E-commerce and SME performance: The moderating influence of entrepreneurial competencies

Hussain, A salan e al. A icle E-comme ce and SME pe o mance: The mode a ing in luence o en ep eneu ial compe encies Adminis a i e Sciences P o ided in Coope a ion wi h: MDPI – Mul idisciplina y Digi al Publishing Ins i u e, Basel Sugges ed Ci a ion: Hussain, A salan e al. (2022) : E-comme ce and SME pe o mance: The mode a ing in luence o en ep eneu ial compe encies, Adminis a i e Sciences, ISSN 2076-3387, MDPI, Basel, Vol. 12, Iss. 1, pp. 1-16, h ps://doi.o g/10.3390/admsci12010013 This Ve sion is a ailable a : h ps://hdl.handle.ne /10419/275285 S anda d-Nu zungsbedingungen: Die Dokumen e au EconS o dü en zu eigenen wissenscha lichen Zwecken und zum P i a geb auch gespeiche und kopie we den. Sie dü en die Dokumen e nich ü ö en liche ode komme zielle Zwecke e iel äl igen, ö en lich auss ellen, ö en lich zugänglich machen, e eiben ode ande wei ig nu zen. 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Adminis a i e Sciences 12: 13. h ps://doi.o g/10.3390/ admsci12010013 Recei ed: 10 No embe 2021 Accep ed: 30 Decembe 2021 Published: 18 Janua y 2022 Publishe ’s No e: MDPI s ays neu al wi h ega d o ju isdic ional claims in published maps and ins i u ional a il- ia ions. Copy igh : © 2022 by he au ho s. Licensee MDPI, Basel, Swi ze land. This a icle is an open access a icle dis ibu ed unde he e ms and condi ions o he C ea i e Commons A ibu ion (CC BY) license (h ps:// c ea i ecommons.o g/licenses/by/ 4.0/). adminis a i e sciences A icle E-Comme ce and SME Pe o mance: The Mode a ing In luence o En ep eneu ial Compe encies A salan Hussain 1, Minhas Akba 2,3,* , A an Shahzad 4, Pe a Poulo a 3,* , Ahsan Akba 3,5 and Rohail Hassan 4 1College o Business Managemen , Ins i u e o Business Managemen , Ka achi 75190, Pakis an; [email p o ec ed] 2Depa men o Managemen Sciences, COMSATS Uni e si y Islamabad, Sahiwal Campus, Sahiwal 57000, Pakis an 3 Depa men o In o ma ics and Quan i a i e Me hods, Facul y o In o ma ics and Managemen , Uni e si y o H adec K alo e, 50003 H adec K álo é, Czech Republic; [email p o ec ed] 4O hman Yeop Abdullah G adua e School o Business (OYAGSB), Uni e si i U a a Malaysia, Kuala Lumpu 50300, Malaysia; [email p o ec ed] (A.S.); [email p o ec ed] (R.H.) 5In e na ional Business School, Guangzhou Ci y Uni e si y o Technology, Guangzhou 510080, China *Co espondence: [email p o ec ed] (M.A); [email p o ec ed] (P.P.) Abs ac : This esea ch aims o examine he media ing ole o he use o he e-comme ce and mode a ing in luence o en ep eneu ial compe encies on he pe o mance o small and medium en e p ises (SMEs). The s udy da a we e collec ed ia a s uc u ed ques ionnai e comp ised o a se en-poin Like scale om p ac i ione s se ing a he op and middle-le el posi ions in Pakis ani SMEs. The Pa ial Leas Squa es S uc u al Equa ion Modelling (PLS-SEM) echnique was applied on 250 useable e u ned ques ionnai es. The esul s showed ha he associa ion be ween he use o e- comme ce and i m pe o mance is posi i ely signi ican . Mo eo e , he use o e-comme ce media es he posi i e associa ion be ween echnological eadiness, adop ion cos , and i m pe o mance. Howe e , he mode a ing ole o en ep eneu ial compe encies does no appea as signi ican be ween he use o e-comme ce and manu ac u ing SMEs’ pe o mance. The p esen s udy is he i s o explo e en ep eneu ial compe encies as a mode a o be ween e-comme ce adop ion and i m pe o mance. The empi ical ou comes o his esea ch p o ide use ul heo e ical and p ac ical implica ions o he manage s and p ac i ione s o unde s and he unde lying ac o s o he success ul implemen a ion o e-comme ce in he SME sec o o enhance i m pe o mance. Keywo ds: e-comme ce; en ep eneu ial compe encies; small and