dessert at ion draft research report mbl (2) final

8/6/2019 Dessert at Ion Draft Research Report MBL (2) Final

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An Investigation into the Adoption of E Commerce at Premier Banking

Corporation

A Research Report

presented to the

Graduate School of Business Leadership

University of South Africa

In partial fulfilment of the

requirements for the

MASTERS DEGREE IN BUSINESS LEADERSHIP,

UNIVERSITY OF SOUTH AFRICA

by


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Precious Rachael Mbire

Student # 70994307

ACKNOWLEDGEMENTS

I am indebted to my fellow colleagues, workmates and managers at Premier Bank for

their support and contributions during the data collection exercise. In addition, I would

like to thank my family for all of their prayers, love and support they have provided me:

my mom Vongai, sisters Charity, Beulla and Moreblessing and my little niece Nattie, a

true source of joy. I am especially grateful to my supervisor Mr. B. Masiya for his

dedication and professionalism in guiding me through this project.

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ABSTRACT

This study investigates the level of adoption to e-commerce by Premier Banking

Corporation. (PBC)

The study was done using the literature survey method and the questionnaire. The

questionnaire was administered personally by the researcher leading to a 99% return

rate.

The major conclusion from this study is that the level of e-commerce at (PBC) is

relatively poor as evidenced by the lack of internet banking.

Recommendations drawn from this research are that (PBCs) senior management

should be committed to the establishment of a more effective information system and

invest substantially more in information technology to meet the demanding needs and

expectations of customers.

The study presents a further study to assess the effects of successful implementation

of e-commerce on the operations of PBC.

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ContentsPage

ABSTRACT ................................................................................................................................... 3

This study investigates the level of adoption to e-commerce by Premier Banking Corporation.

(PBC) .............................................................................................................................................. 3

Contents .......................................................................................................................................... 4

CHAPTER 1 INTRODUCTION AND RESEARCH PROBLEM ................................................ 6

1.1 BACKGROUND OF STUDY ............................................................................................7

1.2 PROBLEM STATEMENT ................................................................................................8

1.3 OBJECTIVES OF THE STUDY ......................................................................................8

1.4 STUDY PROPOSITION ....................................................................................................8

1.5 STATEMENT OF HYPOTHESIS ................................................................................... 8

1.6 SCOPE OF THE STUDY ..................................................................................................9

1.7 JUSTIFICATION OF THE STUDY ................................................................................9

1.8 ASSUMPTIONS OF THE STUDY ...................................................................................9

1.9 RESEARCH OUTLINE .................................................................................................... 9

CHAPTER 2 LITERATURE REVIEW ....................................................................................... 10

2.1 INTRODUCTION ............................................................................................................ 11

2.3 BANKING CONSUMER OPTIONS .............................................................................. 17

2.4 TYPES OF ONLINE BANKING ....................................................................................17

2.5 GLOBAL EMPIRICAL RESEARCH ON E COMMUNICATION ........................ 192.6 SUCCESS FACTORS IN E-COMMERCE .................................................................. 21

2.7 GETTING THE BUSINESS ON THE WEB ................................................................. 24

CHAPTER 3 METHODOLOGY ................................................................................................. 27

3.1 INTRODUCTION ............................................................................................................ 27

3.4 SAMPLING ....................................................................................................................... 29

3.5 DATA COLLECTION ..................................................................................................... 32

CHAPTER 4 RESEARCH FINDINGS AND DISCUSSION ..................................................... 40

4.1 INTRODUCTION ............................................................................................................ 40

4.2 RESPONSE RATE ........................................................................................................... 40

4.3 LENGTH WITH ORGANISATION .............................................................................. 40

4.4 UNDERSTANDING E-COMMERCE ........................................................................... 41

4.5 ELECTRONIC COMMUNICATION TECHNOLOGY USED AT PBC .................. 43

4.6 LEVEL OF E-COMMERCE AT PBC ...........................................................................44

4.7 E-COMMUNICATION PRODUCTS ............................................................................ 45

4.8 BENEFITS OF E-COMMUNICATION ........................................................................ 46

4.9 PROBLEMS OF E-COMMUNICATION ..................................................................... 46

4.10 SUCCEESFULL IMPLEMENTATION OF E-COMMERCE .................................. 47

4.11 E-COMMERCE SUITABILITY AT PBC ................................................................... 48

4.12 RESOURCES FOR E-COMMERCE ........................................................................... 49

4.13 CHALLENGES BEING FACED BY PBC DUE TO LACK OF E-COMMERCE . 49

4.14 CHAPTER CONCLUSION .......................................................................................... 50

5. CONCLUSIONS AND RECOMMENDATIONS ................................................................... 51

5.1 CONCLUSIONS ...............................................................................................................51

5.2 RECOMMENDATIONS OF THE STUDY ................................................................... 52

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5.3 AREA OF FURTHER STUDY ....................................................................................... 52

APPENDIX A COVERING LETTER ...................................................................................... 53

APPENDIX B- QUESTIONNAIRE ............................................................................................ 54

LIST OF REFERENCES .............................................................................................................. 59

List of figures

Figure 1 Length in organisation .................................................................................................... 40

Figure 2 level of e-commerce at ZSE ........................................................................................... 44

Figure3 Is e-commerce suitable for business at PBC? ................................................................. 48

Figure 4 Do you have adequate resources to adopt e-commerce? ................................................ 49

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List of tables

CHAPTER 1 INTRODUCTION AND RESEARCH PROBLEM

1.1 INTRODUCTION

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An analysis of how the adoption of ecommerce solutions can enhance the

performance of Premier Banking Corporation is the focus of this study. This has been

necessitated by the advent of the digital age, especially e communication that has

offered the financial services sector opportunities for reduced transaction costs,

improved customer service and enhancement of customer base.

1.1 BACKGROUND OF STUDY

Premier Banking Corporation is a wholly owned subsidiary of Premier Finance Group, a

Zimbabwean registered financial services group of companies. The Group comprises of

three wholly owned subsidiaries which are, Premier Asset Management, PremierBanking Corporation, (PBC) and Premier Capital Management. PBC is currently the

Groups foremost operating subsidiary, having led the companys entry into the

financial services sector in 2002 as Premier Discount Company Limited. The Discount

House was registered as a financial institution under the Banking Act in August 2002

and opened its doors to the public on 1 October 2002. Premier Discount Company

Limited converted to a merchant Bank in November 2004 and consequently changed

its name to Premier Banking Corporation. PBC is an integral part of a sophisticated

financial sector that consists of the Reserve Bank of Zimbabwe at the apex,

commercial banks, merchant banks, discount houses, finance houses and the

insurance sector.

PBC comprises of six client facing units namely, Agri-finance, Business Banking,

Financial Markets, Global Banking, Investment Banking and Personal Banking. The

bank is structured to best serve its target clientele and interacts with those clients

through a combination of physical and electronic channels that offer a spectrum of

banking services, from the basic vanilla products to customised solutions for its diverse

market.

Despite PBCs well established nature, the bank has not fully capitalized on the

technological advancements mostly on the area of e communication. The bulk of the

organisations business is carried over the counter physically and this has had far

reaching inconveniences to the market especially in todays fast paced technological

world where real time decisions ought to be made. This has ultimately constrained the

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growth of PBC and has also led to a decline in the number of corporate clients with fully

active transactional accounts with the bank.

