The Level of EC Utilization and its Impact on Firm Performance in SMEs

This study sought to explore how SMEs are utilizing EC. Drawing on existing research on IT and EC related field, this study presented the framework of EC utilization level and analyzed its affecting factors in the point of organizational perspectives; strategy and competency. The impact of EC utilization on firm performance was also examined by employing BSC. Structural equation model was applied to test the relationships among the theoretical constructs with data from 171 SMEs. The results showed that the rate of EC utilization in SMEs is growing quite rapidly. However, manufacturing related firms still remain at a lower level compared to service related firms. As for the two affecting factors of EC utilization level, it was found that the level of EC utilization appeared to be driven not by strategy but by competency. This result implicates that EC utilization in SMEs doesn't reach to strategic purpose yet, while it is dependent on firm's competency. As far as the impact of EC utilization on firm performance, the study showed that the level of EC utilization has significant relationship with all perspectives performance indicators of BSC. This study can provide the managers with current EC utilization pattern and the guidelines as to where to put the efforts in the EC utilization and how to get an effective EC utilization strategy in the future.