medium en e p ises; echnological eadiness; adop ion cos ; esou ce-based iew; di usion o inno a ion; Pakis an 1. In oduc ion En e p ise pe o mance has gained conside able ac ion in ecen yea s (Akba e al. 2021a;Qu eshi e al. 2021;Akba e al. 2021b). Co po a e pe o mance is equally impo an o p ac i ione s and academicians in he mode n business e a. Some esea che s ha e analyzed i m pe o mance b oadly in e ms o inancial and non- inancial indica o s (Han and Hong 2019;Qu eshi e al. 2021). Howe e , co po a e manage s usually employ speci ic pe o mance indica o s such as sales inc emen , inc eased ma ke e u n, in es men g ow h, and e u n on in es men on a yea - o-yea basis o measu e inancial pe o mance (Combs e al. 2006;Rajan e al. 2007). Likewise, he i m’s non- inancial pe o mance can be measu ed by cus ome sa is ac ion, ad anced echnological inno a ion, he pe cei ed alue o he p oduc , employee sa is ac ion, and educ ion in p oduc ion ime (Aziz e al. 2017;Fan azy e al. 2010). In a simila con ex , small and medium en e p ises’ pe o mances a e a signi ican conce n o indus ializa ion and he g ow h o mode n economies (Rajan e al. 2007;Shan- mugam 2016), since i plays an impe a i e ole in echnological inno a ion in he con ex o Adm. Sci. 2022,12, 13. h ps://doi.o g/10.3390/admsci12010013 h ps://www.mdpi.com/jou nal/admsci Adm. Sci. 2022,12, 13 2 o 16 business managemen (Nasu edin e al. 2016). In he mode n business e a, o ganiza ions inc easingly push c ea i i y and inno a ion o ake ad an age o new oppo uni ies o suc- cess ul business g ow h (Halim e al. 2015). Cu en ly, mul ina ional i ms a e concen a ing on he indus ial e olu ion 4.0 (Bousdekis e al. 2019). Likewise, digi al echnology has comple ely changed he ope a ional p ocess o small-scale indus ies. The global economy is mo ing owa ds he di e se ad an ages o Indus y 4.0; he esul is a highe quali y o goods by lowe ing p oduc ion cos s by au oma ion, a i icial in elligence, and 3D p in ing inno a ions (Bousdekis e al. 2019). which would ul ima ely imp o e i m compe i i eness. The apid g ow h in echnological inno a ion a ec s la ge- as well as small-scale indus ies. Among he la ges indus ies in Pakis an, conside ing o al esou ces, i is no un- easonable o say ha Pakis an’s manu ac u ing indus y is he coun y’s leading sec o . Manu ac u ing SMEs a e conside ed he spin o he economy in Pakis an. Acco ding o Raza e al. (2017), SMEs con ibu e signi ican ly o he economy o Pakis an, and 90% o all p i a e en e p ises a e egis e ed as SMEs. In Pakis an, he o al numbe o egis e ed businesses is a ound 3.2 million; app oxima ely 90% o he businesses a e co e ed unde he de ini ion o an SME (SMEDA 2018). Al hough de eloping coun ies’ SMEs con ibu e o a ound 70% o he GDP, SMEs’ con ibu ions o he GDP o he Pakis ani economy is app oxima ely 40% and lags behind hei neighbo ing coun ies by a ound 30%. In addi ion, he manu ac u ing sec o is an essen ial sou ce o ax e enues and con- ibu es o inc easing se e al job oppo uni ies o semi-skilled, skilled, and unskilled labo . Thus, he go e nmen o Pakis an has in ensi ied ocus on he ad ancemen and de elop- men o he manu ac u ing indus y. Fou majo ca ego ies all unde he manu ac u ing SMEs o Pakis an, namely, ex ile, lea he , su gical ins umen , and spo s (Kazmi 2017). A imes, he ex ile indus y was he signi ican d i e o he economy o Pakis an in e ms o employmen gene a ion and coun y expo s. Howe e , he SME sec o is se e ely a ec ed by a lack o inno a ion capabili y and less ocus on echnological upg ada ion (Bilal e al. 2016). The sha e o ex ile SMEs in he global ma ke has emained s agnan a 1.6% Simila ly, he lea he indus y comp ises ou sub-sec o s: ga men s, glo es, shoe uppe s, and lea he goods (Kazmi 2017). Acco ding o he Pakis