Influence of Internal Organizational Factors on E-procurement Adoption in Small and Medium-Sized Enterprises in Nyeri County Kenya

Peter Malna Gitonga ,Jotham Wasike ,Evans Sagwa

doi:10.7176/ejbm/12-33-04

Abstract

Small and Medium-Sized Enterprises (SMEs) are considered as major pillars of the modern market economies given that they play critical economic and social roles world over more so in developing countries like Kenya. Though E-procurement provides benefits that SMEs could gain from, some internal organizational factors have inhibited effective E-procurement adoption in SMEs. The objective of this study was to assess the influence of internal organizational factors on E-procurement adoption in Small and Medium-Sized Enterprises in Nyeri County Kenya. The study hypothesized that internal organizational factors do not have a significant influence on E-procurement adoption in Small and Medium-Sized Enterprises in Nyeri County Kenya. The study was guided by the Resource Based Theory. In the study, internal organizational factors was the independent variable and E-procurement adoption was the dependent variable. The study used a self-administered questionnaire for data collection that was issued to 105Small and Medium-Sized Enterprise business owners within Nyeri County. A Pilot study was conducted by administering 5 questionnaires and reliability test done by use of Cronbach alpha. Data analysis was conducted using regression and correlation analysis in order to determine the relationship between the variables. The results were presented in tables and the findings discussed. Based on the findings the study concluded that internal organizational factors like employee knowledge, size of an organization, staff retention, trust on technology and perceptions of manager, influence E-procurement adoption in Small and Medium-Sized Enterprises. The findings of this study can assist in deepening the understanding of the challenges that hinder E-procurement adoption by SMEs for managers and policy makers as well as form a body of knowledge for referencing to scholars and academicians. Keywords: Internal organizational factors, Small and Medium-Sized Enterprises, E-procurement DOI: 10.7176/EJBM/12-33-04 Publication date: November 30 th 2020

Highlights

Small and Medium-Sized Enterprises (SMEs) are known to be the engines of economic growth and development as they create employment opportunities, provide goods and services, stir innovations as well as creating a competitive edge for a country (Katua, 2014)
Small and Medium-Sized Enterprises have no universally accepted definition due to their different nature their definition can be different from sector to sector depending on the economy and the time span considered (KBA, 2016; Miller & Nyauncho, 2014; Katua, 2014)
According to Kenya National Bureau of Statistics (2017) SMEs comprise about 98% of all the Kenyan enterprises, they employ more than 80% of Kenya’s employees who directly derive their daily income from the SMEs and they are estimated to have contributed 34% of Kenya’s Gross Domestic Product (GDP)

Summary

Introduction

Small and Medium-Sized Enterprises (SMEs) are known to be the engines of economic growth and development as they create employment opportunities, provide goods and services, stir innovations as well as creating a competitive edge for a country (Katua, 2014). The SMEs are considered critical in attaining the United Nations 2030 Sustainable Development Agenda Goals, such as Goal 1 - To end poverty in the world in all its forms; Goal 8 – To promote inclusive and sustainable economic growth that ensures full, productive and decent work and employment for all; Goal 9 – To create resilient infrastructure, encourage inclusive and sustainable industrialization and nurture innovation. Small and Medium-Sized Enterprises play critical economic and social roles especially in third world countries such as Kenya (ITC, 2019). According to Kenya National Bureau of Statistics (2017) SMEs comprise about 98% of all the Kenyan enterprises, they employ more than 80% of Kenya’s employees who directly derive their daily income from the SMEs and they are estimated to have contributed 34% of Kenya’s Gross Domestic Product (GDP)

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Results

Conclusion