, and Bachtiar H. Simamora,

MSc, Ph.D, as well as Dr. Rinda Hedwig S.Kom,

M.T., Leader of RIG, Bina Nusantara University

for her comments that enormously made strides the

manuscript. We would moreover like to send our

appreciation to Dr. Engkos Achmad Kuncoro, SE.,

M.M, Director of SoBM, Bina Nusantara College for

sharing their pearls of shrewdness with us amid the

course of this research.

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