Factors That Influence Adoption of Cloud Computing: An Empirical Study of Australian SMEs

Abstract

Cloud computing is a recent computing paradigm enabling organizations to have access to sophisticated computing services via the Internet on a fee-for-service basis. It provides Small and Medium-sized Enterprises (SMEs) with opportunities to become as technologically advanced as their larger counterparts, without significant financial outlays. This paper examined the important factors that influence SMEs’ adoption of cloud computing technology. Drawing upon aspects of the Technology, Organization and Environment framework and Diffusion of Innovation Theory, we developed a research model of SMEs’ adoption of cloud computing and tested it through an online survey of 149 Australian SMEs. Data was analyzed using multiple regression methods, with results showing that SMEs were influenced by factors related to advantaging their organizational capability (i.e., relative advantage, quality of service and awareness) rather than risk-related factors (i.e., security, privacy and flexibility). The findings offer insights to SMEs owners, Cloud service providers and government in establishing Cloud computing adoption strategies for SMEs.