Factors affecting e-commerce adoption in the electronic manufacturing companies in Malaysia

Syed Shah Alam

Faculty of Business Management, MARA University of Technology, Shah Alam, Selangor, Malaysia

Factors affecting e-commerce adoption 125

Ali Khatibi
Graduate Management Centre, University College of Technology & Management, Shah Alam, Selangor, Malaysia

Mohd. Ismail Sayyed Ahmad

Faculty of Economics and Management Sciences, International Islamic University, Gombak, Selangor, Malaysia, and

Hishamuddin Bin Ismail

Faculty of Business and Law, Multimedia University, Melaka, Malaysia
Abstract
Purpose This paper sets out to examine the factors inuencing internet-based e-commerce in the electronic manufacturing companies in Malaysia. Design/methodology/approach The sample data are derived from a questionnaire survey of 194 companies selected from the Federation of Malaysian Manufacturer lists to investigate the study hypotheses. Rogers ve innovation diffusion characteristics were considered as factors that affect EC adoption and security/condentiality was taken as an additional factor for this study. Findings The multiple regression analysis results indicate that relative advantage, compatibility, complexity, observability and security appear signicant. Relative advantage and compatibility have positive and signicant inuence on EC adoption whereas complexity and security have negative effects. This study also revealed a non-signicant relationship between trialability and e-commerce adoption. Research limitations/implications The results are limited within the sample of electronic manufacturing companies in Malaysia, so the results cannot be generalized. Originality/value This study provides a greater understanding of managers perception of e-commerce adoption in their manufacturing companies. Those interested in promoting their business online may nd these results helpful in guiding their efforts. Keywords Electronics industry, Electronic commerce, Internet, Malaysia Paper type Research paper

1. Introduction The use of internet-based electronic commerce (EC) by business enterprises around the world is now a way of doing business (Chong et al., 2001). The internet is not just another medium or a distribution channel to reach the customers, but it is an important

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medium to nd new customers as well as a medium to continue relationships with existing customers (Limthongchai and Speece, 2003). In the world, it is impossible for business and consumers to ignore the new technology (Chong et al., 2001). Todays EC networks links nations, people and organization of all sizes (Gunasekaran and Ngai, 2005). Given the competitive impact of this technology, EC has been the subject of a number of recent research investigations. These research investigations have reported that when deployed by organizations, EC can serve to: . enhance customer service; . facilitate the management of value chain activities; . improve inventory control; . increase market reach; and . reduce both marketing and distribution costs (Senn, 2000; Riggins and Rhee, 1998; Shi and Salesky, 1994; Zinelding et al., 1997; Turban et al., 2000; Rayport and Jaworski, 2001). They argue that EC will redene the relationship between customers and suppliers of goods and services. It will provide opportunities afforded by the internet which include: a new and lower-cost channel to market; clicks and mortar synergies; scope for hypermediation; better knowledge of consumer preferences; and scope for diversication of products and services. Malaysia has shifted her agriculture-based economy to industry-based in order to stand the challenge of the twenty-rst century. The latest industrial initiative taken by the Malaysian Government after 1997 was to encourage rms to be more knowledge-intensive rather than production-intensive in order to transform Malaysia into a knowledge-economy (k-economy). Despite the emergence of these competitive advantages, some countries have been slow to adopt EC technologies. This has been particularly true of Malaysia (Santos and Peffers, 1998). Given this situation, the Malaysian Government has sought to implement an industrial initiative which promotes the introduction and use of EC technologies. The purpose of this paper is to monitor the diffusion of these technologies by attempting to identify characteristics which predict the rate of EC adoption by electronic manufacturing companies in Malaysia. Since the majority of research on EC adoption has been undertaken in the developed countries based on the Rogers model, the extent to which research ndings in these countries can be applied to the Malaysian context should be tested. Therefore, the purpose of this study was to identify the perceived characteristics of innovation that best predict the rate of EC adoption by electronic manufacturing companies in Malaysia. 2. Theoretical framework 2.1 Research model Technology adoption and diffusion has been the topic of many studies (Rogers, 1995; Tornatzky and Klein, 1982; Bajaj and Nidumolu, 1998; Igbaria et al., 1997). In communication literature, diffusion is dened as the process by which an innovation is communicated through certain channels over time among members of a social system (Rogers, 1995, p. 171). The diffusion of innovation theory stresses the

