Emerging B2B electronic marketplaces : explaining organizational participation with transaction cost perspective

With the growing popularity of B2B e-marketplaces, increasing numbers of organizations are endeavouring to utilize this medium in their business activities. However, the present knowledge regarding B2B e-marketplace adoption processes is still limited. Therefore, the present study investigates circumstances under which organizations adopt B2B e-marketplaces. More specifically, it is primarily concerned with the factors motivating an organization's participation in B2B e-marketplaces from the purchasing manager's perspective, based on insights and observations obtained from transaction cost economics. A single unified framework was developed based on previous findings to investigate the emergence of efficiency motive within organizations, and to analyze the role of this motivation in organizational participation processes. A large-scale cross-sectional survey study targeted the membership of the Purchasing Management Association of Canada (PMAC) was used for empirical validation of this framework. Partial Least Squares (PLS) analysis was chosen to test the measurement model and the conceptual model based on 466 usable responses obtained. The results demonstrate that efficiency motive exerts a significant influence on intentions to adopt B2B e-marketplaces, and reveal three transaction characteristics that significantly contribute to the formulation of efficiency motive: frequency uncertainty of demand, asset specificity, and market fragmentation.Business, Sauder School ofManagement Information Systems, Division ofGraduat