Research Article Open Access

Factors Influencing Electronic Business Technologies Adoption and Use by Small and Medium Scale Enterprises (SMES) in a Nigerian Municipality

Abstract

This study examined the adoption of e-business technologies by SMEs in Ibadan a metropolitan city in South West Nigeria. It aimed at finding out the factors that promote and inhibit the adoption of e-business technologies, the kinds of e-business technologies adopted and used and their extent of use. It also identified the challenges faced by SMEs with regard to e-business technologies use. Descriptive survey research design was adopted. Data were collected with structured questionnaires administered among sixty SMEs (30 adopters and 30 non-adopters). Four hypotheses were tested at 0.05 level of significance. Data were analyzed using frequency and percentage distributions, t-test and multiple regression. Results showed that majority of the firms were smaller firms with 0-9 employees and not less than 1-5 years of establishment. The respondents cited perceived benefits as the major factor for adopting e-business technologies in their firms while 83.4% of non-adopters agreed that low capital base was the major reason inhibiting them from adoption. Hundred percent of the firms each have adopted internet technology and electronic mail which are daily used by all the firms. The major service provided with the use of these technologies was e-mail to communicate with customers and suppliers. On the benefit and challenges of e-business, all the organizations affirmed that e-business have benefited them in the sharing and exchange of information and improving market share. About 96.7% of them affirmed inadequate technical manpower as the major challenge. Further results revealed that the age of the SMEs had significant relationship on the adoption of e-business while size had no significant relationship. Independent variables jointly correlated significantly with the adoption of electronic business (R=0.162) and they contributed (22%) to the variance of the dependent variables. Their significant contributions were as follows: perceived benefit (β=0.568, p<0.05), nature of organization’s business (β=0.533, p<0.05); owner’s awareness of the technology (β=-0.577, p<0.05); and (β=0.725, p<0.05) while other variables were not significant. The results clearly indicate the necessity to provide support to SMEs to enable them to successfully adopt and use e-business technologies. The results have implications not only for managers of SMEs but also for government bodies in developing countries such as Nigeria.

Wole Olatokun, Busola Bankole

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