Factors affecting organizational technology innovation adoption: an interview-based study on retailers’ self-service check-out adoption in Finland

Abstract

Retailing has faced turbulence during the past years due to the advances in IT and changes in customer behaviour. Consequently, retailers in many Western countries have introduced an increasing amount of self-service checkouts (SSC) to offer the customers with alternative service models and to enhance operational efficiency. SSCs are point of sale technologies enabling customers to co-produce a service without employee interaction. It remains un-clear why Finnish retail sector falls behind in SSC adoption if compared to the leading coun-tries of SSC retail adoption. This study aims to find out possible drivers and restricting fac-tors of retailers’ SSC adoption in Finland by applying a technology-organization-environ-ment (TOE) framework. A company-centric perspective is applied.

The primary data set was collected through nine qualitative semi-structured thematic in-terviews. Six Finnish retail companies were selected for interviews based on theoretical sampling. To create a holistic picture of the determinants of SSC adoption, both adopter and non-adopter companies from grocery and specialty retailing were included. The inter-viewees were key employees closely involved in decision making concerning SSC adoption. The primary data was analyzed with abductive content analysis. The secondary data set consists of public documents, mainly newspaper articles and press releases regarding re-tailers’ SSC adoption in Finland and in the leading SSC adoption countries. The secondary data was used for validating the research question and describing the research context.

The findings indicate that during the first wave of SSCs (ca. 1997-2012) Finnish retailers’ adoption was slow e.g. due to weak customer readiness, technology flaws, poor user expe-rience, and regulation of selling age-restricted products. Firms were not tempted to adopt, as it seems that the benefits did not exceed the efforts. During the second wave (ca. 2012 and onwards), the barriers have reduced as customers are more familiar with technologies and the SSC technology itself is more advanced. User experience design has improved and managers recognize the strategic potential of new technologies. The first mover’s role in familiarizing customers with the technology is crucial and makes adoption less risky to the late adopters. These dynamics are likely to explain why Finnish retailers have begun to adopt SSCs more intensively just recently.

The findings contribute to the organizational innovation adoption literature by showing that firms’ technological, organizational, and environmental context impact its technology innovation adoption decisions in the studied context. In this study, a TOE-based model of firms’ SSC adoption was developed and explored. The findings did not support the frame-work entirely. Hence, the theory is still evolving and calls for further research.