role of social networks among potential adopters. It seeks to describe, explain and predict the adoption behaviour of a specic group. Rogers (1995) innovation diffusion theory is widely used as a theoretical framework for analyzing the adoption of technological innovations. Rogers has identied several factors which serve to inuence the adoption rate of innovations by organizations. These factors are: (1) relative advantage; (2) compatibility; (3) complexity; (4) trialability; and (5) observability (Gatignon and Robertson, 1985). Relative advantage is dened as the degree to which an innovation is perceived as being better than the idea it supersedes. Compatibility is dened as the degree to which an innovation is perceived as consistent with the existing values, past experiences, and needs of potential adopters. Complexity is dened as the degree to which an innovation is perceived as relatively difcult to understand and use. Trialability is dened as the degree to which an innovation may be experimented with on a limited basis. Observability is dened as the degree to which the results of an innovation are visible to others. 2.2 Research question and hypotheses of this study Based on Rogers innovation diffusion theory, there are ve characteristics of innovation that will lead organization to higher rate of EC adoption. Therefore, based on the conceptual foundation provided by Rogers (1983) and from previous research, the main research question of the study is: RQ1. What are the perceived characteristics of Innovation that best predict the rate of EC adoption by the electronic manufacturing companies in Malaysia? To understand the adoption of e-commerce by the electronic manufacturing companies in Malaysia as an adoption of technological innovation, a research model was constructed using these ve perceived characteristics of innovation by Rogers relative advantage, compatibility, complexity, trialability and observability to explain adoption of e-commerce. An additional characteristic security/condentiality is proposed for the e-commerce context. It is found that; security/privacy is the major inhibitor of EC adoption (Bauman et al., 1996; Wheeler, 1997). 2.2.1 Relative advantage. Relative advantage is viewed as an advantage for an organization over previous ways of performing the same task (Agarwal and Prasad, 1997). Relative advantage has been found to be one of the best predictors and positively related to an innovations rate of adoption (Premkumar et al., 1994; Rogers, 1995; Tan and Teo, 2000). In view of the advantages that EC offer, it would thus be expected that companies who perceived EC as advantageous would also be likely to adopt the EC. This leads to the H1: H10 . There is no relationship between e-commerce adoption and perceived relative advantage in the Malaysian electronic manufacturing companies.

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H1. The adoption of e-commerce by Malaysian electronic manufacturing companies is positively related to the perceived relative advantage of using e-commerce. 2.2.2 Compatibility. Tonatzky and Klein (1982) found that an innovation is more likely to be adopted when it is compatible with individuals job responsibility and value system. It will likely be adopted not only if it is compatible with deeply held cultural values but also if it is compatible with previous ideas. Compatibility of and innovation with a preceding ideas can either speed up or retard it rate of adoption in the organization. The degree to which innovation meets client needs is another dimension of compatibility of an innovation. Organization should seek to determine the needs of their customers. Then, recommend innovations that full these needs. When felt needs is met, a faster rate of adoption usually occurs (Rogers, 1995). Therefore, it is expected that the companies use EC in their business purposes. They perceived the EC as compatible with the companies total business procedures, and that the companies will adopt EC. Thus, the hypothesis is: H20 . The adoption of e-commerce by Malaysian electronic manufacturing companies is not related to the perceived compatibility of using e-commerce. H2. The adoption of e-commerce by Malaysian electronic manufacturing companies will be positively related to the perceived compatibility of using e-commerce. 2.2.3 Complexity. Previous research has indicated that the adoption of complex innovations requires organizational personnel to possess sufcient operational resources and technical competencies (Cooper and Zmud, 1990). These resources include adequate computer or IT infrastructure, technical skills among organizational personnel, and training systems which facilitate the installation and maintenance of EC technologies (Chong, 2004; Scupola, 2001). This leads to the hypothesis: H30 . The adoption of e-commerce by Malaysian electronic manufacturing companies is not related to the perceived complexity of using e-commerce. H3. The adoption of e-commerce by Malaysian electronic manufacturing companies will be negatively related to the perceived complexity of using e-commerce. 2.2.4 Trialability. It becomes an important feature for an innovation because it provides a means for perspective adopters to reduce their uncertainties regarding unfamiliar technologies or products (Weiss and Dale, 1998). Rogers argues that when potential adopters have an opportunity to experiment with innovation prior to their adoption, they are both more comfortable with the innovation and more likely to recommend its adoption (Agarwal and Prasad, 1997; Tan and Teo, 2000). This leads to the H4: H40 . The adoption of e-commerce by Malaysian electronic manufacturing companies is not related to the perceived trialability of using e-commerce. H4. The adoption of e-commerce by Malaysian electronic manufacturing companies will be positively related to the perceived trialability of using e-commerce.

