Administrative innovation applied to systems adoption

Abstract

Innovation has become not only the domain of a few progressive enterprises but the key to survival and success of the many. Innovative changes in management practices can assist in ensuring survival in an increasingly competitive world. The systems in place to manage and administer organizations are critical to exploiting technological, process, and product innovations. This paper examines the adoption and non-adoption of a particular systems innovation, Electronic Data Interchange (EDI). This empirical study of 379 companies compares adopters, adopters-in-process, and non-adopters of EDI. The focus is on the internal characteristics of firms. It is found that larger firms have a knowledge advantage which is a key factor in the adoption process. This knowledge advantage overcomes some of the misconceptions regarding EDI perceived by non-adopters. Further, critical barriers to adoption such as management support, systems cost, and implementation are important, but overcome by adopters, whereas non-adopters have difficulties in these areas. Adopters and non-adopters are compared according to their satisfaction and experience with internal systems. The exception is when implementation issues are involved. Non-adopters' perceptions are found to differ from adopters on this critical dimension. The results suggest that systems innovations may not be consistent with traditional taxonomies of innovations.