1.2 PROBLEM STATEMENT

PBC has not fully embraced e commerce in its operations and this has been noted as

a major growth constraint of the organization. Instead of continuously investing more

resources in new technology, it seems the bank has somewhat relaxed after the initial

adoption of e commerce programmes. The bank provides a limited range of e

commerce products and as such clients have been negatively affected since one can

not make real time decisions. Furthermore, the bank seems to have failed to capitalise

on the benefits of the e commerce programs adopted.

1.3 OBJECTIVES OF THE STUDY

(i) To assess the level of e commerce at PBC

(ii) To identify operational constraints caused by the lack of e communication

at PBC.

(iii) To establish the benefits that have been realised by the bank through theadoption of e commerce solutions.

(iv) To analyse how the adoption of e commerce at PBC could facilitate smooth

business flow between the bank and its customers.

(v) To recommend ways in which PBC could enhance its operations through the

adoption of e commerce solutions

1.4 STUDY PROPOSITION

The study proposes that the adoption of e commerce at PBC can lead to the

organisations superior performance.

1.5 STATEMENT OF HYPOTHESIS

(i) Null Hypothesis

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There is no relationship between the implementation of e commerce solutions

at PBC and its performance. Enhanced performance of PBC is independent of

the adoption of the e commerce solutions.

(ii) Alternative Hypothesis

The implementation of e commerce solutions can enhance the performance of

PBC.

1.6 SCOPE OF THE STUDY

The study will be carried out mainly at PBC headquarters in Harare. This is so becauseof financial and time constraints as well as from the fact that most of the strategic

decisions are made and found at the headquarters. The study respondents shall be

staff and management at PBC head office and selected clients.

1.7 JUSTIFICATION OF THE STUDY

The study results and recommendations will serve to bridge the literature gap that

exists since the existing literature reveals little regarding the impact of e commerce in

Zimbabwes financial sector. Furthermore, uncertainty exists as to what extent e

commerce benefits financial institutions in a developing country like Zimbabwe. The

study results will also benefit researchers and consultants in this field with study

material. PBC will also benefit if it embraces the recommendations that will be made at

the end of this study.

1.8 ASSUMPTIONS OF THE STUDY

(i) The respondents will provide accurate and relevant information

(ii) The study will receive maximum co operation from the respondents.

(iii) The prevailing situation at PBC will prevail up until the end of the study.

(iv) Data collection instruments will have adequate reliability and validity.

1.9 RESEARCH OUTLINE

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2.1 INTRODUCTION

In this section, literature by different authorities on ecommerce will be reviewed.

The historical development of ecommerce, Business to Business (B2B) e

commerce, success factors and benefits of ecommerce will be discussed. This

section will form the basis on which study findings will be discussed and it provides

a link between this study and what other researchers and authors have found out in

relation to the research problem, through reviewing related literature. The main

thrust of this literature review is to highlight the relationship between variables in the

study and empirical evidence so as to provide basis for testing the hypotheses

postulated in the previous section and for advancing arguments. Literature review is

an essential element of research and according to Leedy (1982), the more one

knows about the investigations relevant to ones own study the more one can

approach the problem of interest in ones area of investigation.

2.2 HISTORICAL DEVELOPMENT OF ELECTRONIC COMMERCE

Kessler (2003) put forward that electronic commerce consists primarily of the

distributing, buying, selling, marketing, and servicing of products or services over

electronic systems such as the Internet and other computer networks. It can involve

electronic funds transfer, e-marketing, online marketing, online transaction processing,

electronic data interchange (EDI) and automated data collection systems. He adds that

it typically uses electronic communications technology such as the Internet, extranets,

e-mail, e-books, databases and electronic catalogues. This study proposition is going

to review how the adoption of such e commerce solutions can enhance the

performance of PBC.

The meaning of the term "electronic commerce" has changed over the last 30 years.

Originally, "electronic commerce" meant the facilitation of commercial transactions

electronically, usually using technology like Electronic Data Interchange (EDI) and

Electronic Funds Transfer (EFT), where both were introduced in the late 1970s, for

example, to send commercial documents like purchase orders orinvoices electronically

(Bach and Erber, 2001).

According to Alexander (2000) e-commerce is defined as the complete set of

processes that support commercial/business activities on a network. In the 1970s and

1980s, this would also have involved information analysis. The growth and acceptance

of credit cards, Automated Teller Machines (ATM) and telephone banking in the 1980s

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http://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Product_(business)http://en.wikipedia.org/wiki/Servicehttp://en.wikipedia.org/wiki/Computer_networkhttp://en.wikipedia.org/wiki/Electronic_funds_transferhttp://en.wikipedia.org/wiki/E-marketinghttp://en.wikipedia.org/wiki/Online_marketinghttp://en.wikipedia.org/wiki/Online_transaction_processinghttp://en.wikipedia.org/wiki/Electronic_data_interchangehttp://en.wikipedia.org/wiki/Internethttp://en.wikipedia.org/wiki/Extranethttp://en.wikipedia.org/wiki/E-mailhttp://en.wikipedia.org/wiki/E-bookhttp://en.wikipedia.org/wiki/Databasehttp://en.wikipedia.org/wiki/Catalogueshttp://en.wikipedia.org/wiki/Electronic_Data_Interchangehttp://en.wikipedia.org/wiki/Electronic_Funds_Transferhttp://en.wikipedia.org/wiki/Purchase_orderhttp://en.wikipedia.org/wiki/Invoicehttp://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Product_(business)http://en.wikipedia.org/wiki/Servicehttp://en.wikipedia.org/wiki/Computer_networkhttp://en.wikipedia.org/wiki/Electronic_funds_transferhttp://en.wikipedia.org/wiki/E-marketinghttp://en.wikipedia.org/wiki/Online_marketinghttp://en.wikipedia.org/wiki/Online_transaction_processinghttp://en.wikipedia.org/wiki/Electronic_data_interchangehttp://en.wikipedia.org/wiki/Internethttp://en.wikipedia.org/wiki/Extranethttp://en.wikipedia.org/wiki/E-mailhttp://en.wikipedia.org/wiki/E-bookhttp://en.wikipedia.org/wiki/Databasehttp://en.wikipedia.org/wiki/Catalogueshttp://en.wikipedia.org/wiki/Electronic_Data_Interchangehttp://en.wikipedia.org/wiki/Electronic_Funds_Transferhttp://en.wikipedia.org/wiki/Purchase_orderhttp://en.wikipedia.org/wiki/Invoice


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were also forms of e-commerce (Grooves et al, 1997). However, from the 1990s

onwards, this would include enterprise resource planning systems (ERP) and data

warehousing.

In the "dot.com" era, it came to include activities more precisely termed "Webcommerce" -- the purchase of goods and services over the World Wide Web via secure

servers (note HTTPS, a special server protocol which encrypts confidential ordering

data for customer protection) with e-shopping carts and with electronic payment

services, like credit card payment authorizations.

Today, it encompasses a very wide range of business activities and processes, from e-

banking to offshore manufacturing to e-logistics. The ever growing dependence of

modern industries on electronically enabled business processes gave impetus to the

growth and development of supporting systems.

Although a large number of "pure e-commerce" companies disappeared during the dot-

com collapse in 2000 and 2001, many "brick-and-mortar" retailers recognized that such

companies had identified valuable niche markets and began to add ecommerce

capabilities to their web sites. For example, after the collapse of online grocerWebvan,

two traditional supermarket chains, Albertsons and Safeway, both started ecommerce

subsidiaries through which consumers could order groceries online. This resulted in a

significant increase of the market share for the supermarkets. In line with the above

purchase of groceries, the researcher is going to apply a litmus test of the same on

PBC and see whether all banking transactions can be done via e commerce. This will

allow clients to log on to PBCs website from anywhere in the world and be able to

transact.