an Tanne Associa ion (PTA 2015), he lea he indus y ea ned 948 million USD yea ly om i s expo s (Khan and Ali 2020). A p esen , he lea he indus y’s expo g ow h also had a nega i e change o 8.41 pe cen (EconomicSu ey 2019). Likewise, spo s goods SMEs play an essen ial ole in he manu ac u ing sec o . The e is a b oad ca ego y o spo s p oduc s in manu ac u ing uni s such as polo s icks, hockey s icks, and c icke ba s (Kazmi 2017). A p esen , he spo s goods indus y shows a nega i e g ow h o 9.04 pe cen in e ms o expo s (EconomicSu ey 2019). Las ly, he expo e s and manu ac u e s o su gical ins umen s mainly deal wi h he su gical indus ies, e e ina y ins umen s, den al ins umen s, ailo scisso s, beau y salon ins umen s, manicu e and pedicu e i ems, and hai s ylis scisso s. Mo eo e , a ound 1900 SME su gical uni s p oduce a ange o 10 o 500 p oduc s by using app oxima ely 100,000 wo ke s (The Financial Daily 2018). P esen ly, Pakis an’s su gical ins umen indus y con ibu es 221.7 million USD in o al expo s o 2017–2018. Howe e , in 2018–2019, Pakis ani su gical SMEs expe ienced nega i e expo g ow h (Pakis an Bu eau o S a is ics 2019). Theo e ically, p e ious esea che s ha e examined he adop ion o big da a, usage o ERP (Yadega idehko di e al. 2020), use o e-go e nmen (He edia-Calzado and Du éndez 2019), and use o e-ma ke ing (Sheikh e al. 2018) as a media o . Mo eo e , p e ious schola s ha e sugges ed de eloping a model using e-comme ce adop ion/usage as a media ing a iable o de eloping coun ies (Hassen e al. 2019). Simila ly, based on he RBV heo y, en ep eneu ial compe ency is also a aluable esou ce, and he heo y a gues ha esou ces may e en ually lead owa ds business success and pe o mance (Kabi e al. 2017;Tehseen and Ramayah 2015). On he con a y, he e is a dea h o esea ch o explo e he causal ela ionship be ween in o ma ion communica ion echnology (e-comme ce) and p oduc i i y (DeS e ano e al. 2018). These inconsis en esul s sugges ed a need o apply a mode a o be ween he use o e-comme ce and i m pe o mance. Hence, in he p esen Adm. Sci. 2022,12, 13 3 o 16 s udy, en ep eneu ial compe ency is a mode a o be ween Technological, o ganiza ional, and en i onmen al (TOE) ac o s and he pe o mance o SMEs. The i s objec i e o his s udy is o examine he in luence o TOE con ex ac o s on he use o e-comme ce. Second, he pape examines o wha ex en does he use o e-comme ce media e he ela ionship be ween TOE ac o s and i m pe o mance. Thi d, he s udy add esses he mode a ing ole o en ep eneu ial compe encies be ween he use o e-comme ce and SMEs’ i m pe o mance. This a icle is u he di ided in o ou sec ions. Sec ion 2co e s he compelling li e a u e and de elopmen o he heo e ical amewo k. In Sec ion 3, he esea ch design and i s speci ic ing edien s a e discussed. Sec ion 4explains he analysis and esul s o iden i ied hypo heses. Las ly, Sec ion 5concludes he p esen s udy and p o ides he limi a ions o his esea ch pape . 2. Li e a u e Re iew 2.1. Technological Readiness and Use o E-Comme ce Technological eadiness is e e ed o as “ he combina ion o IT in as uc u e and IT human esou ces” (Zhu and K aeme 2005). These esou ces a e obliga o y i o ganiza ions wan o in oduce e-comme ce in hei business ope a ions (Capu o e al. 2019;Oli ei a and Ma ins 2010a). Manage s iden i y di e en choices o adop echnologies in hei o ganiza ions. Simila ly, i is also ound by Zhu e al. (2003) ha IT in as uc u e and human skills o employees a e wo signi ican ac o s owa ds echnological adop ion. Thus, he combined e ec o IT in as uc u e and IT human esou ce expe ise ( echnological eadiness) needed u he in es iga ion. The p e ious li e a u e depic s ha he IT in as- uc u e and IT human skills’ ole signi ican ly in luences i m pe o mance pe o mance (B aojos e