identification of success factor for b2b e-commerce in

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Identification of Success Factor for B2B E-Commerce in Indonesia Lalita Padmapuspita J, Rahmat Nurcahyo & Djoko Sihono Gabriel Industrial Engineering Departement Universitas Indonesia Depok 16436, Indonesia [email protected] ; [email protected] ; [email protected] Abstract The potential of B2B e-commerce is very promising with the development of information and communication technology nowadays. So far there have been several B2B e-commerce players trying to work on the Indonesian market. The competition occurs among B2B e-commerce platform providers to fight for the potential of the B2B market in Indonesia which is still classified as “green” with various challenges faced. This research was conducted to identify the success factors of B2B e-commerce market in Indonesia by developing a questionnaire and implementing pairwise comparison matrix. The pairwise comparison matrix is used to determine the success factor for B2B e-commerce industry in Indonesia. The result is infrastructure IT is the most important success factor in developing B2B e-commerce in Indonesia and government support is the least success factors in developing B2B e- commerce in Indonesia. Keywords: B2B, E-Commerce, Competitive strategy, Pairwise comparison matrix 1. Introduction Information and communication technology have brought many significant changes in today's business world. With the rapid advancement of information and communication technology, it is possible to use the internet as a business tool to gain a greater competitive advantage by reaching a wider global market. In addition, ease of transaction and increased efficiency are among the most important things that can also be obtained by advances in information and communication technology. One of the things that is most felt by the development of information and communication technology is the explosion of digital business, especially in Indonesia, which is supported by the growing variety of e-commerce. However, the more widely known e-commerce models are the B2C (business to customer) and C2C (customer to customer) models. In fact, the B2B (business to business) model sector also has considerable potential. The potential of B2B e-commerce is targeting corporations, MSMEs, and other business actors. According to the DailySocial survey, 57.3% of 2000 respondents are familiar with the term B2B e-commerce and 36.36% of them or around 727 respondents have used this service. B2B e-commerce is concerned with systems and processes that support the flow of information between organizations from procurement, manufacturing, research and development, sales, and distribution of goods, information and services (Collier et al., 2003). Developing a business through B2B e-commerce can obtain several advantages such as reducing transaction costs because it can eliminate intermediaries, identify new markets, improve intra and inter-organizational communication, build better relationships with suppliers, and have more opportunities to have a wider business field with other big companies (Nirwan & Dhewanto, 2015). The development of B2B e-commerce will change not only procurement teams but goods and service providers to work more efficiently. A successful B2B platform not only allows buyers to access richer market information and reduces overall procurement costs by effectively searching and finding sellers who offer a wide variety of essential goods and services, but also enables sellers to reduce marketing and communication costs and by easier and access more buyers efficiently (Liu et al., 2020). Therefore, the implementation of B2B e-commerce will not only bring many benefits to the company but also allow the company to get greater opportunities to achieve efficiency and effectiveness as the company's advantages. For this reason, there is a need for research on the success factors for developing B2B e-commerce in Indonesia. Proceedings of the 11th Annual International Conference on Industrial Engineering and Operations Management Singapore, March 7-11, 2021 © IEOM Society International 547

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Identification of Success Factor for B2B E-Commerce in Indonesia

Lalita Padmapuspita J, Rahmat Nurcahyo & Djoko Sihono Gabriel

Industrial Engineering Departement Universitas Indonesia

Depok 16436, Indonesia [email protected] ; [email protected] ; [email protected]