The evolution of e-commerce in the early 2000s onwards saw multinational (MNCs) ortransnational (TNCs) companies establishing regional shared services centers, regional

data centers and regional call centers. Today, this is not only a crucial part of a

company's long-term corporate strategy in cost containment, but also in maintaining

and winning market share in a borderless, global marketplace. The application of such

e commerce solutions should be able to increase trade volumes at PBC since it will

be able to attract investors from any where in the country and even beyond the

borders.

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http://en.wikipedia.org/wiki/Enterprise_resource_planninghttp://en.wikipedia.org/wiki/Data_warehousinghttp://en.wikipedia.org/wiki/Data_warehousinghttp://en.wikipedia.org/wiki/World_Wide_Webhttp://en.wikipedia.org/wiki/HTTPShttp://en.wikipedia.org/wiki/Protocol_(computing)http://en.wikipedia.org/wiki/Encryptionhttp://en.wikipedia.org/wiki/E-shopping_carthttp://en.wikipedia.org/wiki/Credit_cardhttp://en.wikipedia.org/wiki/Dot-comhttp://en.wikipedia.org/wiki/Dot-comhttp://en.wikipedia.org/wiki/Webvanhttp://en.wikipedia.org/wiki/Albertsonshttp://en.wikipedia.org/wiki/Safewayhttp://en.wikipedia.org/wiki/Shared_serviceshttp://en.wikipedia.org/wiki/Data-centrehttp://en.wikipedia.org/wiki/Call_centershttp://en.wikipedia.org/wiki/Enterprise_resource_planninghttp://en.wikipedia.org/wiki/Data_warehousinghttp://en.wikipedia.org/wiki/Data_warehousinghttp://en.wikipedia.org/wiki/World_Wide_Webhttp://en.wikipedia.org/wiki/HTTPShttp://en.wikipedia.org/wiki/Protocol_(computing)http://en.wikipedia.org/wiki/Encryptionhttp://en.wikipedia.org/wiki/E-shopping_carthttp://en.wikipedia.org/wiki/Credit_cardhttp://en.wikipedia.org/wiki/Dot-comhttp://en.wikipedia.org/wiki/Dot-comhttp://en.wikipedia.org/wiki/Webvanhttp://en.wikipedia.org/wiki/Albertsonshttp://en.wikipedia.org/wiki/Safewayhttp://en.wikipedia.org/wiki/Shared_serviceshttp://en.wikipedia.org/wiki/Data-centrehttp://en.wikipedia.org/wiki/Call_centers


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BUSINESS-TO-BUSINESS E-COMMERCE

As the Zimbabwean economy becomes increasingly integrated into the global village,

the internet becomes more and more relevant and important as well. No business in

this world can achieve sustainable long term growth without the internet. The use of e

commerce can be used to get competitive prices. Many Zimbabweans nowadays utilize

the internet to search for business information as well as for transaction purposes.

Online advertising, marketing and selling is now a common business practice of today,

tomorrow and beyond. Most investors in this age especially in foreign markets prefer to

buy goods and services in the comfort of their offices using their banks and credit

cards. This will create less hustle for both the buyers and the sellers as funds and

securities will directly move from one account to the other electronically.

Business-to-Business refers to a broad range of intercompany transactions, including

wholesale trade as well as company purchases of services, resources, technology,

manufactured parts and components, and capital equipment. May (2000) argues that

B2B also includes many types of financial transactions between companies, such as

reinsurance, commercial credit and electronic networks for trading bonds, securities

and other financial assets. He adds that B2B transactions exclude those involving

households, such as retail sales, inter-consumer exchange, and employment.

Companies in B2B e-commerce offer innovative economic transactions. Daniel (2006)

contends that acting as intermediaries, many B2B companies propose to design

innovative transactions between a company and its many suppliers; that is, they

reorganize supply chains.

For example, some B2B companies provide centralized online auctions. Emcmillan(2004) put forward that centralized markets create efficiencies by reducing search

costs, allowing buyers and sellers to meet each other through the central exchange.

Bahra (2001) argues that when there are many buyers and sellers, centralized markets

also can reduce time costs by replacing bilateral negotiation with formal bidding

mechanisms and information about transaction prices. Moreover, by partially

supplanting the procurement function of buyers and the sales function of suppliers, B2B

intermediaries affect company decisions about procurement and intra- firm transfers of

goods and services. Cotton (2002) notes that companies may choose to rely more on

outside intermediaries for procurement and sales activities, and less on internal

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purchasing and sales personnel. Procter (1998) adds that B2B e-commerce is directed

toward alleviating transaction inefficiencies in the supply chain.

Companies in manufacturing, mining, construction, transportation, public utilities, and

other sectors all buy from and sell to other firms. There is substantial intercompany

exchange in the financial sector as well, in such areas as securities trading, investment

banking and reinsurance (UNCTAD, 2004). Bodnar and Hopwood (1998) assert that

such transactions consume substantial efforts involving marketing and sales,

purchasing, financing, technology procurement, and accounting. Ecommerce

promises to reduce the costs of inter-business transactions by automating many

individual steps in the procurement process.

Traditionally, inter-business transactions begin with a company evaluating the input

purchasing required to carry out its business strategies or a supplier seeking buyers for

its goods and services (Sarmento, 2000). Next buyers search for suppliers (and vice

versa), through advertising, trade shows, brokers, and dealers. Buyers then negotiate

with potential sellers concerning product specifications and prices, and perhaps

conclude a spot transaction or form a long-term contract. After the agreement has been

reached, the transaction itself still involves ordering, billing, arrangements for

transportation, confirmation of payments, and acceptance of delivery.

Norris (2001) put forward that ecommerce innovations aim to reduce the cost of

procurement before, during and after the transaction. Before the transaction, Internet

technology may lower the cost of searching for suppliers or buyers and making price

and product comparisons. Alf Sherk, the founder of e-Chemicals, claims that When

youre dealing with one or two drum quantities, the cost of comparison shopping can bemore than the value of the product (Jones, 1999). According to Bahra (2001)

intermediaries reduce search costs by consolidating markets, providing an assortment

of goods and services that gives buyers the cost efficiency of one-stop shopping. He

adds that online intermediaries further lower search costs by providing information.

Vuksic and Strugar (2001) are for the view that by merely providing a comprehensive

list of potential suppliers of a specialized product, the intermediary can significantly

reduce search costs for a buyer. Laudon and Laudon (1998) add that costs can be

reduced by providing catalogues of product information from different suppliers,

enabling easy product comparisons, rather than requiring the buyer to use up costly

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time to contact the suppliers for the information. Norris (2001) also adds that

intermediaries can provide price information for each product. The intermediary may

even provide dynamic pricing mechanisms, such as auctions or automated negotiation

rules, which cause prices to respond quickly to variations in demand and supply.

Furthermore, Alexander (2000) argues that B2B e-commerce attempts to create

markets that will replace intra-firm transfers of goods and services. He adds that

vertically integrated firms engage in substantial internal sales and procurement

activities. Groves et al (1997) note that B2B e-commerce can enable outsourcing of the

management of these external and internal transactions; that is, specialized

intermediaries may handle many of these transactions. For companies that purchase

externally, these intermediaries would substitute for many of the activities of company

purchasing departments. May (2000) adds that vertically integrated companies might

reorganize to outsource production of goods and services that were previously

produced internally, and again rely on intermediaries to help with procurement. The end

result would be a fundamental change in the way that businesses transact with each

other as well as the way in which businesses are organized.