al. 2019;Capu o e al. 2019). On he con a y, Hyung and Dedahano (2014) examined ha he associa ion be ween echnological inno a ion and pe o mance is signi ican ly weak. Hence, u he in es iga- ion is equi ed o explo e IT in as uc u e and IT expe s’ combined e ec on e-comme ce usage. The e o e, he hypo hesis is p oposed as ollows: Hypo hesis 1. Technological eadiness has a posi i e signi ican impac on he use o e-comme ce. 2.2. Adop ion Cos and Use o E-Comme ce The adop ion o echnology such as e-comme ce needs some essen ial echnological esou ces, o ins ance, IT in as uc u e, in e ne ne wo k, so wa e, ha dwa e, and IT pe sonnel. All o hese necessi ies a e qui e expensi e, pa icula ly o small and medium i ms. Mo eo e , cos emains a signi ican impedimen in adop ing/using echnology, pa icula ly o SMEs (Wyme and Regan 2015). Al hough he adop ion cos o ce ain echnological inno a ions also dis esses he speed o echnological adop ion, in he p esen s udy, adop ion cos s included bo h ini ial echnology usage and aining cos s o use ha echnology. Addi ionally, he adop ion cos was conside ed essen ial o e-comme ce usage (Domun and Bheemul 2019). Fu he mo e, he money o esou ces spend o adop hese echnologies di ec ly in luence he speed o usage o ha pa icula echnology, especially in small businesses (Moh a amzadeh e al. 2018). The e o e, he e is a need o u he in es iga e he adop ion cos and he use o e-comme ce. Hypo hesis 2. Adop ion cos nega i ely in luences he use o e-comme ce. 2.3. Go e nmen Suppo and Use o E-Comme ce Go e nmen suppo means he encou aging businesses o use echnology. Go e n- men suppo plays an essen ial ole in making he indus y policies e ec i e (Manning e al. 2012), and in imp o ing o ganiza ional inno a i eness In de eloping coun ies such as China, he go e nmen has s a ed many suppo p og ams by c ea ing subsidia ies a di e en le els o suppo SMEs (Lin and Luan 2020). Go e nmen s mainly ocus on Adm. Sci. 2022,12, 13 4 o 16 la ge indus y policies such as inancial incen i es c i e ia, and aining and de elopmen p og ams o adop new echnologies (Me hi and Ahluwalia 2017). Thus, i is easonable o u he s udy he go e nmen suppo o SMEs, pa icula ly o echnological inno a- ion such as he use o e-comme ce. The e o e, he cu en s udy p oposed he ollowing hypo hesis: Hypo hesis 3. Go e nmen suppo posi i ely in luences he use o e-comme ce. 2.4. Use o E-Comme ce and Fi m Pe o mance In he digi iza ion e a, echnological inno a ion is an essen ial elemen o be success ul among compe i o s. Simila ly, he adop ion o echnology such as e-comme ce is changing he way businesses a e conduc ed ac oss he wo ld (Sunayana and Pa een 2019). Hence, business ope a ions a e becoming mo e e ec i e and compe i i e in he e a o digi al echnology. Addi ionally, he li e a u e highligh s conside able e idence ha e-comme ce usage has a posi i e in luence on he pe o mances o small and medium indus ies (SMIs) by imp o ing business p ocesses (Wa doyo e al. 2018). Mo eo e , i is also in es iga ed ha e-comme ce as a media ing a iable needs u u e esea ch o be be e unde s ood (Hassen e al. 2019). Likewise, he in luence o e-business is also posi i e on o ganiza ional pe o mance. The e o e, he p esen s udy posi s he ollowing hypo hesis: Hypo hesis 4. The use o e-comme ce is posi i ely signi ican on he i m pe o mance. 