Abstract

The potential of B2B e-commerce is very promising with the development of information and communication technology nowadays. So far there have been several B2B e-commerce players trying to work on the Indonesian market. The competition occurs among B2B e-commerce platform providers to fight for the potential of the B2B market in Indonesia which is still classified as “green” with various challenges faced. This research was conducted to identify the success factors of B2B e-commerce market in Indonesia by developing a questionnaire and implementing pairwise comparison matrix. The pairwise comparison matrix is used to determine the success factor for B2B e-commerce industry in Indonesia. The result is infrastructure IT is the most important success factor in developing B2B e-commerce in Indonesia and government support is the least success factors in developing B2B e-commerce in Indonesia. Keywords: B2B, E-Commerce, Competitive strategy, Pairwise comparison matrix 1. Introduction Information and communication technology have brought many significant changes in today's business world. With the rapid advancement of information and communication technology, it is possible to use the internet as a business tool to gain a greater competitive advantage by reaching a wider global market. In addition, ease of transaction and increased efficiency are among the most important things that can also be obtained by advances in information and communication technology. One of the things that is most felt by the development of information and communication technology is the explosion of digital business, especially in Indonesia, which is supported by the growing variety of e-commerce. However, the more widely known e-commerce models are the B2C (business to customer) and C2C (customer to customer) models. In fact, the B2B (business to business) model sector also has considerable potential. The potential of B2B e-commerce is targeting corporations, MSMEs, and other business actors. According to the DailySocial survey, 57.3% of 2000 respondents are familiar with the term B2B e-commerce and 36.36% of them or around 727 respondents have used this service. B2B e-commerce is concerned with systems and processes that support the flow of information between organizations from procurement, manufacturing, research and development, sales, and distribution of goods, information and services (Collier et al., 2003). Developing a business through B2B e-commerce can obtain several advantages such as reducing transaction costs because it can eliminate intermediaries, identify new markets, improve intra and inter-organizational communication, build better relationships with suppliers, and have more opportunities to have a wider business field with other big companies (Nirwan & Dhewanto, 2015). The development of B2B e-commerce will change not only procurement teams but goods and service providers to work more efficiently. A successful B2B platform not only allows buyers to access richer market information and reduces overall procurement costs by effectively searching and finding sellers who offer a wide variety of essential goods and services, but also enables sellers to reduce marketing and communication costs and by easier and access more buyers efficiently (Liu et al., 2020). Therefore, the implementation of B2B e-commerce will not only bring many benefits to the company but also allow the company to get greater opportunities to achieve efficiency and effectiveness as the company's advantages. For this reason, there is a need for research on the success factors for developing B2B e-commerce in Indonesia.

Proceedings of the 11th Annual International Conference on Industrial Engineering and Operations Management Singapore, March 7-11, 2021

