The Influence of National Innovation System Structural Factors on eCommerce Adoption by SMEs in Botswana

Abstract

The potential role of eCommerce to safely meet the needs of consumers and businesses during the covid-19 pandemic heightened the need for eCommerce adoption. However, due to their failure and inability to appropriately develop, adopt, and use technology, developing countries have failed to reap the full benefits of eCommerce. Previous studies focused on contextual factors affecting eCommerce adoption. This thesis advances a more comprehensive and holistic understanding of eCommerce adoption factors by establishing the structural factors policymakers can derive from innovation systems when designing eCommerce policies. We map eCommerce adoption by reviewing the horizontal knowledge transfer practices among networks of SMEs, and vertically with larger businesses, academic research institutions, and public research organizations to highlight the role of knowledge on eCommerce adoption. The study follows the interpretivism philosophy to investigate national innovation system factors as motivators and antecedents of eCommerce adoption. A quantitative research approach was used, where eCommerce adoption by SMEs was treated as a variable that can be measured using a questionnaire. The questionnaire was deployed through three waves using mail, online, and face-to-face survey methods. The data used in this study were collected from 569 SMEs across seven locales in Botswana. Through exploratory factor analysis and structural equation modellingg, this study found that knowledge institutions, human capital, ICT infrastructure, and market sophistication influence eCommerce eReadiness. The study found the networks among innovation institutions, and the knowledge flows between them are a critical succes factors or for eCommerce adoption by Botswana SMEs. Overall, this paper provides new empirical assessment of innovation system structural factors as antecedents and motivating conditions of eCommerce adoption, and whether policymakers should consider them when developing eCommerce policies.