2.5. En ep eneu ial Compe encies Rela ionship wi h Fi m Pe o mance Acco ding o Boya zis (1982) compe encies ela ed o manage s ha e wo b oad dimen- sions. The i s ype is ela ed o human beha io , which has wen y-one di e en ypes. The second ype o compe ency has h ee dimensions such as ai s, social oles, and skills. Based on he ypes men ioned abo e, manage s ha e di e en capabili ies ha in luence pe o mance. By de ini ion, he e m en ep eneu ial compe encies e e o “en ep eneu s’ o e all sum o a ibu es such as belie s, a i udes, skills, knowledge, pe sonali y, abili ies beha io al endencies and expe ise needed o sus aining and success ul en ep eneu ship” (Kiggundu 2002). Simila ly, consis en wi h he abo e s udy, Ge li e al. (2011) concluded ha en- ep eneu ial compe ency is di ec ly ela ed o business pe o mance and esul in highe en ep eneu ial pe o mance. O he au ho s also sugges ed ha s a egic ac o s such as en ep eneu ial compe encies signi ican ly impac SME pe o mance (G imme e al. 2017; Hashim e al. 2018). The e o e, he p esen s udy p oposed he ollowing hypo hesis. Hypo hesis 5. En ep eneu ial compe encies ha e a signi ican in luence on i m pe o mance. 2.6. The Media ing Role o Use o E-Comme ce be ween TOE Model and Fi m Pe o mance Technological esou ces a e conside ed c i ical ac o s in he success o in o ma ion sys ems (ISs) (Zain e al. 2005). Acco ding o p e ious esea che s, echnological eadiness means combining wo esou ces: IT human esou ce and IT in as uc u e (Zhu and K ae- me 2005). Bo h a e an essen ial pa o i ms’ ope a ions i he i m wan s o use e-business (Oli ei a and Ma ins 2010a). Simila ly, Teo and Rangana han (2004) also sugges ha , i any i m adop s e-comme ce, i will be mo e likely o imp o e i s IT in as uc u e. Like- wise, Oli ei a and Ma ins (2010b) also de e mine ha companies wi hou su icien IT skills a e less likely o adop e-comme ce in hei ope a ions. S udies ha e emphasized ha o ganiza ional ac o s co ela e wi h business pe o - mance, pa icula ly in SMEs (Bala and Feng 2019). Fu he mo e, Sila (2010) con i med ha e-comme ce usage does no di ec ly in luence he i m’s ope a ional pe o mance. Howe e , i can enhance ope a ional e iciency, which subsequen ly inc eases ope a ional pe o - mance. The e o e, he e is an ex ensi e need o u he s udy he adop ion o echnology as Adm. Sci. 2022,12, 13 5 o 16 a media o be ween o ganiza ional ac o s such as adop ion cos and i m pe o mance o SMEs. Mo eo e , he implemen a ion o echnology such as elec onic comme ce is a di icul ask wi hou he go e nmen ’s suppo , pa icula ly o SMEs. Simila ly, he li e a u e sup- po s he posi i e co ela ion be ween go e nmen suppo and echnology usage bu he esul s a e inconsis en . The e o e, o assess he impac o go e nmen suppo ega ding echnological adop ion, he e is a need o u he empi ical in es iga ion. Addi ionally, go e nmen suppo posi i ely a ec s i m pe o mance (Han e al. 2017). Thus, he abo e discussion o mula es he ollowing hypo heses. Hypo hesis 6. The use o e-comme ce media es he ela ionship be ween echnological eadiness and i m pe o mance. Hypo hesis 7. The use o e-comme ce media es he ela ionship be ween adop ion cos and i m pe o mance. Hypo hesis 8. The use o e-comme ce media es he ela ionship be ween go e nmen suppo and i m pe o mance. 2.7. En ep eneu ial Compe encies as a Mode a o be ween he Use o E-Comme ce and Fi m Pe o mance In p e ious li e a u e, i was obse ed ha small i ms’ pe o mances a e in luenced by s a egic ac o s o he o ganiza ion such as en ep eneu ial compe encies (G imme e al. 2017). The RBV heo y p o ides heo e ical unde pinning o en ep eneu ial compe encies as capabili ies o ob ain a compe i i e ad an age and o enhance i m pe o mance (Kabi e al. 2017). Mo eo e , i is also sugges ed ha e-comme ce has a signi ican in luence on h ee di e en dimensions o pe o mance: inc eased sales, e iciency and p oduc i i y, and coo dina ion (K aeme e al. 2005). On he con a y, he e is no causal impac o echnological inno a ion and p oduc i i y (DeS e ano e al. 2018). The e o e, based on he abo e discussion, he p esen s udy has p oposed a mode a o be ween he use o e-comme ce and i m pe o mance. Hypo hesis 9. En ep eneu ial compe encies