Factors affecting adoption of digital business : evidence from Australia

Small and medium-size enterprises are a significant part of the Australian economy. Understanding how Small and medium-size enterprises can effectively adopt digital strategies to facilitate their growth will have positive implications for the national economy. Research has found that Small and medium-size enterprises with a high level of digital engagement are more profitable, survive longer and grow larger (Deloitte Access Economics, 2013). However, a recent research survey shows only 16% of Australian Small and medium-size enterprises with a high level of digital engagement and the vast majority of Small and medium-size enterprises are not fully engaging with digital strategies (Deloitte Access Economics, 2013). Small businesses are at risk of missing opportunities that the digital economy opens up. While there are considerable studies on small business going online in the research literature, few studies have focused on the adoption of digital business in Greater Western Sydney. This paper attempts to address this lack by examining the level of digital engagement in Small and medium-size enterprises in Greater Western Sydney using a qualitative approach. This research analyses and identifies factors affecting adoption of digital business in Small and medium-size enterprises. The findings of this research suggest that the current state of local digital businesses in Greater Western Sydney can be best viewed as little more than using emails or providing basic information and services online. The factors affecting digital business adoption include lack of understanding of relevance of digital business to their organisations, absence of digital strategies, lack of skills and perceived cost and risk of change. Most local small businesses in Greater Western Sydney appear to be slow to advance their efforts to engage in the digital economy. This research recommends that Small and medium-size enterprises in Greater Western Sydney need a proactive approach to developing effective digital strategies.