Editorial for the Special ECIME Edition of EJISE-ECIME2013 The Adoption of Cloud Computing by Irish SMEs-an Exploratory Study

Marian Carcary, Eileen Doherty, Gerard Conway
Cloud Computing adoption has experienced a considerable rate of growth since its emergence in 2006. By 2011, it had become the top technology priority for organizations worldwide and according to some leading industry reports the cloud computing market is estimated to reach $241 billion by 2020. Reasons for adoption are multi-fold, including for example the expected realisation of benefits pertaining to cost reduction, improved scalability, improved resource utilization, worker mobility and
more » ... er mobility and collaboration, and business continuity, among others. Research into cloud computing adoption has to date primarily focused on the larger, multinational enterprises. However, one key area where cloud computing is expected to hold considerable promise is for the Small and Medium Sized Enterprise (SME). SMEs are recognized as being inherently different from their large firm counterparts, not least from a resource constraint perspective and for this reason, cloud computing is reported to offer significant benefits for SMEs through, for example, facilitating a reduction in the financial burden associated with new technology adoption. This paper reports findings from a recent exploratory study into Cloud Computing adoption among Irish SMEs. Despite its purported importance, this study found that almost half of the respondents had not migrated any services or processes to the cloud environment. Further, with respect to those who had transitioned to the cloud, the data suggests that many of these SMEs did not rigorously assess their readiness for adopting cloud computing technology or did not adopt in-depth approaches for managing their engagement with cloud. While the study is of an exploratory nature, nevertheless the findings have important implications for the development/ improvement of national strategies or policies to support the successful adoption of Cloud Computing technology among the SME market. This research has implications for academic research in this area as well as proposing a number of practical recommendations to support the SME cloud adoption journey. enterprises (Street and Meister, 2004). Such differentiating characteristics include for example more limited human resources with lower levels of specialized skills and less formal training; more limited financial resources, revenue generating ability and available budgets; greater dependency on third parties for service delivery and increased propensity for outsourcing; simpler command structures; lower levels of bureaucracy and formality in processes/procedures; and greater agility and more rapid decision-making processes (Pemmaraju, 2010; Street and Meister, 2004). Given, Cloud Computing's ability to support increased capacity or extended firms capabilities, without incurring extra costs which would have historically necessitated investment in infrastructure, software or staff training, it can be inferred that this technological platform may hold several opportunities for SMEs (Aljabre, 2012). However this emerging trend needs to be further researched from the SME perspective. For example, one key area of interest in the degree of preparation SMEs undertake when migrating services or processes to the cloud, as previous technology adoption studies have found that those SMEs who have a higher degree of organizational readiness are more likely to experience higher benefit realisation (Iacovou et al, 1995). A further area of interest, given the benefit potential offered by this technological platform, is the constraints preventing SME cloud adoption. SMEs are an important and integral component of every country; they form a cornerstone of the EU economy, representing 99% of all enterprises (European Commission, 2012) and in 2012 were estimated to account for 67 percent of total employment and 58 percent of gross value added (Ecorys, 2012). In the Republic of Ireland SMEs represent 98% of all companies employing less than 50 people, and constitute approximately 60% of the overall workforce (Central Statistics Office, 2008). Given the pivotal role SMEs play in the economy, ensuring that they have a firm understanding of issues associated with cloud computing adoption is critical. This paper presents results of an exploratory study into cloud computing adoption in the Irish SME context. The structure of this paper is as follows: Section two outlines the methodological approach taken. Section three outlines survey findings. A profile of survey respondents, and a profile of cloud adopters and nonadopters are provided in sections 3.1 and 3.2 respectively. For those SMEs who have adopted Cloud Computing, the paper examines the steps those organizations have taken to prepare for migration to the cloud environment (section 3.3). For those SMEs who have not taken steps towards adopting Cloud, the paper examines the reasons behind this non-adoption (section 3.4). Understanding the implications of these findings results in the development of a set of recommendations or policy steps that should be addressed at a national level to promote and support the SME cloud adoption journey (section 4). Section five draws a conclusion to the paper. Methodology This study employed a quantitative research approach through utilization of an online survey instrument (questionnaire). The online questionnaire is increasingly recognized as an invaluable means of data collection (Doherty, 2012) due to such benefits as higher response speed (Adams and Deans, 2000); lower respondent error (Weible and Wallace, 1998); and removal of interviewer bias (Van Selm and Jankowski, 2006). In developing questionnaire constructs, a detailed review of existing literature which focuses on reasons for technology adoption/non adoption, as well as readiness for technology adoption was undertaken. This literature helped to frame the questionnaire's constructs -these constructs were then pilot tested with a sample of 20 SME owner/managers and senior academic researchers, and refined to ensure relevance and comprehension in the SME environment. The questionnaire gathered responses using 5-point Likert scales. A numerical score was associated with each response and this reflected the degree of attitudinal favourableness, with 'strongly disagree' associated with number '1' on the scale and 'strongly agree' associated with number '5'. The survey also consisted of a combination of open-ended and closed questions. The small number of open ended questions invited free comments where it was not always possible to predict the range of responses to a particular question (Frary, 1996). The use of closed questions served to generate and gather information quickly by the researcher (Boynton and Greenhalgh, 2004).