Barriers to the adoption of online supply chain solutions in small and medium enterprises

The objective of this paper is to identify and measure the perceived importance of barriers in the SME community to the adoption of internet business procurement and supply chain solutions. This was a telephone survey of a sample of 173 Canadian small and medium‐sized enterprises (SMEs), stratified by size of company (small and medium) and according to whether they were distributors, retailers or manufacturers. The data were analyzed statistically through an analysis of variance approach. Few differences were found between SME internet adopters and non‐adopters. There is a need for education for all SME management on the benefits and drawbacks to using e‐business solutions. Inter‐organizational information systems that are required to link supply chain partners can be a serious barrier to online solutions. There is a significant dependency among supply chain partners in decisions on adopting online links. Flexibility, agility and ability of SMEs can help them to use partial e‐business solutions for low volumes of business, but this approach can be very ineffective when transaction volumes are large. The results from this paper can help to direct future efforts to encourage SMEs to adopt e‐business solutions. This study differs from other SME e‐business adoption studies, in that it includes relationships with supply chain partners that play a large role in the adoption of innovative e‐business solutions, transaction volumes which, for many SMEs that have not adopted e‐business, may be too small to justify automated supply chain linkages, and transaction volumes with a company's biggest customer or supplier.