Context, User Perception and Adoption Level of Cloud Computing Among Small and Medium Enterprises in Nairobi County, Kenya

Abstract

Cloud computing offers a new way for strategic adaptation to change in business and supports efficiency in marketing of products by offering ready-to consume cloud-based Information Technology (IT) services. A review of existing studies revealed that scholars share divergent views on adoption of cloud computing. This study sought to establish the mediating effect of user perception on the relationship between Technological, Organizational and Environmental (TOE) contexts and adoption level of cloud computing by small and medium enterprises in Nairobi city, Kenya. The main objective of the study was to examine the effect of context user perception on adoption of cloud computing among small and medium enterprises in Nairobi County, Kenya. The specific objectives of the study were to determine the; relationship between technology context, organisational context, environmental context and cloud computing adoption, and the mediating effect of user perception on the relationship between technology context, organisational context, environmental context and cloud computing adoption. The Innovation Diffusion Theory and the theory of planned behaviour provided a theoretical basis for the study. The study adopted explanatory research design. It employed cluster sampling to identify participants from the target population of 82,821 registered Small Medium Enterprises in various industries within Nairobi County. Random sampling was used to select a manager, an IT manager or entrepreneur from each small medium enterprise who comprised as the main respondents for this study. A structured questionnaire was used to collect data with items anchored on a five- point Like scale. Data was analysed using Multiple Regression Model, descriptive and inferential analysis. Construct validity and reliability was achieved by calculating the Cronbach’s alpha. The study found that Technological, Organizational, Environmental contexts (TOE) mediated by user perception comprised the key determinants of cloud computing adoption among SMEs. The study further established that technological context had a positive and significant effect on the level of adoption of cloud computing (β1= 0.414, ρ<0.05), and organization context (β2= 0.262, ρ<0.05) had a positive and significant effect on the level of adoption of cloud computing. However, environmental context had no significant effect on the level of adoption of cloud computing (β3= - 0.033, ρ>0.05). In addition, the study indicated R2 with a value 0.418.Therefore, (TOE) explained 41.8% variation of cloud computing adoption. User perception significantly and partially mediated the relationship between technology context and cloud computing adoption (z-value 3.588, p=0.0003). Further testing indicated a significant partial mediation of user perception on the relationship between organization context and cloud computing adoption (z=2.267, p=0.0234). Similarly, there was a significant partial mediation of user perception on the relationship between environmental context and adoption of cloud computing (z=4.500, p=0.000. The study concludes that SMEs are more inclined to adopt a technology perceived to be useful and easy to use. The new knowledge that emerged from this study is the mediating effect of user perception on the determinants of cloud computing adoption. Therefore, study contributes to theory by developing a model that relates the user perception of TOE context and cloud computing adoption. The main implication is that the study provides valuable reference for researchers, service providers in formulating better strategies, and enabling SME managers to effectively deliver services on cloud computing. The study recommends that small medium enterprises should undertake a deliberate policy to adopt innovations perceived to be useful and easy to use and are cost effective to enhance them to compete at a level playing field with the large organisations.