Cloud enterprise resource planning adoption framework for small and medium enterprises in Malaysia

• Main Author: Obaid, Arif Razzaq
• Format: Thesis
• Language: English; English
• Published: 2022
• Subjects: Q Science (General); QA Mathematics
• Online Access: http://eprints.utem.edu.my/id/eprint/26910/; https://plh.utem.edu.my/cgi-bin/koha/opac-detail.pl?biblionumber=122058

Cloud enterprise resource planning (ERP) is now becoming a more critical enabler for increased productivity, performance, and cost reduction in information technology (IT). This system is expected to provide advantages to all types of businesses, regardless of their scale. Cloud ERP has the potential to increase the scalability and efficiency of IT systems, allowing SMEs to concentrate on their core business and strategy growth and execution. Despite the many advantages of cloud ERP such as lower upfront and deployment costs and shorter implementation times that come with its adoption, there is a strong aversion to its adoption by many SMEs and adoption is still falling short of expectations. In general, research on the use of Cloud ERP in SMEs is limited, and there is a major research gap in the study of this innovation's adoption in SMEs. There are currently no empirical studies on the factors that affect Cloud ERP adoption in Malaysia. To fill the void, a research framework was developed based on the diffusion of innovation theory (DOI), the Iacouvo model, and critical mass theory (CMT), combined with the technology-organization-environment (TOE) framework. This research employed a quantitative method to achieve the research objectives. Data were collected from a total of 203 questionnaires out of 384 questionnaires distributed to Malaysian SMEs. For the analysis of data, the Structural Equation Modelling specifically SmartPLS-Version 3 was employed. The findings indicate that there is a significant positive relationship between technological factors (trialability, privacy & security, system quality, employee knowledge, complexity) and the adoption of cloud ERP. However, the results also indicated that compatibility and IT readiness pose an insignificant effect on the adoption of cloud ERP among SMEs in Malaysia. Moreover, the findings show that the dimensions of organizational factors (perceived benefits, financial readiness, and cost) have positively significant influences on the adoption of cloud ERP. With regards to the environmental factors hypotheses, the results indicated that government regulations and critical mass pose a significant and positive influence on the adoption of cloud ERP, whereas competitive pressure has no significant influence on the adoption of cloud ERP among SMEs in Malaysia. The findings of this study can be utilized as the basis for future studies on cloud ERP and serve as a guideline in designing cloud ERP projects.