© IEOM Society International 547

1.1 Objectives In Wang et al. (2012) explained that the success of B2B e-commerce in China is influenced by organizational capabilities and market opportunities. Other strategic factors that influence the success of B2B e-commerce are integration, value proposition, leadership participation, revenue models, branding and reputation, and complete service content (Johnson, 2013). Thatcher et al. (2006) stated that culture is one of the factors influencing the adoption of B2B e-commerce in Taiwan where the nature of cultural influence is determined by the state's industrial conditions. Developing countries are often faced with several problems in adopting an e-business model, such as lack of e-business policies and regulations, inadequate infrastructure, trust and security (Janita & Chong, 2013). Kurnia et al. (2015) summarizes that there are three contexts that influence the adoption of B2B e-commerce in Indonesia. However, studies that discuss the factors to able to successfully implement B2B e-commerce, especially in Indonesia, are still very limited even though the B2B e-commerce market in Indonesia is very promising. With the development of technology, internet consumption has become increasingly segmented and one of the growing segments is the business to business (B2B) e-commerce market. So far there have been several B2B e-commerce players who are trying to work on the Indonesian market. According to the survey results, it is known that Bhinneka is the most widely used e-commerce B2B platform (56.87%), then Bizzy (33.24%), and MBiz (9.89%). This research was conducted to identify the success factors to develop B2B e-commerce in Indonesia. This research is expected to provide benefits for B2B e-commerce business players in making proper planning. 2. Literature Review 2.1 E-Commerce Since its first popularity in the 1990s, electronic commerce (e-commerce) has revolutionized business. Major changes in industrial competitiveness and structure occurred due to the introduction of e-commerce (Chang Shia et al., 2015). The growth of the World Wide Web (Web) exploded since the 2000s coupled with the rapid expansion of public access, has supported the practice of doing business online and attracted a lot of attention from entrepreneurs, executives, and investors (Liao et al., 2006). The definition of e-commerce or electronic commerce is the process of exchanging information and transactions involving goods and services using information technology (Febriantoro, 2018). E-commerce refers to the purchase or ordering of goods via the Internet for personal or household consumption of consumers, regardless of whether an invoice for payment comes later or the goods are paid for immediately via electronic banking, credit card, electronic payment or the like (Lignell, 2014). Mahadevan (2000) in his research shows that the business model on the internet is a unique blend of three important streams for business: the flow of value for business partners and buyers, the flow of income, and the flow of logistics. Value flows identify value propositions for buyers, sellers, and market makers as well as portals in the context of the internet. A revenue stream is a plan to ensure revenue growth for a business. Logistics flow addresses various issues associated with supply chain design for businesses. E-commerce business models or electronic commerce in general can be categorized into the following categories: B2B (Business to Business), B2C (Business to Consumer), C2C (Consumer to Consumer), and B2G (Business to Government) (Chang Shia et al., 2015). 2.2 B2B E-Commerce B2B e-commerce is defined as a supply chain innovation that results in the integration of cross-company processes including electronic data exchange (EDI) and Web and Internet-based applications (Claycomb et al., 2005) using the World Wide Web to secure trade in goods, information and services before, during, and after the sale (Barnes-Vieyra & Claycomb, 2001). B2B e-commerce as an inter-organizational information system that allows buyers and sellers who participate in certain markets to exchange information about prices and product offerings, thereby matching them, facilitating the exchange of information, goods, services and payments and providing an institutional infrastructure that enables the efficient functioning of markets (Castro-Lacouture et al., 2007). B2B e-commerce is a process of applying information and communication technology to support the entire value chain from suppliers through companies to customers (Thatcher et al., 2006). B2B e-commerce business is a business that offers to sell or buy goods and services to other business entities (Febriantoro, 2018). Summarizing the research conducted by Tan (2013), there are three factors why B2B e-commerce is so important, namely:

Proceedings of the 11th Annual International Conference on Industrial Engineering and Operations Management Singapore, March 7-11, 2021

© IEOM Society International 548

1) Most customers want convenience and speed: Competition among companies has changed from previously product-centered to customer-centered in order to attract more customers who buy products. Today, buyers can easily get products through the market, forcing companies to face serious challenges to win the competition by meeting customer needs.

2) Satisfactory service with integration: With integrated data through Enterprise Resources Planning (ERP) where information about product types, prices and stocks can be shared and viewed by customers, it has made it easier for companies to serve customers.

3) E-commerce operating platform: Customer attention demands higher e-commerce performance and it is recommended that the e-commerce operating platform provides stronger business functions to ward off serious business changes. Therefore, there are several ways to achieve higher e-commerce performance, such as 1). Rich Internet Application (RIA) which functions as a support for business operations, 2). Business to Customers (B2C) and Business to Business (B2B) which provide a shop interface, 3). A tool for loading stable data adopting generally accepted standards by the industry with special requirements. 4). Making services to collaborate data with third party source services in the form of statistical data for decision making.

B2B e-commerce has changed the way transactions are cross-company resulting in lower costs and better supply chain management. E-commerce expands the spectrum of buyers. In addition, e-commerce provides sellers opportunities to acquire new customers, broadens the options available to buyers, and reduces transaction costs by pooling large numbers of buyers and sellers and automating transactions. In particular, B2B e-commerce fosters: flexibility of choice in the market, a wider choice of supply chain partners; faster decision making, time to market, and transactions; increase efficiency and productivity due to reduced administrative processes, elimination of bureaucratic systems, better inventory control; and instant responses to unexpected problems and opportunities (Claycomb et al., 2005). In recent years, many companies have undergone major transformations in an effort to reduce costs and provide better service to customers. The entire value chain between the company and its customers and suppliers is reviewed and reengineered. In addition, the increasingly globalization of products and companies has created a need for cross-border inter-organizational relationships that rely on B2B e-commerce systems (Thatcher et al., 2006). The following are some of the success factors that the authors summarize in Table 2.1 below.

