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The Impact of Technology on the Advancement of E-commerce in United Arab Emirates Small and Medium Enterprises

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The aim of this proposal is to evaluate the impact of technology on the advancement of e-commerce in United Arab Emirates (UAE) Small and Medium Enterprises (SME). The independent variable in the research is technology, moderating being firm size and dependent advancement of e-commerce. In chapter one, we have eight subsections namely 1.1 which will be the overview, 1.2 which will give background information of the independent variable and 1.3 which will also give background information about the dependent variable. 1.4 will break down the independent variable into specific objectives while 1.5 will have the hypotheses that will be tested. 1.6 will be interested in the boundaries that the study will set in terms of the scope. 1.7 will be aimed at discussing the contribution that the research will add to knowledge and 1.8 will be interested in the approach that the research will employ. Chapter two will dwell on three subcomponents: theoretical framework, empirical literature and conceptual framework. This research will be based on two theories that is Process Virtualization Theory (PVT) and Social Support Theory (SST). The empirical literature will be the most bulky part of this research and it will review related studies. The last part of chapter two will be the conceptual model.

Use of Technology

The survival of any business depends on the profitability of its products. These products have to be of the quantity and quality that appeases the consumers. In addition, this business needs to be efficient in how it produces the goods and services, how it repackages them, how it markets them and how it follows up on any customer complaints. This efficiency may mean one word: technology. A business needs to invest in technology to enhance its prosperity. Yiming, Jiming, and Alexandros (2001), observes that connectivity of the internet is changing many market dynamics and creating great opportunities for business. Technology has profoundly affected the business system as new means keep on being developed to boost the ways of getting through the cut throat competition (Mallia & Windels, 2011) and the society is increasingly replacing many physical mechanisms with virtual ones (Overby, 2008). The number of internet users all over the world has grown exponentially where it has been adopted for multiple applications such as e-governance, e-learning and e-commerce (Rofiq, 2012).

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There are various platforms in which a firm can use technology to grow its trade. These may include Artificial intelligence, Social Medias, online payment platforms and video marketing platforms. Artificial intelligence (AI) is the study of computations that make it possible to perceive, reason and act as a human being when you are not one (Rech & Althoff, 2004). This may entail the use of robots or computer systems. AI deals with modeling real world objects from real world business like processes, expert knowledge or process models. Most models are built on the Social Support Theory (SST). This theory is cognizant of the fact that the experience of a user in an online context is different to that of an offline context. In online, there is no actual human contact or sociability contrary to the offline context. Therefore, social technologies can influence the social perception since perception is based on acquired or perceived experience. Social support can be informational or emotional: how it is conducted will determine trust and likelihood that customers will buy the product. Through social support, members of online community are able to participate in different groups activities and support their members through social interactions on a given platform.

Social media marketing is using social media platforms such as Facebook, Whatsapp, Twitter, Instagram and Telegram to gain traffic for your products. (Overby, 2008) observes that traditional processes where friendships were established relied mainly on face to face interaction. Social networking sites, dating sites, and multiplayer online role-playing games foster relationships development without the need for physical interaction. Social aggregations that emerge from the Net when many people carry on discussions attached with human feelings form a virtual community (Jung et al., 2013): this online community is best demonstrated by social media platforms.

Individuals use technology when they are planning on holidays to review suitability of hotels. For instance, tourists planning to witness the annual wildebeest migration in Maasai Mara Kenya will review via internet the hotels available during that peak season. Similarly, those intending to visit Mecca for the annual Muslim pilgrimage will review hotels in Saudi Arabia via technology. Increase in social networking sites means growth of e-commerce (Hajli, 2013). Today e-commerce, thanks to social media, has opened up a new stream called social commerce where social media platforms are creating opportunities for business.

It was observed that firm size has an impact on advancement of e-commerce. Said and Azizan (2015), found that small and medium sized firms in hospitals were facing similar challenges and obstacles to other small businesses when establishing e-commerce website. It also showed that businesses increase in profitability and size when they implement e-commerce. A small firm will find it difficult to acquire e-commerce due to high cost of set up, though size has been found out to be an insignificant influence of e commerce adoption. Firm size is measured by the age of the firm, corporate status, cash flows, turnover and asset base of the firm (Chepngeno, 2017). Size will also enable easier access of expertise advice when need be. (Meroño-cerdan & Soto-acosta, 2005) observes that in the past use of technology was a preserve of large companies or highly innovative companies: this is not the case today.

