How do collaborative technologies Affect Innovation in sMEs?

International Journal of e-Collaboration, 4(4), 33-50, October-December 2008 33

How do Collaborative Technologies Affect Innovation in SMEs? Angel Luis Meroño-Cerdán, Universidad de Murcia, Spain Pedro Soto-Acosta, Universidad de Murcia, Spain Carolina López-Nicolás, Universidad de Murcia, Spain

Abstract This study seeks to assess the impact of collaborative technologies on innovation at the firm level. Collaborative technologies’ influence on innovation is considered here as a multistage process that starts at adoption and extends to use. Thus, the effect of collaborative technologies on innovation is examined not only directly, the simple presence of collaborative technologies, but also based on actual collaborative technologies’ use. Given the fact that firms can use this technology for different purposes, collaborative technologies’ use is measured according to three orientations: e-information, e-communication, and e-workflow. To achieve these objec� tives, a research model is developed for assessing, on the one hand, the impact of the adoption and use of collaborative technologies on innovation and, on the other hand, the relationship between adoption and use of collaborative technologies. The research model is tested using a dataset of 310 Spanish SMEs. Keywords: �� collaborative technologies; �� e-collaboration; �� innovation; �� SMEs

Introduction Emerging powerful Information Technologies (ITs), such as the Intranet, allow people to collaborate and share their complementary knowledge (Bhatt,

Gupta, & Kitchens, 2005). These technologies are responsible for e-collaboration, which can be defined as the collaboration among individuals engaged in a common task using electronic

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34 International Journal of e-Collaboration, 4(4), 33-50, October-December 2008

technologies (Dasgupta, Granger, & McGarry, 2002). As an intranet evolves, it increases in sophistication and complexity and can be used for advanced applications such as collaborative design, concurrent engineering, and workflow support (Duane & Finnegan, 2003). Thus, intranets are diverse and can integrate different collaborative technologies (CTs). CTs can be oriented to different, but compatible, uses. These are related to the offering of information online, communications and information exchange, and the automation of internal business processes. Hamel (2002) emphasizes the role of IT as an enabler of product and process innovation. Innovation process requires the support of CTs since they help in the efficient storage and retrieval of codified knowledge (Adamides & Karacapilidis, 2006), get different people together to innovate (Bafoutsou & Mentzas, 2002), enable the formation of virtual teams to execute the innovation process (Adamides & Karacapilidis, 2006; Kessler, 2003), and create an organizational climate favourable to product innovation. Thus, e-collaboration is expected to have a positive impact on firm innovation. The reverse direction of causality could exist as well, that is, causality may flow also from innovation to CTs’ adoption. However, this article focuses on analyzing the impact of CTs on innovation. Computer systems cannot improve organizational performance if they are not used (Davis, Bagozzi, & Warshaw, 1989). Recently, Devaraj and Kohli

(2003) showed that actual use may be an important link to IT value. Thus, we need to view CTs’ impact on innovation as a multistage process that starts at adoption and extends to use. Since knowledge will not necessarily circulate freely firm-wide just because accurate IT to support such circulation is available (Brown & Duguid, 2000), actual CTs’ utilization may be a critical phase. In an attempt to address this issue, this research examines the effect of CTs on innovation not only directly, the simple presence of CTs, but also based on actual CTs’ use. In this regard, this study will explore the direct relationship between CTs’ adoption and innovation, as well as the indirect relationship from CTs’ adoption, through CTs’ use, to innovation. The article consists of six sections and is structured as follows. The next section offers a classification of CTs and a framework differentiating three CTs’ uses. In the third section, the theoretical model is proposed and hypotheses are stated. Following that, the methodology used for sample selection and data collection is discussed. Then, data analysis and results are examined. Finally, the article ends with a discussion of research findings and concluding remarks. LITERATURE REVIEW Collaborative Technologies CTs are applications where ITs are used to help people coordinate their work with others by sharing information or knowledge (Doll & Deng, 2001). They



are critical in KM programs (Alavi & Leidner, 2001; Marwick, 2001; Skyrme, 1998). Different technologies are used in e-collaborations (Dasgupta et al., 2002). A review of the literature reveals several CTs’ classifications. DeSanctis and Gallupe (1987) discuss a taxonomy based on group size (smaller, larger) and task type (planning, creativity, intellective, preference, cognitive, conflict, mixed motive). According to Pinsonneault and Kraemer (1990), there are two categories of group support systems: group decision support systems and group communication support systems. Ellis, Gibbs, and Rein (1991) describe a taxonomy based on application-functionality and Coleman (1995) also provides twelve categories of CTs in the same domain. Mentzas (1993) classifies CTs’ software based on four major criteria: coordination model characteristics, type of processing, decision support issues, and organizational environment. This study focuses on a classification of CTs based on the work of Nunamaker, Briggs, Mittleman, Vogel, and Balthazard (1997), DeSanctis and