posi i ely mode a e he ela ionship be ween he use o e-comme ce and i m pe o mance o SMEs. 2.8. Theo e ical F amewo k The heo e ical ounda ion o he cu en s udy is based on he unde lying p inciples o Resou ce Base View (RBV) heo y p o ided by Ba ney in 1991. Acco ding o RBV, he compe i i e ad an age o i ms esul s om o ganiza ional esou ces ha a e aluable, unique, and di icul o imi a e. Likewise, esou ces ela ed o echnological eadiness and adop ion cos a e equi ed o acqui e ce ain echnologies such as e-comme ce o enhance he o ganiza ions sys em e iciency and o gain he ad an ages o echnological eadiness. Howe e , go e nmen suppo is ano he signi ican ac o ha can d i e i ms o use e-comme ce o con inuously enhance i m pe o mance wi h he help o en ep eneu ial compe ency. Howe e , he speci ic compe encies o SMEs’ en ep eneu s a e essen ial o success ully iden i ying business oppo uni ies. Likewise, he DOI heo y was in oduced by Roge s in his book Di usion o Inno a ion, which was i s published in 1962, wi h a ew mo e edi ions a e wa ds (1971, 1983, 1995, and 2003). Roge explained inno a ion as “an idea, p ac ices, o objec ha is pe cei ed o be new by an indi idual o ano he uni o adop ion”. The heo y has suppo ed echnology usage s udies (Moh a amzadeh e al. 2018). Likewise, e-comme ce has been applied in man- u ac u ing SMEs o enhance e iciency and ul ima ely o achie e a compe i i e ad an age o e i als. The e o e, based on DOI heo y, echnological adop ion (e-comme ce) owa ds i m pe o mance is suppo ed by DOI heo y. Adm. Sci. 2022,12, 13 6 o 16 In addi ion, in echnological inno a ion s udies, he TOE model is equen ly used (Hussain e al. 2020). This heo y says ha i m s uc u e should i i s o ganiza ional and en i onmen al needs (Law ence and Lo sch 1967). A e wa ds, in 1990, To na zky and Fleische emphasized ha adop ing echnology in an en e p ise is a mul idimensional and c i ical decision in luenced by se e al ac o s. In his amewo k, To na zky and colleagues iden i ied and classi ied he ac o s in o h ee con ex s: TOE. The con ex s abo e o he model ac as an oppo uni y and/o cons ain o “ echnological inno a ion”. Mo eo e , se e al s udies ha e depic ed he TOE amewo k wi h ins i u ional heo y heo y (Oli ei a and Ma ins 2010b;Zhu e al. 2006). Fo example, he adop ion p edic o s in DOI include indi idual leade cha ac e is ics and in e nal o ganiza ion cha ac e is ics ha a e compa ible wi h he o ganiza ional con ex o he TOE. Likewise, he sys em openness in DOI is compa ible wi h he TOE ac o s as shown in Figu e 1. Finally, esea che s implici ly emphasized ha Roge s’s inno a ion a ibu es a e compa ible wi h he echnological con ex (Bake 2012;Zhu e al. 2006). Adm. Sci. 2022, 12, x FOR PEER REVIEW 6 o 16 Likewise, he DOI heo y was in oduced by Roge s in his book Di usion o Inno a- ion, which was i s published in 1962, wi h a ew mo e edi ions a e wa ds (1971, 1983, 1995, and 2003). Roge explained inno a ion as “an idea, p ac ices, o objec ha is pe - cei ed o be new by an indi idual o ano he uni o adop ion”. The heo y has suppo ed echnology usage s udies (Moh a amzadeh e al. 2018). Likewise, e-comme ce has been applied in manu ac u ing SMEs o enhance e iciency and ul ima ely o achie e a compe - i i e ad an age o e i als. The e o e, based on DOI heo y, echnological adop ion (e- comme ce) owa ds i m pe o mance is suppo ed by DOI heo y. In addi ion, in echnological inno a ion s udies, he TOE model is equen ly used (Hussain e al. 2020). This heo y says ha i m s uc u e should i i s o ganiza ional and en i onmen al needs (Law ence and Lo sch 1967). A e wa ds, in 1990, To na zky and Fleische emphasized ha adop ing echnology in an en e p ise is a mul idimensional and c i ical decision in luenced by se e al ac o s. In his amewo