Determinants of EDI adoption in the transportation industry
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Determinants of EDI adoption in the transportation industry G Premkumar1, K Ramamurthy2 and M Crum3 1
College of Business, Iowa State University, Ames, IA 5001; 2 College of Business Administration, University of WisconsinMilwaukee, Milwaukee, WI 53201; and 3College of Business, Iowa State University, Ames, IA 5001, USA This study examines the impact of various environmental, organizational, and technological factors on the adoption of innovation in the context of electronic data interchange (EDI). Based on research in information technology (IT) adoption, organizational studies and marketing a comprehensive research model is developed. The model identifies eleven variables, under three broad categories (environmental, organizational, and innovation characteristics), that could potentially influence the adoption of EDI. The research variables are operationalised using multi-item indicators and data collected from a large scale field survey of 950 firms in the trucking industry. A total of 181 firms responded to the survey with near equal number of adopters and non-adopters. Multivariate discriminant analysis is used to determine the impact of each of these variables on EDI adoption. The results of data analysis indicate that four factors are important to discriminate adopters from non-adopters of EDI in the transportation industry. They are: size of the firm, competitive pressure, customer support, and top management support.
Introduction Electronic data interchange (EDI) is significantly changing the way business is conducted between organizations and these changes are having a significant impact on most industries. A substantial amount of information flow occurs across various organizational entities – suppliers, customers, banks, and transportation carriers – for the completion of a business transaction in the supply chain. A variety of media is used for these communications including paper, face-to-face, telephone, fax, and electronic communication between computers. Since the information communication activity is a labour intensive process, a switch to electronic communication would significantly improve the efficiency of the process. EDI, an automated and structured form of transaction communication between trading partners, provides the technological solution to improve the efficiency of operations (McGee, 1987). The initial electronic links were established between customers and suppliers. However, the growth in just in time (JIT) and quick response systems has triggered the need to include other agencies, such as transportation carriers, in the EDI network to ensure the efficiency of the overall supply chain. In the transportation industry EDI can help to provide electronic bills of lading, delivery tracking, freight billing, electronic funds transfer, etc, resulting in reduced paper processing and immediate access to information. Firms are increasingly feeling the competitive pressure to use EDI in order to maintain the exis
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