Table 1. Summary of literature review Characteristics and Success

Factors Details Source

Security of the system and trust

Internet transaction security and trust are the most important that affects the success of B2B e-commerce

Turban et al. (2000); Harland et al. (2007); Li & Li (2005)

Top management support The involvement of senior management has a significant impact on the success of B2B e-commerce implementation

Janita & Chong (2013); Mohtaramzadeh et al. (2018); Thatcher et al. (2006); Johnson (2013)

IT Infrastructure -include feature and integration

B2B e-commerce can support the entire level of B2B activities from procure to pay process in the platform

Janita & Chong (2013); Alsaad et al. (2014); Johnson (2013); Tan (2013); Li & Li (2005)

Social and cultural consideration

Social and culture are the key factors for B2B e-commerce implementation

Mohtaramzadeh et al. (2018); Vatanasakdakul et al. (2004); Alsaad et al. (2014); Thatcher et al. (2006);

Government Support Government regulation will affect the implementation of B2B e-commerce

Janita & Chong (2013); Mohtaramzadeh et al. (2018); Thatcher et al. (2006);

Successful customer relationships

The integration between B2B e-commerce with customer relationship management (CRM) to increase customer loyalty and retention

Xuhua et al. (2019); Li & Li (2005)

Proceedings of the 11th Annual International Conference on Industrial Engineering and Operations Management Singapore, March 7-11, 2021

© IEOM Society International 549

Marketing and branding The marketing and branding strategy to bring awareness of the importance of B2B e-commerce

Iankova et al. (2019); Johnson (2013)

2.3 Competitive strategy Every company involved in the industrial world must have a competitive strategy, either clearly or implicitly. This strategy is built through several planning processes and develops through activities or activities carried out in each division of the company. This strategy is maintained and implemented jointly in each division of the company so that coordination between divisions goes towards the same goal. Some companies use other terms of competitive strategy, such as "mission" or "objective" rather than "goals". Porter (1980) describes competitive strategy as taking offensive or defensive action to create a defensible position in an industry, in order to successfully overcome the five competitive forces and thus produce a superior return on investment for the firm. His research concluded that there are three general strategic approaches that have the potential to succeed in outperforming other companies in an industry, namely: cost advantage, differentiation, and focus. The essence of formulating a competitive strategy is to have a description of the relationship between the company and its environment. Although the relevant environment is very broad, including social and economic forces, a key aspect of the corporate environment is the industry or industries in which the company competes. The industrial structure has a considerable influence in determining potential strategies for the company. In addition, forces outside the industry also have a large and significant influence because their extraordinary powers affect all companies in the industry, the key is found in the different abilities of the companies to deal with them. The objective of a competitive strategy for a business unit in an industry is to find a position in the industry where the company can defend itself well against these competitive forces or can influence those competitive forces to benefit it. The key to developing a strategy is to dig deeper beyond the surface and analyze the sources of each. As mentioned by some research, analysis of external factors and internal factors are crucial in strategy making process. The external factors include competition, economic impact, social cultural demographic, political, natural environment, technological change, trends, and market share. The internal factors include management team, organization structure and culture, distinctive competency, competitive advantage, operations, marketing, human re- sources, finance & accounting, information tech/system, R&D (Nurcahyo, Akbar, et al., 2018). 2.4 Pairwise Comparison Method In the various areas of the evaluation, selection, and prioritization process, the decision maker tries to find the best alternative from several viable alternatives. In many cases, it is not possible to compare various alternatives using only one criterion or a single decision maker. Decision-making is determined to combine opinions about relevant alternatives from different points of view. These procedures are often based on pairwise comparisons, meaning that processes are associated with multiple levels of preference for one alternative over another. Pairwise comparison is the process of comparing paired entities to assess which entity is preferred, or has a greater number of quantitative properties, or whether the two entities are identical or not (Ramík, 2020). Pairwise comparisons have been widely used in many decision-making approaches such as Analytical hierarchy process (AHP). Analytical hierarchy process (AHP) is a multi-criteria decision analysis method to help decision makers face complex problems with multiple conflicts and subject criteria (Riahi & Moharrampour, 2016). This method was developed by Professor Thomas Saaty in 1980. This method is used for decision making and is widely applied in many fields such as economics, social sciences and management. AHP is an effective tool for dealing with complex decision making, and it can help decision makers to set priorities and make the best decisions. AHP helps to determine subjective and objective aspects of a decision (Erdil & Erbıyık, 2015). One of the benefits of the AHP method is that it gives weight to predetermined criteria. Analytical hierarchy process (AHP) is a multi-criteria decision analysis method to help decision makers face complex problems with multiple conflicts and subject criteria (Riahi & Moharrampour, 2016). This method was developed by Professor Thomas Saaty in 1980. This method is used for decision making and is widely applied in many fields such as economics, social sciences and management. AHP is an effective tool for dealing with complex decision making,

