The effect of environmental uncertainty on B2B-platform switching decisions: An empirical study on Hong Kong SMEs

Context: SMEs make up the major share of the manufacturing and trading industry in Hong Kong. Recently, the industry is faced with growing environmental uncertainty that may result in new challenges, consequently giving rise to a different set of needs concerning B2B relationships. These needs may present opportunities for alternative B2B platforms to further reduce friction in SME trade. Therefore, from the perspective of platform providers, it is valuable to assess what factors drive SMEs likeliness of using alternative platforms. Objective: This study extends existing research on IT switching behaviour by linking it to organisational innovation theory. According to extant literature, environmental uncertainty may lead to increased innovativeness and adaptability in organisations. The aim is to assess how perceived environmental uncertainty affects the propensity to switch in the context of B2B platform technologies. Method: A research model was developed by adapting the Push-pull -mooring model. It was extended with context-specific antecedents. The model was empirically tested with PLS-SEM using 68 responses from a survey with managers of Hong Kong SMEs. Results: We find that switching propensity is directly predicted by pull (attractiveness of alternatives), push (satisfaction with incumbent) and mooring (perceived switching cost) factors. Further, perceived network size is found to influence switching propensity mediated by satisfaction. Environmental uncertainty is found to positively affect the attractiveness of alternatives and top management innovativeness. Conclusion: The results have several managerial implications. Since attractiveness of alternatives was found to have the largest effect, managers may be advised to focus on differentiating their offerings from incumbent products. Further, the results suggest that within-group effects play a role for platform switching. More research is needed to further explore this hypothesis.Management of Technology (MoT