Erber et al (2001) contend that such innovations in economic transactions depend on

advances in computer networking technology that significantly reduce the costs of data

communication. The Internet and its associated hardware and software technologies

can lower the costs of communicating data, both data transmission between companies

and within organizations (Intel, 2004). Kessler (2003) assert that although advances in

computer networking technology provide the impetus, advances in Internet commerce

depend on innovations in the way that transactions are organized. Lowering transaction

costs often entails the design of novel types of transactions. For example, the oilcompanies BPAmoco, Royal Dutch/Shell Group and Totalfina Elf Group along with

financial services companies Deutsche Bank, Goldman Sachs, Morgan Stanley Dean

Witter and Societ Generale have announced a new electronic marketplace for over-

the-counter energy, metal, and other commodities called the Intercontinental

Exchange, that will replace transactions that were largely conducted by telephone

(Shmukler, 2000). The Intercontinental Exchange market will have various novel

features including the provision of information to traders regarding their counterparties,

such as their credit worthiness, and information regarding market aggregates (Market

News Publishing, 2000).

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Internet commerce offers many of the benefits of electronic data interchange (EDI)

without its high costs. Like EDI, Internet commerce offers the benefits of speed and

accuracy (Intel, 2005). Ben (2006) adds that by linking their computers, companies can

communicate without the costs of translating computer files into paper documents, a

process that involves errors, delay and costly clerical personnel. EDI provided these

benefits years ago for some companies, but costs were relatively high because EDI

involves proprietary software and point-to-point communications (Alexander, 2000).

Cotton (2002) argues that internet technology typically involves open standards on a

global network. In order to add a new supplier to their EDI purchasing system, for

example, a firm would have to establish a new network link with that supplier, and have

new software installed on that suppliers computer systems. Shapiro and Varian (1999)

argue that internet-based electronic purchasing connections can be much less costly to

set up, since they involve hardware connections that the company is probably already

using for other purposes, and can likely be established using off-the-shelf software

rather than customized proprietary solutions.

Bach and Erber (2001) put forward that after the transaction, electronic commerce may

allow companies to communicate at very little cost to confirm delivery and to monitor

contractual performance. In addition, companies will more readily be able to use the

information generated by the transaction to update their inventory and accounting

records. Seybold (2000) put forward that companies can automatically link their

transactions to software used for supply chain management, enterprise resource

planning, and final customer sales. A key technology expected to facilitate B2B e-

commerce is the application of Extensible Markup Language (XML). The language is a

refinement of the Standard Generalized Markup Language (SGML), which is alanguage used to define languages. The XML language allows documents to be treated

as data, so that computers can exchange data more effectively, thus aiding the

automation of data exchange between companies. Standardized XML data-description

tags are being developed for different market applications, in order to capture the

types of data that are most important in each market (sizes, prices, material grades,

colours, delivery methods, etc.). If the standards are generally adopted, this will help

manufacturers, suppliers and distributors to exchange commercial information without

creating customized formats for each partner (Mitchell, 1999).

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Hypertext Markup Language (HTML) speeded the development of Internet web sites by

establishing a standard format for documents that allows users to use a standard

browser to view styled text, graphics, and hyperlinks to other Web pages. The XML

standard promises similar advantages for exchange of information between

businesses, including data on sales, inventory, production, payments and

transportation. Using XML, a person can receive and analyze data obtained on the

Internet without the need to go back to the host server on which the data is stored, thus

vastly speeding up communication and making more efficient use of scarce server

capacity and reducing Internet traffic. For example, a user can obtain information from

a travel agency about flights on a given day and then compare airfares and itineraries

without relying on data processing by the travel agencys server (Bosak and Bray,

1999). Because of its flexibility, XML should allow each industry to establish simple

standards for the exchange of data and the execution of commercial transactions.

2.3 BANKING CONSUMER OPTIONS

Bahra 2001 defined three types of business models that are available to the consumer:

Brick and mortar institution- financial institution that has a building and personalservice representatives but does not offer internet banking services.

Brick and click- financial institution that has a physical structure and also offers

internet banking services

Virtual bank-financial institution that has no public building and exists only

online.

2.4 TYPES OF ONLINE BANKING

Internet banking- Conducted through a personal computer that connects to a

banking website via the internet. Internet banking can also be conducted via

wireless technology through either Personal Digital Assistants (PDAs) or cellular

phones.

Electronic Banking is conducted by using Automatic Teller Machines (ATMs),

telephones (not via the internet) or debit cards

Advantages of using Online Banking to the clients:

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Convenience- save on time and transport costs to the bank

24 hours by 7 days access to the bank

Secure electronic transactions

Instant credit/ payments

Quicker and easier reconciliations

Saving on transit and cash handling fees

Reduced staff embezzlement and fraud

Advantages of using Online Banking to the banks

Less queues

Reduced stationary costs

No need to have huge amounts of cash in vaults as most transactions are

electronic

Reduced pressure on the bank personnel

Profitability increases

Increased distribution because of the virtual nature of the channels

Strengthens the brand

Advantages of using Online Banking to the economy

Reduced costs associated with note printing

Cheque frauds reduced

Improves clearing systems

General lifestyle improves because of the better convenience brought by

electronic banking.

Disadvantages of electronic payment channels

The disadvantages of eBanking mainly relate to security threats, abuse of resources,

technology complexity, cost challenges, legal issues and cost incurring disadvantages.

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It is imperative that banks adequately address these disadvantages if they are to reap

the benefits from e commerce.

Security Challenges

Document processing using computers is amenable to abuse.

Cost incurring disadvantages

Ecommunication investments require huge initial costs for a secure network

and sophisticated hardware and software.

Legal issues

Legal issues pose a major constraint to conducting ecommunication on the

internet.

2.5 GLOBAL EMPIRICAL RESEARCH ON E COMMUNICATION

Banks are realising that in order to fully exploit the capabilities of the internet, they must

reshape their strategies and deliver products in a more innovative manner in terms of

product variety and lower prices. (Grooves, Biemer, Lyberg, Massey, Nichloas and

Hagel 111 1997). It is possible to conduct on line, all traditional features of banking,

due to the product oriented nature of banking. Flexibility of online banking resulted in

nearly 30% of savings for consumers. This was the motive that justified the embracing

of the internet by Wells Fargo Bank (Laudon and Laudon 1998).

According to Sarmento, (2000) if banks can provide what customers want and not be

hampered by the legacy of complex internal structures, they will have a chance for

survival and growth through the internet. Over the past few years, the internet has had

a magnificent effect on financial services because it offers an unprecedented degree of

information efficacy.

It is estimated that in the United States, only 500 000 households invested online in

1996. (Forrester Research). By 2001, the number of households that conducted on-line

financial transactions and grown to about 3.3 million. (Vuksic & Strugar 2001). Today,

roughly 4.5 million households use internet banking and or bill payment at least once a

month, and that number is expected to increase 53.5 million , nearly 40% of all

households by 2008.

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Given the wealth of opportunities the internet creates for financial services companies

and the accelerated pace with which banks are going online, having an internet

presence will become a strategic necessity for most banks, thrifts and other financial

institutions. From 1977 to 1988, Citibank, an early adopter of ATM technology,

increased its market share in New York City from 4% to 13.4%. ATMs were a

substantial driver of this impressive growth. Indeed in its early stages, the ATM was a

source of strategic differentiation for Citibank and other early adopters, but as

technology was deployed more widely, the source of value associated with the ATM

shifted. No longer does ATM differentiate a bank, it is now expected by consumers as a

basic service offering. ATMs have migrated from a differentiator to a strategic necessity

and so will internet banking.