Proceedings of the 11th Annual International Conference on Industrial Engineering and Operations Management Singapore, March 7-11, 2021

© IEOM Society International 550

and it can help decision makers to set priorities and make the best decisions. One of the benefits of the AHP method is that it gives weight to predetermined criteria. AHP aims to present criteria and alternatives in the form of a hierarchy that describes a problem. Based on the research of Nurcahyo, Wardhani, et al. (2018) the strategic formulation, especially when determine the strategic priorities, can be done by using AHP method with the following steps: (1) define the problem; (2) design the hierarchy structure; (3) Construct a set of pairwise comparison matrix; (4) Normalization of the data matrix; (5) Consistency test. The scale used is the scale proposed by Saaty (1980). In this method, the level of importance of the criteria is compared with the saaty scale. The assessment is then described in the form of a multiple comparison matrix. The matrix was normalized to obtain a weight for each criterion. The weight can be measured by the equation:

𝑤𝑤 = 𝑛𝑛𝑗𝑗=1 𝑎𝑎𝑖𝑖𝑗𝑗

𝑛𝑛 (2.1)

𝑤𝑤 = �𝑤𝑤1,𝑤𝑤2,𝑤𝑤3, …𝑤𝑤𝑛𝑛 �;𝑛𝑛 = 𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛 𝑜𝑜𝑜𝑜 𝑐𝑐𝑛𝑛𝑐𝑐𝑐𝑐𝑛𝑛𝑛𝑛𝑐𝑐𝑐𝑐 One of the advantages is the consistency test to calculate the consistency of the assessment. This aims to prevent bias and inconsistencies in the assessment. The first step to perform a consistency test is to calculate the eigen value with equation 2.2 below:

𝑨𝑨𝑨𝑨 = 𝝀𝝀𝑨𝑨 (2.2)

𝜆𝜆 = 𝜆𝜆1, 𝜆𝜆2, 𝜆𝜆3, … , 𝜆𝜆𝑛𝑛 = 𝑛𝑛𝑐𝑐𝑒𝑒𝑛𝑛𝑛𝑛 𝑣𝑣𝑐𝑐𝑣𝑣𝑛𝑛𝑛𝑛 Then, after all the eigenvalues for each row are calculated, then the maximum eigenvalues are calculated with the consistency index with equations 2.3 and 2.4.

𝜆𝜆𝑚𝑚𝑚𝑚𝑚𝑚 = 𝑛𝑛𝑖𝑖=1 𝜆𝜆𝑖𝑖𝑛𝑛

(2.3)

𝐶𝐶𝐶𝐶 = 𝜆𝜆𝑚𝑚𝑎𝑎𝑚𝑚−𝑛𝑛𝑛𝑛−1

(2.4)

Furthermore, the consistency ratio is calculated using the equation 2.5 below: 𝐶𝐶𝐶𝐶 = 𝐶𝐶𝐶𝐶

𝑅𝑅𝐶𝐶 (2.5)

CR = Consistency Ratio CI = Consistency Index RI = Random Index 3. Research Methodology This research is intended to analyze and map strategies that can be taken and implemented for the development of B2B e-commerce in Indonesia by determining the success factors that affect B2B e-commerce company in Indonesia using the pairwise method. The research methodology consists of several stages which will be carried out as follows: 1) Literature Study From the summary of the success factors for developing B2B e-commerce in Table 1 which consists of seven factors, the authors use these seven factors as variables in this study to be able to find out the priority between factors according to the B2B e-commerce company which can be seen in Table 2.