k, To na zky and col- leagues iden i ied and classi ied he ac o s in o h ee con ex s: TOE. The con ex s abo e o he model ac as an oppo uni y and/o cons ain o “ echnological inno a ion”. Mo eo e , se e al s udies ha e depic ed he TOE amewo k wi h ins i u ional he- o y heo y (Oli ei a and Ma ins 2010b; Zhu e al. 2006). Fo example, he adop ion p edic- o s in DOI include indi idual leade cha ac e is ics and in e nal o ganiza ion cha ac e - is ics ha a e compa ible wi h he o ganiza ional con ex o he TOE. Likewise, he sys em openness in DOI is compa ible wi h he TOE ac o s as shown in Figu e 1. Finally, e- sea che s implici ly emphasized ha Roge s’s inno a ion a ibu es a e compa ible wi h he echnological con ex (Bake 2012; Zhu e al. 2006). I is indispu able ha he use o e-comme ce has g own as a popula esea ch a ea o schola s since he 1990s, a e he comme cializa ion o he in e ne . Howe e , Roge ’s Di usion o inno a ion (DOI) heo y has been used mo e equen ly in e-comme ce adop- ion s udies (Al-Bak i and Ka sioloudes 2015; Al-Qi im 2007). Howe e , e y ew s udies ha e looked in o he Technology, O ganiza ional, En i onmen al (TOE) model wi h DOI and RBV heo ies. Figu e 1. Theo e ical amewo k. Figu e 1. Theo e ical amewo k. I is indispu able ha he use o e-comme ce has g own as a popula esea ch a ea o schola s since he 1990s, a e he comme cializa ion o he in e ne . Howe e , Roge ’s Di - usion o inno a ion (DOI) heo y has been used mo e equen ly in e-comme ce adop ion s udies (Al-Bak i and Ka sioloudes 2015;Al-Qi im 2007). Howe e , e y ew s udies ha e looked in o he Technology, O ganiza ional, En i onmen al (TOE) model wi h DOI and RBV heo ies. 3. Me hodology Resea ch Design, Popula ion, and Sampling Technique The esea ch design combines esea ch componen s in o a easonable, logical, and e icien me hod. In eg a ing an o e all s a egy by measu ing and analyzing da a ensu es e ec i e, c edible, and sys ema ic ways o esol e esea ch p oblems and o answe esea ch ques ions. The esea ch design makes su e ha he esea ch ques ions a e as accu a ely answe ed as possible by he da a ga he ed o he esea ch (Kuma 2019). Adm. Sci. 2022,12, 13 7 o 16 In Pakis an, a ound 3.2 million businesses a e egis e ed; among hem, app oxima ely 90% o he companies a e ca ego ized in o small and medium en e p ises wo ldwide (SMEDA 2018). Howe e , 254 manu ac u ing SMEs we e selec ed by ollowing he sam- ple size able by Mo gan (2012) using he “clus e andom sampling echnique”. The popula ion was di ided in o ou clus e s on he geog aphical dis ibu ion o p o inces such as Sindh, Punjab, Balochis an, and Khybe Pakh unkhwa. Howe e , he Sindh and Punjab p o inces we e selec ed andomly because hey ha e la ge manu ac u ing SMEs. The e o e, six hund ed (600) ques ionnai es we e sys ema ically sen ia a Google Fo m link o he op and middle-le el manage s. The cu en s udy ques ionnai e was adap ed om p e ious s udies; he i m pe o mance scale was adap ed om (Deshpandéand Fa ley 1998;Jawo ski and Kohli 1993). Likewise, se en i ems we e adap ed om he s udy conduc ed by Gibbs and K aeme (2004) o measu e he use o e-comme ce; he ques ionnai e ela ed o he echnological eadiness was adap ed om Molla and Licke (2005) o measu e op managemen suppo , he ou -i em scale by Soliman and Janz (2004) was adap ed; and compe i i e p essu e was measu ed using he Jawo ski and Kohli (1993) ques ionnai e. Las ly, he mode a ing ole o en ep eneu ial compe encies was measu ed using he ou -i em ques ionnai e om (Man e al. 2008). This da a collec ion ook almos six and a hal mon hs, s a ing om May 2020 o Decembe 2020. As men ioned in Table 1, 287 ques ionnai es we e e u ned, ou o which 37 ques ionnai es we e no included in he analysis because hey we e inco ec ly illed o incomple