Gallupe (1987) and Pinsonneault and Kraemer (1990). In this sense, Table 1 shows that CTs may be grouped into two types of systems: (1) electronic communication systems (ECS), whose purpose is to facilitate information exchange; and (2) teamwork systems (TS), where teamwork (processes and decision-making) is structured and done. ECS aim at enabling relationships among individuals or institutions, employees or customers, while TS’ objective is to integrate information and predefined work processes, as is the case with workflow tools. According to the expected frequency of use, the present study considers four CTs (two for each category), namely, discussion forums, repositories, shared databases, and document management systems/workflows. Discussion forums: Due to their simplicity, discussion forums have been one of the earliest technologies for collaborative knowledge creation and knowledge sharing (Wagner & Bolloju, 2005). The subject is set and the discussion is carried on, either with all participants online, or over

Table 1. Collaborative technologies classification Electronic communication systems (ECS)

Teamwork systems (TS)

Concept

They support the exchange of information, documents, and opinions.

Work is done through them.

Aim

Relationship

Integration

Email; Discussion forums; Repositories;

Workflows/ Document management systems; Project management; Shared databases;

Tools

Yellow pages (experts directories)

Group decision support systems



time, where anyone can share his or her opinion at any time (Bafoutsou & Mentzas, 2002). Repositories: Valuable knowledge can be collected and placed into repositories for use by others (Gunnlaugsdottir, 2003). Document repositories are a collection of relevant documents that list tacit and articulated knowledge from the experts about the project using textual, picture, and diagrammatic forms (Fernandes, Raja, & Austin, 2005). Shared databases: They are databases whose data may be consulted and modified by different authorized users within a company or a team. Shared databases are necessary to reduce or prevent the repeated typing of data, but in addition they supplement the system with a wealth of update information, thus building the organizational memory (Gunnlaugsdottir, 2003). Document management systems/ workflows: Document management systems handle documents, storing them in a central server where users can access and work on them. Occasionally, there is a possibility for version control, search, electronic signing, and access control (Bafoutsou & Mentzas, 2002). Workflows may be defined as the automation of a business process, in whole or part, during which documents, information, or tasks are passed from one participant to another for action, according to a set of procedural rules (WFMC, 2004). Thus, regarding process automation, workflows seem to be more advanced than document management systems.

Collaborative Technologies’ Use Firms can use CTs for different purposes. Soto-Acosta and Meroño-Cerdan (2006) identified three Website orientations: e-information, e-communication, and e-transaction. Based on this classification, three CTs’ use orientations have been identified: e-information, e-communication, and e-workflow. E-information: CTs can be used as a corporate channel for information dissemination and data access across functional boundaries and organizational levels. As a result, CTs may reduce the cost and effort associated with corporate information searches. Thus, e-information is considered as the use of CTs to provide one-way company electronic information. E-communication: CTs, besides allowing cost reduction in comparison to traditional communication tools, offer a unique and integrated opportunity for interacting with several business agents (both internal and external to the organization). In this way, these technologies facilitate the exchange of information, collaboration, and the possibility of establishing close relationships based on trust and mutual commitment. Thus, e-communication is considered as the use of CTs for two-way information exchange. E-workflow: In the new economy, work has shifted from the creation of tangible goods to the flow of information through the value chain (Basu & Kumar, 2002). The establishment and development of workflow processes has played



a fundamental role in this transition. CTs provide great opportunity for automation of processes and workgroup. Thus, e-workflow is considered as the use of CTs for the establishment of predefined electronic processes through CTs. Model As mentioned in the introduction, the present study focuses on analyzing the impact of CTs on firm innovation. This effect is evaluated directly from the simple presence of IT, but also according to CTs’ actual use. In addition, the relationship between adoption and use of CTs is examined in order to specify the indirect relationship of CTs’ adoption and innovation through CTs’ use. Collaborative Technologies’ Adoption and Innovation Innovation can be defined as the search for, the discovery, and the development of new technologies, new products and/or services, new processes, and new organizational structures (Carneiro, 2000). It is the implementation of new

ideas generated within the organization (Borghini, 2005; Gurteen, 1998). IT is considered a key facilitator of innovation. Many researchers are focused on analysis of how the Web will change innovation within and between companies (Sawhney & Prandelli, 2000). CTs are Web-based tools that allow information and knowledge exchange (electronic communication systems), as well as work execution by integrating information, documents, and employees (teamwork systems). Thus, intranets and other CTs can be used to distribute and share individual experience and innovation throughout the organization (Bhatt et al., 2005) and offer the chance of applying knowledge for the creation of new products. Also, users and partners from remote places may need to participate in the innovation process. This further emphasizes the instrumental role of IT as enabler for the formation of virtual teams to execute the innovation process (Adamides & Karacapilidis, 2006; Kessler, 2003). In summary, the benefits from Web