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2.2.5 Observability. The results of some of the innovations are easily observed and communicated with others whereas some innovations are difcult to describe to others. Observability is the degree to which the results of an innovation are visible to others. According to Rogers (1995), observability in an innovation is an important factor in early adoption of innovation. Manseld (1968) states that, the rate of reduction of the initial uncertainty regarding the innovations performance affects its rate of diffusion. This leads to the H5: H50 . The adoption of e-commerce by Malaysian electronic manufacturing companies is not related to the perceived observability of using e-commerce. H5. The adoption of e-commerce by Malaysian electronic manufacturing companies will be positively related to the perceived observability of using e-commerce. 2.2.6 Security/condentiality. Many surveys on e-commerce issues by Limthongchai and Speece (2003), Shi and Salesky (1994), Hoppe et al. (2001) and Kendall et al. (2001) have found that one of major barrier in developing e-commerce is the security of using e-commerce. To adopt e-commerce information safety it is essential for the company to have integrity of the entire system (Alam et al., 2004). A study conducted by Beale (1999) revealed that the reluctant among many consumers to embrace e-commerce, based mainly on concerns over security issues and lack of condence in the current set-up e-commerce. In addition, a survey of SME e-commerce in 1999, conducted by Price Waterhouse Coopers, showed that concern about security/privacy is perceived as the third most important barrier to the use of e-commerce by SMEs. The fear of losing trade secrets will create reluctance for SMEs to consider entering the e-commerce business arena (Killikanya, 2000). This leads to the H6: H60 . The adoption of e-commerce by Malaysian electronic manufacturing companies is not related to the perceived security/condentiality of using e-commerce. H6. The adoption of e-commerce by Malaysian electronic manufacturing companies will be negatively related to the perceived security/condentiality of using e-commerce. The use of internet-based EC by business enterprises around the world is now a way of doing business. The internet is not just another medium or a distribution channel to reach the customers, but it is an important medium to nd new customers as well as a medium to continue relationships with existing customers. In the world, it is impossible for business and consumers to ignore the new technology. 3. Research methods 3.1 Sample and data collection The study was conducted with companies that were randomly selected from the Federation of Malaysian Manufacturer (FMM), according to the following criteria: . the rms must be the electronics manufacturing companies; and . they must be located at Klang Valley and Penang state in Malaysia.

