Cloud adoption in Indian SMEs – an empirical analysis

Purpose This study aims to empirically validate the determinants of cloud adoption in small and medium enterprises (SMEs) in India and examine its impact on their economic performance. Design/methodology/approach An integrated theoretical model interplaying technological, organizational and environmental aspects were applied for analyzing the variation in factors. Using data from 317 Indian SMEs, we have applied confirmatory factor analysis and structural equation modeling to test the hypotheses. Findings The results demonstrated that perceived usefulness, perceived ease of use, technology readiness, top management support and trust were the influencing drivers of cloud adoption in SMEs in India. Compared to previous studies, we did not find compatibility and competitive pressure as significant, suggesting that there was no single set of factors influencing technology adoption. Economic performance achieved by reduced transaction costs formed the basis of favorable adoption. Research limitations/implications The integrated model can provide space for new dimensions based on the category and geography of the SMEs. The paper does not address the supply-chain perspective of cloud adoption. Practical implications The study directs the firm owners to visualize business logic by creating a digital ecosystem. Further, the model guides the stakeholders, including cloud service providers, to contribute to the economic proficiency of the SMEs. Originality/value The paper empirically validates a model integrating both the drivers and consequences of cloud computing adoption as a unique study. Findings indicate that the usage of metrics such as return on investment and system efficiency form a part of the technology system approach.