Figure 1. Research model collaborative technologies adoption • D iscu ssio n fo rum s • D o cu m e n t r e p o sito rie s • S h a re d d a ta b a se s • D o cu m e n t m a na g em en t/w o rkflow

H1

H2

Innovation • P ro d u ct • P ro ce ss

H3 collaborative technologies use • E -in fo rm a tion • E -co m m u n ica tio n • E -w o rkflo w



collaboration, which include efficient information and knowledge sharing as well as working with no distance limitations, are expected to be positively related to the introduction of process and product innovations. Thus, the following hypothesis is proposed:

and more diverse set of information resources, and also offer an enhanced opportunity for information exchange and communication (DeSanctis, Fayard, Roach, & Jiang, 2003; Walsham, 2001). Repositories store documents (Kwan & Balasubramanian, 2003) and information (Ackerman, 1998), faciliHypothesis 1: CTs’ adoption is posi� tating access to stored knowledge from tively related to innovation: experts (Fernandes et al., 2005). In the case of CTs labelled as TS, both shared H1a: The adoption of discussion forums databases and document management is positively related to innovation; systems/workflows are expected to support information and workflow roles. H1b: The adoption of repositories is Shared databases include any data and positively related to innovation; information stored in the business, and make it available to third parties so that H1c: The adoption of shared databases is they can make decisions and process positively related to innovation; and their transactions (Shah & Murtaza, 2005). Workflow technologies are H1d: The adoption of document man� natural repositories for organizational agement systems is positively related memory (Zhao, Kumar, & Stohr, 2000) to innovation. and allow the inspection of information about the current status of the process Collaborative Technologies’ of innovation (Chung, Cheung, Stader, Adoption and Collaborative Jarvis, Moore, & Macintosh, 2003), as Technologies’ Use well as the automation of processes Distinct CTs are expected to be more and transactions. Thus, the following suitable for different purposes. How- hypothesis is formulated: ever, all those technologies provide information that can be accessed by Hypothesis 2: Distinct CTs are expected employees. Discussion forums, al- to be associated to different uses: though intended to be convenient for e-communication (Hayes & Walsham, H2a: ECS are positively associated with 2001; Rubenstein-Montano, Liebow- e-information and e-communication itz, Buchwalter, McCaw, Newman, uses; and Rebeck, & The Knowledge Management Methodology Team, 2001), can H2b: TS are positively associated with be also used as an information tool, e-information and e-workflow uses. since online forums afford a larger Copyright © 2008, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited.


Collaborative Technologies’ Use and Innovation The presence of ITs does not guarantee any effect on performance if they are not used (Davis et al., 1989; Forgionee & Kohli, 1996). Since knowledge will not necessarily circulate freely firmwide just because accurate information technology to support such circulation is available (Brown & Duguid, 2000), actual CTs’ utilization may be a critical phase. Thus, this research considers CTs’ impact on innovation as a multistage process that starts at adoption and extends to use. That is, this study, besides testing the direct relationship between CTs’ presence and innovation, also examines the influence of actual CTs’ use on innovation. Actual CTs’ use is expected to have a positive impact on innovation. CTs’ use is measured according to three orientations: e-information, e-communication, and e-workflow.

Methodology The organizations selected for this study are SMEs (small- and medium-sized enterprises) from Spain. SMEs were considered because of their importance for economic growth, employment, and wealth creation in economies both large and small. Currently, SMEs represent around 99% of the total number of firms in Spain (INE, 2005). SMEs are characterized by having fewer financial, technological, and personnel resources than their higher-level counterparts (large firms). Nonetheless, to ensure a minimum firm complexity in which CTs may be relevant, only firms with at least 10 employees were used.

