Strategic implications of E-business adoption by family owned Maltese manufacturing SMEs : an exploratory analysis
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The importance of SMEs in national and global economies is increasingly becoming of interest in academic and political scenarios, especially when it comes to innovation and creativity of business strategies that SMEs are known for. However, comparatively little can be found on how the strategic implications of family-owned manufacturing SMEs affected the competitive strategy of their firm when it came to adopt e-business technology. Malta has a micro-economy, with a manufacturing sector that strived to provide an ambience that stimulated growth and the need to use e-business technologies. This study aims to map the strategic implications of family-owned manufacturing SMEs by exploring their readiness that motivated or inhibited the adoption of e-business in this small island state. The owners/managers of 20 family-owned businesses that fell in line with the EU’s definition of SMEs were examined within the Maltese industrial manufacturing context. It was concluded that for a research study of this type, Rogers’s (1995) diffusion of innovation theory (DOI) and Tornatzsky and Fleischer’s (1990) technology, organisational and environment theory (TOE) were stronger when combined. Critical analyses of contemporary theories related to e-business adoption revealed how one individual theory on its own could not adequately explain the readiness of family-owned SMEs that were gearing or considering in investing in e-business. The readiness of the owners/managers that were considered as the main decision makers and sole representatives of the firms, were explored by a combined DOI and TOE assessment. The combination of the DOI and TOE assessed the readiness and their likely levels of investing in this technology. The rationale for the adoption of the DOI and TOE theories in combination, along with a critique and an argument on the non-use of four other theories in this field of study was substantiated. Hence, to consider this issue and address the relevant gaps, the combination of the two theoretical frameworks Rogers’s (1995) DOI and Tornatzsky and Fleischer’s (1990) TOE were applied to assess major/minor motivators or inhibitors that could be have been an impediment to the readiness of the firm. Before the main study interviews, a pilot study of the two SME firms was conducted. Subsequently, a thematic grid analysis of the conducted interviews was designed prior the main study’s interviews with the 20 SMEs, that were examined in a separate modified analysis grid. The findings from this study created an understanding of what were the motivational and inhibitor influences that affected the readiness when it came to adopt e-business and their likeleness levels to invest in e-business as a strategy. In terms of academic and practitioner contributions, this study has extended on seminal and contemporary studies conducted around the world that were a source of a greater potential in expanding on the existing understanding of what are the dimensions and elements that made Maltese family SME owner/managers ready to adopt e-business. The findings of this study contributed towards the SMEs in general that were planning to adopt e-business as part of their modus operandi by applying their strategies based on the findings from this research. From the theoretical point of view, the findings of this study were consistent with both theories used in seminal and contemporary literature. The empirical evidence of this study contributed to the body of knowledge in e-business adoption by SMEs in general. Therefore, this study can be considered as a theoretical and practitioner contributor by supporting both the TOE and DOI theories.