For most banks, the future of the internet lies in how well it can be integrated with more

traditional delivery channels. But in the end, profitability will depend primarily on the

quality of the products and services that banks deliver to customers, not necessarily on

how those products are delivered. (Cotton 2000). More recently, banks have

augmented their distribution networks with transactional web sites, which allow

customers to open accounts, apply for loans, check balances, transfer funds and make

and receive payments online.

Despite the many factors inhibiting the growth of e commerce in Africa, and minimal

progress in appropriate legislation, commercial concerns in several African countries

are actively pursuing e commerce ventures, albeit on a small scale. Two rather

imperfect measures of e commerce activities are the extent of internet and web

based activity in a country. Table 1 below shows a breakdown for SADC countries in

terms of internet subscribers per country and the international bandwidth used.

Table1 Overview of internet usage and international bandwidth for SouthernAfrican Countries (Jensen, 2001)

Country Dialup Number International International

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Internet

Subs Total

#

ISPs Bandwidth

Kbps

Hubs #

Total 892,850 132 793,634 32

South Africa 750,000 75 750,050 5Total Excluding

SA

142,850 57 43,634 27

Mauritius 35,000 1 4,096 1

Botswana 25,000 6 14,000 1

Zimbabwe 20,000 8 5,120 1

Tanzania 20,000 14 4,096 3

Namibia 15,000 3 3,072 2

Zambia 6,500 3 3,072 3

Mozambique 6,000 5 2,048 3

D.R.Congo 4,500 5 2,048 3Angola 4,000 4 192 1

Malawi 2,400 2 1,024 3

Seychelles 3,000 2 4,098 2

Swaziland 1,200 2 256 2

In several respects South Africa is unique in Africa as regards e commerce.

Accordingly it is dealt with separately. In the SADC region (excluding South Africa) the

overall volume of e business is very small and growing at a slower rate than world e

business. For several well known reasons, South Africas e commerce characteristics

straddle the line between developed and developing countries. The South African

market is leveraged by its superior technical, social and capital infrastructure.

It has been noticed that during the last few years, African governments started lifting

barriers to competition in the whole continent. Africas international internet bandwidth

will grow tenfold in the next five years, mostly driven by the demand for data services.

(Pyramid 2004)

2.6 SUCCESS FACTORS IN E-COMMERCE

Ben (2006) put forward that an e-commerce company will survive not only based on its

product, but by having a competent management team, good post-sales services, well-

organized business structure, network infrastructure and a secured, well-designed

website. Such factors include:

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A good management team armed with good and sound information technology

strategy. A company's IT strategy should be a part of the business re-design

process.

Providing an easy and secured way for customers to effect transactions. Creditcards are the most popular means of sending payments on the internet,

accounting for 90% of online purchases. In the past, card numbers were

transferred securely between the customer and merchant through independent

payment gateways. Such independent payment gateways are still used by most

small and home businesses. Most merchants today process credit card

transactions on site through arrangements made with commercial banks or

credit cards companies.

Providing reliability and security. Parallel servers, hardware redundancy, fail-

safe technology, information encryption, and firewalls can enhance this

requirement.

Providing a 360-degree view of the customer relationship, defined as ensuring

that all employees, suppliers, and partners have a complete view, and the same

view, of the customer. However, customers may not appreciate the big brother

experience.

Constructing a commercially sound business model. If this key success factor

had appeared in textbooks in 2000, many of the dot-coms might not have gone

into bankruptcy.

Engineering an electronic value chain in which one focuses on a "limited"

number of core competencies -- the opposite of a one-stop shop. (Electronic

stores can appear either specialist or generalist if properly programmed.)

Operating on or near the cutting edge of technology and staying there as

technology changes (but remembering that the fundamentals of commerce

remain indifferent to technology).

Setting up an organization of sufficient alertness and agility to respond quickly to

any changes in the economic, social and physical environment.

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Providing an attractive website. The tasteful use of colour, graphics, animation,

photographs, fonts, and white-space percentage may aid success in this

respect.

Streamlining business processes, possibly through re-engineering andinformation technologies.

Providing complete understanding of the products or services offered, which not

only includes complete product information, but also sound advisors and

selectors.

May (2000) asserts that naturally, the e-commerce vendor must also perform such

mundane tasks as being truthful about its product and its availability, shipping reliably,and handling complaints promptly and effectively. Bhasin (2003) put forward that a

unique property of the internet environment is that individual customers have access to

far more information about the seller than they would find in a brick-and-mortar

situation.

Erber et al (2001) note that a successful e-commerce organization must also provide

an enjoyable and rewarding experience to its customers. They add that many factors

go into making this possible. Such factors include:

Providing value to customers. Vendors can achieve this by offering a product or

product-line that attracts potential customers at a competitive price, as in non-

electronic commerce.

Providing service and performance. Offering a responsive, user-friendly

purchasing experience, just like a flesh-and-blood retailer, may go some way to

achieving these goals.

Providing an incentive for customers to buy and to return. Sales promotions to

this end can involve coupons, special offers, and discounts. Cross-linked

websites and advertising affiliate programs can also help.

Providing personal attention. Personalized web sites, purchase suggestions, and

personalized special offers may go some of the way to substituting for the face-

to-face human interaction found at a traditional point of sale.

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Providing a sense of community. Chat rooms, discussion boards, soliciting

customer input and loyalty programs (sometimes called affinity programs) can

help in this respect.

Owning the customer's total experience. E-tailers foster this by treating anycontacts with a customer as part of a total experience, an experience that

becomes synonymous with the brand.

Letting customers help themselves. Provision of a self-serve site, easy to use

without assistance, can help in this respect. This implies that all product

information is available, cross-sell information, advise for product alternatives,

and supplies & accessory selectors.

Helping customers do their job of consuming. E-tailers and online shopping

directories can provide such help through ample comparative information and

good search facilities. Provision of component information and safety-and-health

comments may assist e-tailers to define the customers' job.

2.7 GETTING THE BUSINESS ON THE WEB

There are three steps to analyze when looking at the creation of an online business:Consideration, Implementation, and Finalization.

Consideration

How does a business know whether they should engage in such a practice?

Despite the obvious advantages to e-commerce, it does not always meet the long

term needs of a company (Groves et al, 1997). Alexander (2000) notes that if the

market for the product or service is quite small, then there is no need to engage ine-commerce as it will be less difficult to gain competitive advantage and would only

result in unnecessary costs and expenses. May (2000) put forward that if the

company wishes to remain domestic and not expand its services, then a company

would be better suited to follow the normal processes of advertising than

participating in e-commerce. Seybold (2001) notes that a company must consider

whether the business would even succeed or thrive in the e-commerce

environment. For example, selling food online would not be a viable venture, as the

ultimate costs (wastage, storage, transportation) would outweigh the benefits.

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However, Cotton (2002) argues that if a company believes that their product has

great market potential outside of their domestic realm, and feel that they can

participate in e-commerce, then some time must be taken to lay down the floor plan

for the business. Some aspects to consider are:

i. What is the idea for the business?

ii. Is it a product or service?

iii. What is the name of it?

iv. Will you emphasise price, quality, service, or another point?

v. What is the target market?