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Overall, 194 companies in the FMM, 2000 list were identied and asked to participate in the survey using personal administered questionnaire. The respondents needed to ll out the questionnaire which was composed of three parts: e-commerce activities in the company, opinions on the use of e-commerce and demographic information. Data was collected from 194 electronic manufacturing rms in Klang Valley and Penang in Malaysia. Out of the 194 surveyed, 58.3 per cent were multinational companies. The remaining 30.4 per cent were local companies and joint venture 11.3 per cent, therefore indicating that Malaysian electronic rms are predominantly multinational companies. If is found that almost 65 per cent of the companies were SMIs (63.4 per cent). Respondents of the survey also can be grouped into years of internet experience. Results show that less than seven years internet users were the largest portion, of which 67.0 and 33 per cent were above seven years internet users. Table I presents a breakdown of companies according to the manufacturing experiences. A high percentage of those surveyed (71.6 per cent) have been producing electronic product more than seven years, while relatively few (28.4 per cent) for less than seven years. 3.2 Measures 3.2.1 Dependent variable. The purpose of this study is to investigate the factors that would likely to inuence the level of EC adoption. EC can mean many things as noted earlier, but we focus on companies willingness to adopt different stages of doing business over the internet, ranging from having a web page to conducting transactions. These stages were formulated based on the possible levels of EC discussed in previous studies (Kendall et al., 2001; European Commission, 1998). For the dependent variable measure, the following applications were identied: web page usage, selling of products, buying supplies, suppliers replenishment, entire supply function and purchase from vendors and business transactions through internet. To obtain adequate quantitative information on these factors, questions were designed to measure managers perception of the relative frequency of each EC application or tool using three point scales, i.e. 1 frequent use, 2 seldom use, 3 never use.
No. of respondents 130 64 59 113 22 55 139 123 71 Cumulative percentage 67.0 100.0 30.4 88.7 100.0 28.4 100.0 63.4 100.0

No. 1. 2.

Demographic variables Years of internet experience Less than seven year Seven years and above Types of companies Local companies Multinational companies Joint venture companies Years of manufacturing experience Less than seven years Above seven years Size of the companies (based on total employees) SMIs Large scale industries

Percentage 67.0 33.0 30.4 58.2 11.3 28.4 71.6 63.4 36.6

3. 4. Table I. Companys prole

In previous studies, the advantages of using three-point scales in other countries were discussed (Kaynak et al., 2005; Kaynak, 1978; Malhotra, 1986, 1988). 3.2.2 Independent variables. Each of the perceived characteristics of innovation (Rogers, 1995) was measured on a ve-point Likert scale in which 1 indicated strongly disagree 2 indicated disagree 3 indicated neutral 4 indicated agree and 5 indicated strongly agree. The main reason for this choice is that diffusion theory was proposed by Rogers (1995) and has been widely employed for measuring innovation adoption (Limthongchai and Speece, 2003; Tan and Teo, 2000; Hoppe et al., 2001; Kendall et al., 2001). The Rogers ve determinants of EC, i.e. relative advantage, compatibility, complexity, trialability, observability and additional factor security/privacy were tested as independent variables. 3.3 Data analysis technique Bivariate frequency distribution of the respondents, according to types of companies, years manufacturing experience, size of the companies, and years of internet experience was presented. To study the factors, which signicantly affect EC adoption, multiple regression analysis is used. The analysis enabled us to examine the individual impact of the independent variables on EC adoption. Thus, Rogers innovation characteristics and another additional factor security were investigated. 3.4 Reliability and validity of data The internal reliability of the items were veried by computing the Cronbachs a and it suggested that a minimum a of 0.6 was sufced for early stage of research (Nunnally, 1978). The Cronbach a estimated for EC adoption scale was 0.8495, relative advantage scale was 0.7123, compatibility scale was 0.8539, complexity scale was 0.6702, trialability scale was 0.7783, observability scale was 0.7536 and security scale was 0.6139. As the Cronbachs a in this study were much higher than 0.6, the constructs were therefore deemed to have adequate reliability (Table II). 4. Results and discussion 4.1 Results of factor analysis Exploratory factor analysis was used in order to identify underlying constructs and investigate relationships among key survey interval-scaled questions regarding willingness to adopting EC in the companies. Principal axis factoring was carried out, followed by varimax rotation with Kaiser Normalisation. Varimax rotation facilitated interpretability. The Kaiser-Mayer Olkin measure of sampling adequacy was rst computed to determine the suitability of using factor analysis.
Variables EC adoption Relative advantage Compatibility Complexity Trialability Observability Security/condentiality Coefcient a 0.8495 0.7123 0.8539 0.6702 0.7783 0.7136 0.6139

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Table II. Reliability analysis