E commerce, though widely used in developing, emerging and developed economies, has not reached its full potential (Papazafeiropoulou & Pouloudi, 2017). The government as a mediator ought to play a bigger role in ensuring that the full potential is reached. With exception of a few countries such as Denmark, Netherland and Singapore, the public sector is still way long way to go in the advancement of e-commerce. The government can play a role in fast tracking the adoption of e-commerce by the actions of its fiscal policies. (Neely, 2014) observes that e-governance is the use of technology to enhance the accessibility and delivery of government services. For instance the government can subsidize the tariffs of usage of technology, importation of technological equipment, reduction of taxes on the firms that embraces technology, and reducing of tariffs on imports related to technological advancement. Information technology has been a key element in success of e commerce and has brought new dimension of doing things in internet government (Neely, 2014).

Advancement of E commerce

E-commerce is a way of doing business relying exclusively on internet. Also known as electronic commerce, e-commerce has rapidly penetrated all over the world, developing countries included (Yoon, 2009). The Internet has consolidated itself as a very powerful platform that has changed the way of communication between sellers and buyers, and the way of doing business (Said & Azizan, 2015) Yiming et al., (2001), observes that e-commerce has been involved in traditional business settings such as comparison shopping, pricing, negotiation, auction and brokerage amongst others. In order for e commerce to thrive, there must be trust of sellers and trust of internet medium towards intentions to purchase (Rofiq, 2012).

E-commerce has advantages such as flexibility and efficiency but it also has disadvantages the major being fraud incidents that keep on increasing with its advancement (Rofiq, 2012). In order for e-commerce to advance, sellers are encouraged to have platforms that advance seller-buyer relationships. However, this will depend on the commitment of government agencies in enhancing its security. (Overby, 2008) notes that the process of e-commerce mainly involves two steps: the first is where the seller provides product descriptions via Web pages to assist in product evaluation. This page will have the quantity, quality, price, varieties, substitutes, usage and all these are intended to avoid the need of a physical point of interaction between the buyer and seller. The second step is handling payments via a Web-based check out process. When people form social media platforms e-commerce is likely to thrive. Sellers can take advantage of these platforms and market their services. Social commerce platforms that are used include recommendations and referrals, forums and communities and ratings and reviews (Hajli, 2013).

Research Aims

The aims for this proposal will be:

  1. To determine the impact of artificial intelligence on advancement of e-commerce
  2. To establish the effects of Social Media on advancement of e-commerce
  3. To assess the mediating effect of government involvement on advancement of e-commerce
  4. To determine the moderating effect of Firm size on success of e commerce

Research Hypotheses

This research will be guided by the following alternate hypotheses:

  1. Artificial intelligence has a great impact on advancement of e-commerce
  2. Social Media has a great impact on advancement of e-commerce
  3. Government participation have a great impact on advancement of e-commerce
  4. Firm size has a moderating effect on success of e commerce

Scope of the Study

This study will have two independent variables (Social Medias and artificial intelligence). It will have firm size as the moderating variable and government policies as the mediating variable. The dependent variable of this study will be the advancement of e-commerce. In terms of time frame, this study will be conducted within one month where descriptive research design will be used. The target population for this study will be small scale traders in Kenya. The stratified method of sampling will be used and the budget for this thesis will be around $1,000 with a standard deviation of $200. Data will be collected through the help of structured questionnaires.

In this digital age, for one to be a step ahead of competition, one must embrace e-commerce in addition to the traditional methods of doing business. E-commerce will mean that one will be able to reach customers out of the traditional business domain in addition to retaining those that one already have. This study will add value to business people who own Listed Firms in Kenya in Kenya as it will provide them with insights as to how they will be expected to conduct their businesses competitively. It will also add value to knowledge as future researchers will have areas on where to refer to. It will draw recommendations upon which future researchers can draw from.

Paradigm to be used in the Study

Positivism is a philosophical theory stating that certain (“positive”) knowledge is based on natural phenomena and their properties and relations. Thus, information derived from sensory experience, interpreted through reason and logic, forms the exclusive source of all certain knowledge. Qualitative research is the approach usually associated with the social constructivist paradigm which emphasises the socially constructed nature of reality. It is about recording, analysing and attempting to uncover the deeper meaning and significance of human behaviour and experience, including contradictory beliefs, behaviours and emotions. Researchers are interested in gaining a rich and complex understanding of people’s experience and not in obtaining information which can be generalized to other larger groups.

The approach adopted by qualitative researchers tends to be inductive which means that they develop a theory or look for a pattern of meaning on the basis of the data that they have collected. This involves a move from the specific to the general and is sometimes called a bottom-up approach. However, most research projects also involve a certain degree of deductive reasoning (see section on quantitative research for more details).

Qualitative researchers do not base their research on pre-determined hypotheses. Nevertheless, they clearly identify a problem or topic that they want to explore and may be guided by a theoretical lens – a kind of overarching theory which provides a framework for their investigation.

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