Implementation

The key to successfully starting and creating an online business is choosing the

right Web host (Intel, 2005). Try to find one that offers guarantees, is flexible,

responds to your concerns, and quite simply is one that offers the services that you

want and need. Once the firm has found the right Web host and created an

account, the next step is start building the firms site. Daniel (2006) put forward that

having an attractive yet simple site will have a great impact. Ensure that it projects

the right image and is directed to the right target market for your product. It should

be easy to navigate and have a solid search option. Also clarify what sorts of

policies you will implement, such as return policies, acceptance or rejection of

credit cards, check-out, and any other payment options such as cheques or money

orders.

If selling products, there are many types of software out there to help you create aneffective and efficient ordering system. Look at the features that you will need for

your site and compare them to the software that is available.

Finalization

Now that the firm has created the website and is ready to begin, the next important

step is to market your online business (Intel, 2005). The options are numerous and

can include:

i. Join a search engine and pay a fee for placement

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ii. Contract with affiliate sites and programs

iii. Advertise

iv. Virally market

v. Use promotions

A key step is developing some sort of PR strategy. Cotton (2002) put forward that

customers are the most important aspect of the business. Make them happy. This can

include offering links on your site to answer Frequently Asked Questions (FAQs),

shipping quickly, designing a system for easy returns, as well as any other type of

customer service ( Norris, 2001).

Ben (2006) asserts that it is also important to constantly change and maintain the

freshness of the organisations site. This includes altering colors and creating new

displays. Daniel (2006) adds that another noteworthy option is to include some sort of

statistical counter so as to find out where the customers are logging in from and what

they doing on the site. Test any advertisements that you create to see how effective

they are.

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CHAPTER 3 METHODOLOGY

3.1 INTRODUCTION

Research methodology is the philosophical basis on which research is founded,

White B (1998). It basically looks at the research design, units of analysis, data

collection instruments, the population and sample of interest.

3.2 RESEARCH PHILOSPHY

Based on the positivism philosophy, the research will take both qualitative and

quantitative approaches in order to provide an in-depth analysis of the data. Research

paradigms incorporate the fundamental philosophical concepts and values about the

nature of reality and the scientific pursuit of knowledge. Essentially, two schools of

thought about the research process dominate the literature: positivism (quantitative)

and phenomenological (qualitative) research. They hold diametrically different views

about the way in which knowledge is developed and judged as being acceptable.

Taking into consideration the strengths and weaknesses that flow from purely

positivism and phenomenological bias in research, the researcher will adopt a mixed

approach that draws from both extremes, but, with a heavy inclination towards the

latter. This approach is considered to be adequate as it enables the researcher to

increase the reliability and validity of the findings because weaknesses of one method

are balanced by the strengths of the other method.

POSITIVISM RESEARCH

Positivist research is generally quantitative and involves the use of numerical

measurement and statistical analysis of measurement to examine phenomena. It

views reality as consisting phenomena that can be observed and measured (Remenyi

et al, 1998:32) thus assuming that the researcher is independent of and neither affects

nor is affected by the subject of the research (Chill and Johnson, 1997). The

advantages of this quantitative approach are that it places great premium on objectivity

and reliability of findings and encourages replication. Applied to social sciences and

business management research, positivism may not always be appropriate, as all

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social phenomena cannot be accurately and reliably measured, thus reducing the

validity of the findings.

PHENOMENOLOGICAL RESEARCH

In contrast, phenomenological or qualitative researchers argue that the world is socially

constructed and that science is driven by human interests and that the researcher, as a

subjective entity, is part of the world he or she is observing. Total objectivity, is

therefore an impossible aim. The advantages of this qualitative, interpretive orientation

in research are that the findings often have greater validity and less artificiality as the

process of observing phenomena in natural, real-life settings often allows researchers

to develop a more accurate understanding of those phenomena.

Good qualitative research often reveals depth of understanding and richness of detail.

Research driven by phenomenological philosophy is sometimes undermined by the

subjectivity of the researcher and the poor reliability of the findings in that, two

researchers may arrive at different conclusions based on their observations of the

same phenomena at the same time (Saunders et al2003:84).

3.3 RESEARCH DESIGN

A research design is a plan and structure of investigation so conceived to obtain an

answer to a research problem, Jones A.R (1996). In this study, the researcher will

use the descriptive survey approach combined with case studies in order to elicit as

much information as possible from the respondents. A case study uses multiple

sources of evidence, Johnson (1994), and this has the advantage of exposing the

researcher to a wide range of views on the subject matter being investigated.

www.statpac.com/surveys/sampling.htm. (17 November 2006: 11.05 a.m.) states that

whatever the research question(s) and objectives, there will be need to collect data to

answer them. The website further advises that it is incumbent on the researcher to

clearly define the target population to which the objectives of the study are addressed.

For the purpose of this study, the researcher will identify two major groups of people

that have both direct and indirect influences on the operations of PBC.

The first group is composed of people or individuals who work from within the

organization and are mandated with policy formulation and implementation. This group

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of influencers include chief executive officer and line management, operating core staff

as well as supporting staff.

On the other hand, the second group will comprise of the banks clients and also

corporates who do not currently hold accounts with PBC.

3.4 SAMPLING

Samples will be drawn from various levels of employees in the participating

organisations using the stratified sampling method. A sample is a proportion of the

population that is representative, Babie (1989). The stratified sampling method was

used to ensure that all sections of the population were represented in the samples

that were drawn in order to have a representative balance of views. Stratified

sampling uses natural divisions of a sample frame such as sex, age, income group,or occupation and this ensures adequate representation of the population.

Sampling Techniques

For some research questions, it is possible to survey an entire population as it would

be of a manageable size. However, for many research questions and objectives, it will

be impossible to either collect or to analyse all the data available owing to restrictions

of time, money and often accessibility. In order to overcome these challenges, the

researcher will employ sampling techniques. Sampling techniques provide a range of

methods that enable one to reduce the amount of data to collect by considering only

data from a subgroup rather than all possible cases or elements. Sampling is therefore

likely to be less expensive, saves time, have manageable data and produce equally or

more accurate results than a population (Henry 1990). Sampling techniques can be

divided into two groups namely; probability and non-probability sampling.

Probability Sampling

Probability sampling is based on the concept of random selection a selection

procedure that ensures that each element of the population is given a known chance of

selection and is usually equal for all cases. Five main cases can be used to select a

probability sample and these are simple random sampling, systematic sampling,

stratified random sampling, cluster sampling and multistage sampling.

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This technique is most commonly associated with surveybased research (Sanders et

al, 2005) where there is need to make statistical inferences from the sample about the

population. With probability sampling, researcher bias and subjectivity is reduced or

eliminated through the random selection of elements. Although it provides the

researcher with a powerful statistical analytical tool, probability sampling is rather costly

and time consuming.

Non-Probability Sampling

In contrast, non-probability sampling is non random, subjective and purposive in that

the research may select the sample using deliberate and consciously controlled criteria

other than those associated with randomness of selection. Since the probability of

each element being selected from the population is not known, it is almost impossible

to address objectives or questions that require statistical inferences about the

characteristics of the population. For this reason, non-probability sampling is more

frequently used for exploratoryqualitative studies such as case study research.

Cost and time variables may also influence the choice of non-probability sampling as

probability sampling requires careful planning and comprehensive effort in electing the

population and establishing the sampling frame. Non-probability is also more flexible

as it allows the researcher to capture a wider range of important facets than the

probability sampling. Despite its simplicity, the fact that it allows researcher bias and

subjectivity to affect sampling procedures, the research findings are subject to

distortions. As with probability sampling, non-probability sampling is divided into five

main categories, namely; convenience judgement or purposive, quota, maximum

variation and snowball sampling.