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A total of six factors with eigen values greater than 1.0 were identied. These factors explained 72.45 per cent of the total variance. Under the six conditions for EC adoption considered in this study, the combined results of factor analysis (Table III) shows that willingness to EC adoption relating to compatibility has got the rst priority with an eigen value 15.758 and 50.833 per cent of variations explain. Factor 2 (Table III) represents the weight of variables relating to relative advantage for the respondents EC adoption. Relative advantage with eigen value 5.692 had occupied the second position and explaining 18.368 per cent variations and exhibits loadings for all the six variables. Here relative advantage call for positive effect on EC

Conditions Relative advantage

Factor/variables Relatv1 Relatv2 Relatv3 Relatv4 Relatv5 Relatv6 Relatv7 Compati1 Compati2 Compati3 Compati4 Compati5 Complex1 Complex2 Complex3 Complex4 Complex5 Complex6 Trialabi1 Trialabi2 Trialabi3 Trialabi4 Trialabi5 Observa1 Observa2 Observa3 Observa4 Secur1 Secur2 Secur3 Secur4

Factor Factor Factor Factor Factor Factor 1 2 3 4 5 6 0.578 0.616 0.510 0.749 0.701 0.642 0.500 0.527 0.559 0.628 0.773 0.768 0.548 0.673 0.609 0.476 0.410 0.495 0.439 0.513 0.533 0.620 0.502 0.567 0.556 0.425 0.645 0.640 0.656 0.529 0.505 2.334 7.527

Compatibility

Complexity

Trialability

Observability

Security/condentiality

Table III. Factor analysis (varimax) showing the combined impacts on EC adoption

Initial eigen value Total variance explained percentage Extraction method: Principal axis factoring Rotation method: Varimax

15.758 50.833

5.692 18.368

3.503 11.301

1.861 6.006

1.848 5.964

adoption, as the variable EC will reduce the operating procedure (e.g. reduce the time to communicate across internal boundaries, reduce the time to access resources information) accounted highest loadings (0.749). These factors (Compat1 through Compat5) were found to load together with those that measured relative advantage (Relatv1 through Relatv7). A possible explanation for this could be that respondents who perceived EC on the internet as compatible with their values might tend to view them more favourably. Hence, they would be more likely to perceive EC as an advantageous innovation as well. All the items (Complx1 through Complx6) were found greater than the cut-off points of 0.4 for their respective construct. Hence, the complexity has got third preference with eigen value 3.503 in evaluating willingness to EC adoption and explaining 11.301 per cent of variations. Willingness to EC adoption relating to security with eigen value of 2.334 has contributed 7.527 per cent of total variations. In the combined factor analysis, observability has an eigen value of 1.861 and explaining 6.006 per cent variations of willingness of EC adoption and nally variables under the trialability have come under the Factor 6 (Table III) and shown an eigen value of 1.848. These factors explain 5.964 per cent of the total variance in the willingness to EC adoption of the respondents. For the further analysis all the factors were considered because the factor loading value were higher then the value of 0.4 considered in this study. 4.2 Normality of data and multi-collinearity This study involves a relatively large sample (194 companies) and therefore, the central limit theorem could be applied and hence there is no question on normality of the data. Two major methods were utilized in order to determine the presence of multi-collinearity among independent variables in this study. These methodologies involved calculation of both a tolerance test and variance ination factor (VIF) (Kleinbaum et al., 1988). The results of these analyzes are presented in Table IV. As can be seen from these data: . none of the tolerance levels is , or equal to 0.01; and . all VIF values are well below 10. Thus, the measures selected for assessing independent variables in this study do not reach levels indicate of multicollinearity. 4.3 Testing of hypotheses Table V presents results of a multiple regression analysis used to evaluate the strength of the proposed relationship. Six hypotheses were formulated and all the variables

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Variable Composite Composite Composite Composite Composite Composite relative advantage compatibility complexity trialability observability security/condentiality

