SME adoption of e-procurement in Hong Kong : the roles of power, trust and value

香港中小企接受網上採購的因素 : 權力, 信任與價值的角色

Student thesis: Master's Thesis

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  • Kwan Yee Joyce CHAN

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Awarding Institution
Award date2 Oct 2002


The SME (Small- to Medium-sized Enterprises) sector is of increasing significance for its contribution to the Hong Kong economy. Because electronic procurement (eprocurement) is an expensive business activity, SME competitiveness would be improved if they can enjoy the advantages from e-procurement adoption. Electronic procurement promises to reduce cost of procurement, lower error rate and provide better control over the process. Ultimately, their e-procurement adoption behaviour will benefit the local economy in terms of the wealth created and the number of labour employed. Therefore, it is important to study the determinants of e-procurement adoption by SME. Using e-procurement requires simultaneous actions of both the buyer and the seller. Cooperation of the two sides is decisive to the adoption or rejection behaviour. The proposed e-procurement adoption model therefore focuses on the dyadic buyer-seller relationship in direct procurement rather than on the characteristics of information technologies (IT). It argues that power (including power of suppliers and power of eprocurement), trust (including trust on suppliers and trust on IT), and value of eprocurement are factors leading to e-procurement adoption behaviour. The model was tested using multiple case study approach in order to gain a rich and detailed understanding of the phenomenon. The four firms interviewed were e-procurement adopters. They were either manufacturing firm or trading company. This study contributes to a better understanding of e-procurement adoption behaviour of local SME using a snapshot approach. Several conclusions are drawn from the research findings. First of all, value of e-procurement adoption is the most important determinant of e-procurement adoption. Trust is playing a role occasionally while power seems to have no effect at all. Second, many SME are still at the beginner's level of e-procurement adoption. They are waiting for the existence of critical mass of e-procurement adopter. Further, it is found that Internet security is the number one concern of local SME. This explains their hesitation to adopt e-procurement. If the risk of doing transactions online is lowered to an acceptable level, they are likely to carry out more sophisticated e-procurement. Lastly, the findings suggest the roles of the stakeholders in encouraging further electronic procurement adoption by SME.

    Research areas

  • Hong Kong, Electronic commerce, China, Data processing, Small business, Industrial procurement