Sample and Data Collection The target population consisted of SMEs from the Region of Murcia (Spain), with at least 10 employees. Three hundred and ten valid responses were obtained from different industries. The study assumed an error of 5.4% for p=q=50 and a Hypothesis 3: There is a positive confidence level of 95.5%. A structured relationship between CTs’ use and in� questionnaire consisting of close-ended novation: questions was developed. Face-to-face surveys with the key informant person H3a: There is a positive relationship be� in each company were conducted in tween e-information and innovation; May, 2005. The studied companies are mainly SMEs, and most of the interH3b: There is a positive relationship viewees were CEOs. Table 2 shows the between e-communication and innova� characteristics of the sample. tion; and Measures of Variables H3c: There is a positive relationship This section describes the variables used between e-workflow and innovation. for measuring the presence of CTs, CTs’ use, and innovation. The formulation



Table 2. Sample characteristics (N = 310) Business Industry

%

#

Textile

12.6

39

Food and Agriculture

40.0

124

ICTs

1.6

5

Services to businesses

15.2

Retail Others

%

#

Managing director, CEO

58.4

181

Human resources manager

8.7

27

Business operations manager

5.2

16

47

Administration/Finance manager

23.5

73

17.7

55

Others

4.2

13

12.9

40

%

#

10-49

71.3

221

50-249

24.5

76

More than 249

4.2

13

Number of employees

Respondent title

and criteria for answering the questionnaire is defined in the Appendix. Collaborative technologies: Using a dichotomous scale, CEOs assessed the presence of four tools in their firms: discussion forums, shared databases, repositories, and document management systems/workflows. Collaborative technologies’ use: One item (five-point Likert-type scale) was used for measuring each collaborative technology use. Firms were requested to value their CTs’ degree of use in order to inform their employees (e-information), to debate or receive employees’ suggestions (e-communication), and to support the automation of internal business processes (e-workflow). Innovation: Two items based on Choi and Lee’s (2003) research were developed, distinguishing the firm’s situation re new products and new processes with respect to the industry average. That distinction is based on

previous literature, such as Damanpour and Gopalakrishnan (2001) who found differences in companies when adopting product versus process innovations. Analyses and Results With regard to CTs, 37.1% out of all analyzed firms (310) had at least one type of CT within their intranet. Table 3 shows detailed results. Shared databases were the most frequently-found technology, with 34.2% of the total number of firms containing it. This technology was also found in almost all firms that had at least one type of CT (92.2%). The second and third technologies in importance were document repositories and document management systems/workflows, respectively. Less than 10% of all analyzed companies presented discussion forums, while 25.2% of firms containing at least one CT had them. Descriptive statistics and bivariate correlation coefficients are presented in Table 4. Although significant cor-



relations among many of the variables 5) showed that, although statistically were found, to test casual relationships, significant coefficients were not found regression analysis was used. for any CT, CTs’ adoption was associated with innovation. When doing the Collaborative Technologies’ analysis by the stepwise procedure, it Adoption and Innovation was found that shared databases were Analysed firms claimed to innovate positively associated with product inslightly above the industry average. novation (supporting H1c) and docuAlso, the degree of product innovation ment management systems/workflows and process innovation were very simi- were positively related to process inlar, with 3.2 and 3.3, respectively. As novation (supporting H1d). Thus, H1 presented in Table 4, all CTs, except for is partially supported; only TS (shared the discussion forums, had significant databases and document management correlations with both types of inno- systems/workflows) were found to be vation. Regression results (see Table associated with innovation.

Table 3. Presence of collaborative technologies Total %

At least one CT%

(n=310)

(n=115)

Discussion forums

9.4%

25.2%

Repositories

21.9%

59.1%

Shared databases

34.2%

92.2%

Document management systems/ Workflows

21.3%

57.4%

Collaborative technology

Table 4. Descriptive statistics and bivariate correlation coefficients Mean

S.D.

Correlation

1. Discussion forums

0.09

0.29

1

2. Shared databases

0.34

0.47

0.39***

1

3. Document repositories

0.22

0.41

0.44***

0.65***

1

4. Document management systems/Workflows

0.21

0.41

0.42***

0.63***

0.69***

1

5. E-information

2.96

1.57

0.30***

0.18*

0.26**

0.34***

1

6. E-communication

2.47

1.41

0.36***

0.13

0.18*

0.23**

0.79***

1

7. E-workflow

4.07

1.14

0.04

0.37***

0.15

0.19*

0.13

0.04

1

8. Product innovation

3.24

1.01

0.05

0.14**

0.13**

0.13**

0.24**

0.15

0.08

1

9. Process innovation

3.34

0.98

0.04

0.16***

0.13**

0.16***

0.28***

0.19*

0.05

0.68***

Variables

1

2

3

4

5

6

7

8

p