Tolerance 0.138 0.216 0.318 0.442 0.441 0.447

VIF 7.255 4.626 3.148 2.265 2.267 2.238

Table IV. Test of collinearity

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retain after ltering with factor analysis. In order to test the six hypotheses, linear regression was used, regressing each of the independent variables towards the intention to adopt as the dependent variable. As seen in the table, the only hypothesis which is not supported is H4 (trialability). The ndings from regression analysis show that the intention to adopt EC can be predicted by the innovation diffusion characteristics proposed by Rogers (1995). The other hypotheses are supported including H1 (relative advantage), H2 (compatibility), H3 (complexity), H5 (observability) and H6 (security/condentiality). The overall results on the EC adoption section conrm Rogers (1995) theory regarding the inuence of innovation characteristics on EC adoption. The support of H1 (relative advantage) is in line with the results found by Hoppe et al. (2001). Multiple regression analysis shows relative advantage having (b 0.536; p-value 0.001) is the strongest predictor of EC adoption. It is expected since past literature has consistently shown that perceived relative advantage has a signicant and positive inuence on the adoption of new innovations (Tan and Teo, 2000; Holak and Lehman, 1990; Tornatzky and Klein, 1982). Studies like those carried out by Tan and Teo (2000), Hoppe et al. (2001), Cooper and Zmud (1990) and Tornatzky and Klein (1982) have generally shown that perceived compatibility of an innovation has a positive inuence on the adoption of the innovation. Regression analysis showed compatibility having (b 0.442, p-value 0.001). This research therefore further proves the earlier ndings that showed, internet users who feel that using EC is compatible with their working are more inclined to adopt such services. The acceptance of both H3 (complexity) and H6 (security/condentiality) is in agreement with a wide range of previous ndings (Hoppe et al., 2001; Cheung,1998; Tan and Teo, 2000; Lederer et al., 1997; Cockburn and Wilson, 1996). Multiple regression analysis shows results of complexity (b 2 0.378, p-value 0.001) and security/condentiality (b 2 0.177, p-value 0.001), indicating that complexity and security have a negative effect upon EC adoption among Malaysian electronics manufacturing rms. All of the previous studies suggest that the more complex a new technology is perceived to be, the less likely it is that it will be adopted. Similarly, perceived security/condentiality was also found to be negatively associated with the adoption since it is a major impediment to the adoption of EC. Although the ndings show that perceived trialability has a positive relationship with EC adoption intentions, this relationship is not signicant (b 0.097, p-value 0.076). One possible reason is that recently, there has been a dramatic

Variable Relative advantage Compatibility Complexity Trialability Observability Security/condentiality

Estimate 0.536 0.442 2 0.378 0.097 0.235 2 0.177

Standard error 0.123 0.118 0.087 0.094 0.105 0.100

P-value
* *0.001 * *0.001 * *0.001

Table V. Multiple regression test between EC adoption and innovation characteristics

0.076
* *0.001 * *0.001

Notes: R 2 0.75( *), adjusted R 2 0.74; p , 0.05, ( * *) p , 0.0012

increase in the number of business solutions companies in Malaysia, due to the promotion of EC by the government through Multimedia Super Corridor. It has led to high competition in the markets, whereby companies provide many special services to attract customers. Customers have many options provided by those companies and user can choose what they want: including access to a free trial, trying various applications before making a decision, implementation at a certain scale, low start-up cost or ability to get out anytime. These conditions can consequently lead to an unimportance of perceived trialability EC. Finally, the support for H5 (observability) is line with the results of Tran (2005). Multiple regression analysis shows results of (b 0.235, p-value 0.001), implying that there is a positive and signicant correlation between observability and EC adoption. This research therefore further proves the earlier ndings that showed observability as having a positive and signicant inuence on EC adoption. 5. Conclusion The purpose of this study is to investigate factors affecting intention to adopt EC in the Malaysian electronics rm context. This study also contributes to and extends our understanding of the internet as a medium for commercial use in the manufacturing arena, identifying the rationales for adopting or rejecting the internet-based EC by the electronics rms. From a managerial viewpoint, the ndings provide support for investment decisions, and for decisions relating to the development internet services that address and take the concerns and needs of companies into consideration. The research was done under diffusion of innovation theoretical framework, with security and condentiality introduced as an additional variable. The multiple regression analysis shows that Rogers perceived characteristics of innovation relative advantage, compatibility, complexity and observability were useful predictors. Compatibility and relative advantage are the factors that primarily inuence adoption of EC. Trialability was not useful predictors of adoption by electronic rms in Malaysia. Additional characteristics security and condentiality was turned out to be a signicant predictor of adoption. All non-adopters, light adopters and heavy adopters appeared to be aware of this issue. 6. Limitations While every effort was made to make this study as comprehensive as possible, certain limitations were present: (1) The samples of our study were from Klang Valley and Penang state in Malaysia. Owing to the time and cost concern limit us to cover these two regions only. This may also restrict the generalizability of the ndings. (2) The second limitation was the fact that electronic rms were our respondents for this survey. Because it was impossible to look into and analyzing the EC adoption rate in relation to all types of manufacturing companies in Malaysia. (3) The respondents self-ratings might not have been reected their true perceptions of questionnaire items. Therefore, this survey data might have some biases. Moreover, social disability bias (consciously and unconsciously) has driven the respondents to create a favourable impression) acquiescence bias (the respondents tend to agree with all questions), and deliberate falsination are

