Exploring the Adoption of E-Commerce among Small and Medium Enterprises in Saudi Arabia: A Technology-Organization-Environment Perspective

Abstract

This study investigates the factors influencing e-commerce adoption among Saudi Arabian Small and Medium Enterprises (SMEs) using the Technology-Organization-Environment (TOE) framework. The research aims to identify key determinants that either facilitate or hinder e-commerce adoption in the Saudi context. A web-based survey was conducted among 480 Saudi Arabian SMEs (32% owners, 68% managers), employing multiple regression analysis to test eight hypotheses derived from the TOE framework. Variables were measured using established scales with Cronbach's alpha exceeding 0.80, examining eight independent variables across technological, organizational, and environmental contexts. Results revealed technology infrastructure as the strongest predictor (β = .576, p < .001), followed by IT human resources (β = .341, p < .001), business infrastructure (β = .156, p = .008), business partner pressure (β = .123, p = .039), and technical infrastructure (β = .075, p = .015). Notably, competitive pressure, government support, and firm size did not show significant influence on e-commerce adoption. The model explained 33.3% of the variance in e-commerce adoption. Study limitations include its cross-sectional design, sample size representing less than 10% of total Saudi SME population, and potential limited generalizability beyond the Saudi Arabian context. Future research should consider longitudinal studies and cross-country comparisons. The findings suggest organizations should prioritize investment in technology infrastructure and IT human resources, while policy makers need to reassess current support mechanisms for SME digital transformation. Technology providers should focus on integrated solutions addressing both technical and business infrastructure needs. These results can inform strategies to achieve Saudi Vision 2030 digital transformation goals. This study provides the first comprehensive analysis of e-commerce adoption factors among Saudi SMEs using the TOE framework, challenging traditional assumptions about technology adoption drivers and offering evidence-based insights for stakeholders involved in Saudi Arabia's digital transformation.