Sampling method used

In view of the research objectives and the pros and cons of the probability and non-

probability sampling techniques, the researcher will use non-probability sampling due to

its flexibility in selecting the sample. A quota sampling technique will be used to

identify target groups of respondents who are in a position to provide necessary and

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informed opinions which would assist in testing the hypothesis as stated in Section 1.8

above.

According to Saunders et al(2005), quota sampling may be an appropriate choice toimprove the representativeness of the study if the population is divided proportionately

into predetermined categories and the elements in each category are deliberately

selected from the population until a particular quota has been met for each category.

Saunders et al (2005) went further by stating that the quota sampling requires two

basic conditions first, the categories should have a distribution in the population that

can be estimated and, secondly, the variable used in forming each category should be

pertinent to the topic of study.

In this respect, the researcher first identified the categories and their proportions as

they are represented in the population. To reinforce the quota sampling method, a

judgemental sampling method was also incorporated in order to identify or choose

relevant elements and or respondents from each category to the issues being studied.

This method was considered to be appropriate because samples or elements were

chosen deliberately as they were considered to be representative of the population on

the basis of the samples knowledge of the companys business fundamentals.

Sample Size

The size of the sample is almost always a compromise between the accuracy

(confidence) of the findings and the amount of time and money needed in the

collection, checking and data analysis. Given these competing influences, it is not

surprising that the final sample size is almost a matter of judgement as well as of

calculation (Saunders et al, 2005). Any research must, however, be guided by the fact

that a sample that is too small is not likely to be representative of the population, while

one that is too large is likely to increase costs and time demands without producing

significant benefits. Bell J. (1999) submitted that statistically, a minimum sample of 30

is held by many researchers to be acceptable.

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Cognisant of this advice, the researcher considered that a proportion of one third (1/3)

from each of the population categories as defined above, giving a total sample of 70

would suffice for purposes of this study. The sample (refer to table 2) would be

representative to meet the requirements of this enquiry since it is the quality, rather

than the quantity of the sample that is the researchers prime concern. The quality of

the sample is important as valuable lessons can be drawn from it and be applied

successfully to the economy at large.

Table 2 Sample size

Category Sample Size

PBC Clients 40

PBC staff 20

Listed corporates but non clients 10

TOTAL 70

Research Instruments

Research instruments are the tools used for gathering data for research. Using

more than one method of collecting data is often a prudent procedure. In this light

the researcher will use questionnaires and personal interviews.

The researcher will engage various groups of employees in interviews during lunch

breaks in order to complement questionnaires so that some of the shortcomings of

questionnaires could be addressed.

3.5 DATA COLLECTION

In almost all studies, a researcher has two main sources of data, namely, primary and

secondary data sources. However, there are several data collection methods available

to the researcher and these include, survey, experiment and ethnography. Some of

these clearly belong to the deductive tradition, others to the inductive approach.Allocating these data collection strategies to one tradition or the other is unduly

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simplistic because these strategies are not mutually exclusive to each other (Bell

1999:78). With this in mind and the need to answer the research objectives, the

researcher will use both primary and secondary data.

Primary Data

Primary data will be mainly collected through a survey method directed at stakeholder

groups considered to be in a position to give relevant informed opinions e commerce

in the banking environment. The survey method is considered to be appropriate

because it allows for the collection of a large amount of data from a sizeable population

in a highly economical way. The survey method is also flexible and adaptable, thus it

gives the researcher more control over the research process.

In order to collect relevant, reliable and adequate primary data, the researcher will use

the self administered questionnaire and the interviewer administered method.

Self Administered Questionnaire

A common place for observing data beyond the physical reach of the observer is

the questionnaire, Leedy (1980). The researcher will employ the questionnaire

method of collecting data, which is a set of written questions that are either mailed

to the individual or simply handed out.

The questionnaire will be divided into three sections. Section A will solicit information

on demographic data for the respondents, as it is always important to know such

information as age and gender of the respondents. Section B will seek to obtain data

through the use of close-ended questions, which, according to Bouma and Atkinson,

(1999), are questions that force the respondent to select a single response from a list.

Section C is meant to collect data through open-ended questions designed in such a

way that the respondents were given room to express themselves in their own words.

The whole set of questions will enable comprehensive responses to be given to the

research to give a true picture on the subject researched on.

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Self administered questionnaires are those which are completed by the respondents

without direct interference from the interviewer. Such questionnaires can be conducted

electronically through e-mail, through postal services, through the fax, or personally

hand delivered to each respondent and collected.

In this study, the researcher will use the self-administered questionnaire as the main

mode of primary data collection because of its flexibility to capture data from different

sets of people at no extra costs. A self-administered questionnaire also allows

respondents to work through the questionnaire at their own pace and any possible bias

brought to bear by the presence of an interviewer is avoided. Furthermore,

questionnaires provide uniform or standardized data, which is normally easy to process

and present. The main shortcoming of the questionnaire method is that respondents

would be trying to recreate their views and attitudes which they held at a past time.

People usually tend to forget some important facts and end up guessing in order to fill

the questionnaire.

To gain maximum synergy, the researcher will craft the questionnaire in such a way

that the questions individually and collectively provide the relevant information or data

required to successfully address the research objectives and questions. In this regard,

the questionnaire will have a range of question categories, each consisting of a small

number of related questions, intended to elicit information of a particular type relating to

the research topic. Due to the time factor and poor response rate associated with the

postal questionnaires, the researcher will resort to the personal hand delivery and

collection questionnaire as well as the online e-mail questionnaire.

Interviewer Administered Questionnaire

Responses to this type of instrument are recorded by the interviewer on the basis of

each respondents answers and these include telephone questionnaires and structured

interviews. The researcher will try to avoid telephone interviews because of the

complexity of the subject matter, the time taken and the relative costs involved.

Telephones would only be limited for constantly reminding respondents of the

impending deadlines.

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Semi-structured interviews are also preferred to total structured interviews as the

researcher would want to gather more information or data by varying the order in which

questions are asked and by asking new questions in the context of the research limits.

The main advantages of using interviews are:

the high response rate they can elicit

getting in-depth and comprehensive information

assist the respondents who may have difficulty comprehending some questions

respondents appreciate the seriousness of the researchers commitment to the

study.

The face-to-face interviews will be limited to the management of PBC as they are the

core architectures and executors of the companys e commerce strategies.

Both close-ended and open-ended questions will be used to collect data where

appropriate. Close-ended questions are used to circumscribe the respondents

responses to questions that needed specific answers. This also helps to guard against

unnecessary digression by the respondents. In this respect, single-option responses,

multiple choice questions, rating questions and ranking questions were used. The

closed-ended questions also provided easy coding and data analysis. On the other

hand, open-ended questions were used for probing sensitive issues as respondents

are provided with enough space to write their responses.

Advantages of the questionnaire

As a data collection instrument, the questionnaire was preferred due to the following

considerations;

The cost of sending out questionnaires is relatively low and this is

considered to be appropriate given the current hyperinflationary

environment prevailing in Zimbabwe.

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The approach allows time and space for respondents to think and

assimilate questions. Confidentiality is guaranteed through ensuring

anonymity.

The questionnaire allows for use of close-ended questions, which are

easy to administer and help keep the minds of the respondents

focused on the subject.

Questionnaires enable the researcher to cover a wider geographical

area,

However questionnaires have their own limitations, which include the following;

Questionnaires are suitable for respondents with some acceptable

degree of

literacy in order for them to understand them and respond accordingly.