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common types of respondents errors in survey studies (Zikmund, 2000), which were limitations of this study. (4) Owing to the following main reasons, the sample may not be representative of the population: . some addresses taken were found to be wrong; . non cooperative behavior of the respondents; and . time and nancial constraints. 7. Suggestions for future studies This study was conducted to explore the factors affecting intentions to adopt EC by the electronics rms in Malaysia. As such, there is still room for further investigation into the adoption of EC. Following are some recommendations for future studies. First, future research studies are suggested to focus on comparisons between the two different manufacturers and business groups; this would help to develop the knowledge based on the successful EC adoption process. Second, as EC business is still relatively new in Malaysia, in addition to surveying businesses, researcher could examine the perception on consumers on EC usage and on adoption of it for doing business transactions. This would help to understand the better differences in both sellers and buyers views on the EC adoption. Third, longitudinal studies that use both quantitative and qualitative techniques are required to understand the changes on prior and post EC adoption in the business. Such studies could result in explanatory variables that have not been considered in this study. Finally, EC has been used in the business in so many ways, and different companies use it in different ways. Investigations could be conducted by asking people to list the priorities of EC usages in business, and further qualitative statements regarding satisfactions of EC adoption could be obtained.
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About the authors Syed Shah Alam is Senior Lecturer in the Faculty of Business Management, University Technology MARA, Malaysia. He is a doctorate in e-commerce. His teaching and research interest are internet marketing, e-commerce, mobile e-commerce. His articles on e-commerce have been published in leading international journals. Syed Shah Alam is the corresponding author and can be contacted at: syedshah@salam.uitm.edu.my; drsyedshahalam@yahoo.com.sg Ali Khatibi graduated with PhD in marketing and MBA in marketing with TQM and MBA in production with TQM. He is currently working as Director of Graduate Management Centre in University College of Technology and Management Malaysia. He has more than 23 years experience in teaching, research, and consultancy. He has been an effective resource personnel in management development program at all levels of management both in EU, SEA, ASIA, and China. E-mail: alik@kutpm.edu.my Mohd. Ismail Sayyed Ahmad is currently working at the Faculty of Economics and Management Sciences, International Islamic University, Malaysia. He has more than 40 years of experience in teaching, research and administration. Prior to joining at IIU he was the Vice President and Dean, Faculty of Management, Multimedia University, Malaysia. His areas of specialization are marketing and strategic management. His articles on marketing have been published in leading journals. E-mail: mia@iiu.edu.my Hishamuddin Bin Ismail is currently an Associate Dean and a Senior Lecturer at the Faculty of Business and Law at Multimedia University, Melaka Campus. He has published many articles in the area of customer satisfaction, customer loyalty and e-commerce in JTMA, JABC, JSS, JAMS and IIM Journal. His last post prior to being an academician was the product manager where he led a team of professionals to develop data communication related products. During his tenure, he had successfully launched new product where the main feature is to enable the customer to virtually link themselves using the managed point-to-point connection.

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