Business–IT fit in e-procurement systems: evidence from high-technology firms in China

Abstract

Because of the influence of globalization and updated information technologies (IT), firms in China face an urgent need to adopt e-procurement systems (EP) to deal with their daily procurement activities. However, implementing EP in China encounters various uncertainties from internal and external business environments. To address this issue, this research aims to examine the fit between business and the IT environment and to study its impact on system performance. The literature review allows the proposal of two internal business environmental uncertainties and two external business environmental uncertainties covering the perspectives of process, knowledge, partnership and environment. Based on a multiple-case study performed in four Chinese firms that supply various personal computer components to a Taiwanese original equipment manufacturer via an EP, it was found that the firms’ external and internal uncertainty factors affected the performance of EP. In addition, an EP with a low level of integration – the EP type used most frequently in China – can only achieve great performance when the adopting firms faced a low uncertainty of environment, partnership and process, and had low levels of IT knowledge. It was also observed that lack of fit between the business environment and EP produced extra burdens and costs in the buyer–supplier relationship. This significantly reduced the system performance of the Chinese firms. Hence, the contribution of this research can be twofold. First, practitioners in China can use this framework to diagnose their environmental conditions and then choose the appropriate type of EP to implement. Second, researchers can build upon this model to further examine the impact of fit on EP performance and generalize the results.