This means that views of illiterate people cannot be captured using the

questionnaire method. However given the topic under study the

researcher is comfortable that there will be no illiterate respondents.

Some respondents may lose their questionnaires or simply

withhold them and the researcher would be required to redistributemore questionnaires to ensure a high response rate.

Questionnaires are inappropriate for complex issues that may

need further explanation to and from the respondents.

Completion of questionnaires can be delegated to other individuals

who may not necessarily be the prime target of the researcher.

However it is possible to minimize limitations of questionnaire method and theresearcher was always on guard in order to keep these limitations at minimum

levels. Using simple language and making items clear helps in reducing

limitations of questionnaires.

Personal Interviews

Interviewing involves verbal discussion with the target individual, White B

(1998). The researcher approached selected research subjects and asked

structured questions where spontaneous responses were obtained.

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Interviewing individuals helps in addressing some of the shortcomings of the

questionnaire method, especially where illiterate respondents were involved.

The success of a personal interview depends on the integrity and skill of the

interviewer, Fred Carswell (1995). In this light the researcher had to be tactful

in order to keep the interview consistent with the objectives of the research.

Some of the identified advantages of the interview method include the

following;

Interviews have a high response rate compared to questionnaires

since a skilled interviewer can persuade all but the most reluctant to

answer the questions.

The interviewer can explain questions that the interviewer cannot

understand.

It enables the interviewer to verify the answers by making visual

checks of age and appearance, for example, through observation and

non-verbal communication.

Offers the potential of collecting more information than other

methods.

However personal interviews have their own limitations that the researcher has

to manage in order not to compromise the quality of the study and these include;

The interviewer may, even unknowingly, introduce bias through the way he

asks questions. A good example is asking leading questions.

Failure to control the interview process.

Due to the nature of the research, some people may be too embarrassed to

give personal information in an interview and might end up withholding important

information.

It may turn out to be a very expensive method especially where interviewees

are geographically dispersed.

In order to minimize limitations of the interview method, the researcher will use

good interpersonal skills coupled with her working experience, as a relationship

manager, to ensure that the identified limitations of the personal interview

method will not influence the outcome of the research.

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3.6 DATA COLLECTION PROCEDURES

Various steps will be taken in administering research instruments and collecting

of data from the research subjects in this study. The researcher will use the

telephone, fax machine and the postal system in order to communicate with the

research subjects. For ease of collecting the completed questionnaires,

envelopes will be provided to the respondents so they will seal their responses

inside the envelopes and hand them over to the chosen representative. The

researcher will then get in touch with the representative to collect the responses

from a single point.

In order to ensure that the identified challenges will not interfere with the

research, the researcher will employ good time management and planning

techniques so that maximum use of time is achieved given the power cuts.

Ethical Considerations

In research, ethics are terms of a code of behaviour appropriate to academic

conduct, Babie (1989). Throughout the whole process of this study, from seeking

access to the organisations to data collection, analysis and reporting, ethical

considerations were observed. The following are some of the ethical issues

taken into account by the researcher in this study.

The confidentiality of data collected and the anonymity of participants will be

upheld by the researcher. Participants names and identification particulars will

neither be requested for nor documented. In the publication and analysis of

results, some information that could reveal confidential organisational aspects or

those issues perceived to have the potential to tarnish the image of the

organisations involved were left out.

Property Rights

The research will seek to avoid, at all costs, infringing on legal property rights.The researcher thus obtained permission to conduct the research and to have

access to other relevant information on PBC.

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3.7 DATA PRESENTATION AND ANALYSIS PROCEDURES

The researcher will analyze the data collected using the SPSS method and

results will be presented using tables, charts and descriptive statistics. Chartsand tables aid in data presentations in that they have a visual impression and

enable the reporter to present complex data in a simple and comprehensive

way. Data will also be analyzed in percentages for ease of interpretation by

readers.

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CHAPTER 4 RESEARCH FINDINGS AND DISCUSSION

4.1 INTRODUCTION

This chapter presents the research findings and discussion. These will be discussed in

relation to the literature of the study.

4.2 RESPONSE RATE

A total of 70 questionnaires were sent to the study respondents 65 were successfully

completed and returned representing a study response rate of 93%. The response rate

is high enough to warrant validity of the study findings.

4.3 LENGTH WITH ORGANISATION

Figure 1 Length in organisation

From the study findings most of the respondents (46 %) have 1-2 years with PBC, 45%

have 3-5 years, and 6 % have above 5 years, whereas an insignificant 3 % have less

than a year with PBC. Given that PBC established its entrance in the market in 2002, it

can be concluded that most of the respondents have been with the organisation for a

reasonably long time, hence are familiar with the processes at the organisation and

thus their contributions are of great value to the study.

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4.4 UNDERSTANDING E-COMMERCE

Table 3 below shows how the respondents understood e-commerce.

Table 3 Understanding e-commerce

Response % of respondents

Facilitation of commercial transactions

electronically

62

Complete set of processes that support

commercial /business activities on a

network

59

Buying and selling of goods and service

over an electronic system

71

Using the internet to trade 69

Table 3 shows that the majority of the respondents (71%) held that e-commerce is the

buying and selling of goods and services over an electronic system, 69% believed that

it is the using of the internet to trade, 62 % were of the view that e-commerce is the

facilitation of commercial transactions electronically while only 59% held that it is a

complete set of processes that support commercial or business activities on a network.

Table 4 Understanding e-commerce


Facilitation of commercial transactions electronically 62

Complete set of process that support

commercial/business activities on a network 59Buying and selling of goods and service over an electronic

system 71

Using the internet to trade 69

Table 4 shows that majority of the respondents (71%) held that e-commerce is the

buying and selling of goods and services over an electronic system, 69% believed that

it is the using of the internet to trade, 62% were of the view that e-commerce is the

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facilitation of commercial transactions electronically while only 59% held that it is a

complete set of processes that support commercial or business activities on a network.

Kessler (2003) put forward that electronic commerce (also referred to as EC, e-

commerce or ecommerce) consists primarily of the distributing, buying, selling,

marketing, and servicing ofproducts orservices over electronic systems such as the

Internet and othercomputer networks. Seybold (2001) asserts that the 'electronic' or 'e'

in e-commerce or e-business refers to the technology/systems; the 'commerce' refers

to be traditional business models. According to Alexander (2000) e-commerce is

defined as the complete set of processes that support commercial/business activities

on a network. In the 1970s and 1980s, this would also have involved information

analysis. In light of the above the respondents may have an understanding of e-

commerce and entails that the respondents may have an understanding of the

concepts under study. Their contributions add value to the study findings.

Table 5 what respondents think e-commerce involves


Buying, selling, distribution, marketing and servicing of

products or services over electronic systems

59

Electronic funds transfer

63

Supply chain management

37

Electronic data collection

43

Electronic data interchange

67

The study findings show that most of the respondents (67%) held a perception that e-

commerce involves electronic data interchange, 59% said it involves buying, selling,

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http://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Product_(business)http://en.wikipedia.org/wiki/Servicehttp://en.wikipedia.org/wiki/Computer_networkhttp://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Product_(business)http://en.wikipedia.org/wiki/Servicehttp://en.wikipedia.org/wiki/Computer_network


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distribution, marketing and servicing of products or services over electronic systems,

and 37% believed that e-commerce consists of electronic data collection. From the

study findings e-commerce involves electronic data interchange, electronic funds

transfer and buying, selling, distribution, marketing and servicing of products or

services over electron

dessert at ion draft research report mbl (2) final

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