e. Thus, 250 ques ionnai es we e used o he analyses. Table 1. Ques ionnai e dis ibu ion and esponse a e. Ques ionnai e Response Ra e Ques ionnai es dis ibu ed 600 Numbe o ques ionnai es e u ned 287 Ques ionnai es no ma ching he c i e ia 21 Ques ionnai es, no comple e 16 Usable ques ionnai es 250 Pe cen age o e u ned ques ionnai es 47.8% Pe cen age o usable ques ionnai e 41.6% 4. Da a Analysis and Findings The p esen s udy employed SPSS 25 o measu e he desc ip i e s a is ics o he s udy. Simila ly, o in e en ial s a is ics, he s udy used S uc u al Equa ion Modeling (SEM) by employing a Pa ial Leas Squa e (PLS) 3.3.2 o da a analysis pu poses Sa s ed e al. (2017). 4.1. Responden s’ P o ile Table 2depic s a gende analysis o male pa icipan s wi h a esponse a e o 74.8% in he demog aphic analysis, while he emale esponse a e was 25.2%. In Pakis ani Manu ac u ing SMEs, he age g oup o he manage s e ealed ha 38.8% o he esponden s a e in he age b acke o 31–40 yea s. Las ly, he “Expe ience o using e-comme ce” da a e i ied ha mos o he manage s who pa icipa ed and had expe ience using e-comme ce belong o he ca ego y 1 o 3 yea s. Adm. Sci. 2022,12, 13 8 o 16 Table 2. Demog aphic analysis. Demog aphics Responden s Pe cen age (%) F equency Pe cen age Gende Male 187 74.8 Female 63 25.2 Age-G oup 21–30 yea s 63 25.2 31–40 yea s 97 38.8 Mo e han 40 yea s 90 36.0 Expe ience Using E-Comme ce Below 1 yea 65 26.0 Be ween 1 o 3 yea s 103 41.2 Mo e han 3 yea s 82 32.8 4.2. Assessmen o Measu emen Model Rega ding he assessmen o he measu emen model, also e med he ou e model, he p esen s udy analyzed he disc imina e alidi y and in e nal consis ency eliabili y (Hai e al. 2013), as shown in Figu e 2. Adm. Sci. 2022, 12, x FOR PEER REVIEW 8 o 16 Table 2. Demog aphic analysis. Demog aphics Responden s Pe cen age (%) F equency Pe cen age Gende Male 187 74.8 Female 63 25.2 Age-G oup 21–30 yea s 63 25.2 31–40 yea s 97 38.8 Mo e han 40 yea s 90 36.0 Expe ience Using E-Comme ce Below 1 yea 65 26.0 Be ween 1 o 3 yea s 103 41.2 Mo e han 3 yea s 82 32.8 4.2. Assessmen o Measu emen Model Rega ding he assessmen o he measu emen model, also e med he ou e model, he p esen s udy analyzed he disc imina e alidi y and in e nal consis ency eliabili y (Hai e al. 2013), as shown in Figu e 2. Figu e 2. PLS algo i hm measu emen model. 4.2.1. In e nal Consis ency Reliabili y and Con e gen Validi y The in e nal eliabili y can be de e mined by conside ing he composi e eliabili y (CR) o he cons uc s. Table 3 p edic ed ha all o he CR alues a e abo e he s anda d alue 0.60 Hai e al. (2013). The con e gen alidi y (CR) was explained by Hai e al. (2013) as “ he deg ee o which a la en cons uc explains he a iance o i s indica o s”. Mo eo e , 50% o he a iance should be achie ed by each cons uc (AVE ≥ 0.50). The ollowing Table 3 depic ed ha he alues a e highe han 0.05. Fu he mo e, he c oss- loading o each cons uc mus be highe han 0.05 (Hai e al. 2013). The ollowing able e eals ha all o he alues o loading a e be ween he age o 0.646 and 0.955. Figu e 2. PLS algo i hm measu emen model. 4.2.1. In e nal Consis ency Reliabili y and Con e gen Validi y The in e nal eliabili y can be de e mined by conside ing he composi e eliabili y (CR) o he cons uc s. Table 3p edic ed ha all o he CR alues a e abo e he s anda d alue 0.60 Hai e al. (2013). The con e gen alidi y (CR) was explained by Hai e al. (2013) as “ he deg ee o which a la en cons uc explains he a iance o i s indica o s”. Mo eo e , 50% o he a iance should be achie ed by each cons uc (AVE ≥ 0.50). The ollowing Table 3depic ed ha he alues a e highe han 0.05. Fu he mo e, he c oss-loading o Adm. Sci. 2022,12, 13 15 o 16 Kazmi, S. Kamal Hayde . 2017. Lea he Indus y Re iew. 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