An Institutional Trust Perspective of Cloud Adoption Among SMEs in South Africa

Abstract

The purpose of this paper is to identify the major institutional trust mechanisms that facilitate the adoption of cloud services among South African SMEs. By drawing from Giddens’ (1990) institutional trust theory and the existing IT trust literature, we developed a conceptual model to improve our understanding of the role of institutional trust between SMEs and cloud service providers. The model was also deployed as a sensitizing framework to deepen our understanding of how institutional trust factors influence SME cloud service adoption decisions. A qualitative field study based on 12 semi-structured interviews of SMEs and cloud service providers in South Africa suggests that the insights gleaned from concepts, such as design faults and operator failure, can be translated into useful policy guidelines for cloud service providers, state institutions and regulatory bodies that are working to improve the trustworthiness of the cloud ecosystem. Despite the belief held by experts that there is a need to strengthen institutional mechanisms in the cloud ecosystem, the relative advantage of cloud over alternative technology remains the primary motivational factor of SME adoption. The SMEs in this study were unaware of the risks involved in cloud adoption and are content to mimic the behavior of their peers when adopting cloud services. Other social actors in society will have to play a prominent role in evaluating and strengthening institutional trust in the cloud ecosystem.