Table 2. Success Factors Calculation Symbol Symbol Factor Explanation

A Security of the system and trust The extent to which the security system and customer’s trust

affect the success of B2B e-commerce in Indonesia

B Top management support The extent to which management support affects the success

of B2B e-commerce in Indonesia

Proceedings of the 11th Annual International Conference on Industrial Engineering and Operations Management Singapore, March 7-11, 2021

© IEOM Society International 551

C IT Infrastructure The extent to which information technology infrastructure

affects the success of B2B e-commerce in Indonesia

D Social and cultural consideration The extent to which social and cultural influences the success

of B2B e-commerce in Indonesia

E Government Support The extent to which government support affects the success of

B2B e-commerce in Indonesia

F Successful customer relationships The extent to which customer service affects the success of

B2B e-commerce in Indonesia

G Marketing and branding The extent to which marketing and branding affect the success

of B2B e-commerce in Indonesia

2) Data Collecting and Processing At this stage a research questionnaire was distributed to the big five B2B e-commerce companies in Indonesia. The result of the questionnaire is that the manager gives a priority. The priority is composed of the numbers 1 to 9 in each value. These numbers will describe the dominant interest level of the comparison strategy. The next step is to convert the matrix to decimal form and use the geometric mean to calculate the perception of the respondent. This is the result calculated using geomean in Table 3.

Table 3. The Result of Calculation AHP Questionnaire using Geomean Criteria A B C D E F G

A 1.00 1.33 0.49 0.93 1.12 0.43 1.18 B 0.75 1.00 0.35 1.16 2.04 0.72 0.42 C 2.04 2.86 1.00 1.72 5.52 1.18 1.12 D 1.07 0.86 0.58 1.00 1.47 0.52 0.55 E 0.89 0.49 0.18 0.68 1.00 0.29 0.27 F 2.30 1.38 0.85 1.94 3.51 1.00 1.38 G 0.84 2.37 0.89 1.81 3.76 0.72 1.00 Σ 8.90 10.29 4.34 9.24 18.42 4.87 5.93

Table 4. Normalization Eigen Vector

Criteria A B C D E F G Priority Vector Eigen Value A 0.112 0.129 0.113 0.101 0.061 0.089 0.200 0.806 7.225 B 0.084 0.097 0.081 0.126 0.111 0.149 0.071 0.719 7.185 C 0.229 0.278 0.230 0.186 0.300 0.243 0.190 1.656 7.255 D 0.121 0.083 0.134 0.108 0.080 0.106 0.093 0.726 7.189 E 0.100 0.048 0.042 0.073 0.054 0.059 0.045 0.421 7.183 F 0.259 0.134 0.195 0.210 0.190 0.205 0.233 1.426 7.206 G 0.095 0.230 0.205 0.196 0.204 0.149 0.169 1.248 7.240

𝜆𝜆max 7.212

Furthermore, the maximum eigen value, consistency index (CI), consistency ratio (CR) is calculated with equations 2.3, 2.4, 2.5. The random index (RI) value can be seen in Table 5. The result is considered consistent if it has a CR value of less than 0.1 or 10%.

Proceedings of the 11th Annual International Conference on Industrial Engineering and Operations Management Singapore, March 7-11, 2021

© IEOM Society International 552

Table 5. Random Index (RI) N 1 2 3 4 5 6 7 8 9 10 11 RI 0.00 0.00 0.58 0.90 1.12 1.24 1.32 1.41 1.45 1.49 1.51

Calculate CI (Consistency Index) 𝐶𝐶𝐶𝐶 = 𝜆𝜆𝑚𝑚𝑎𝑎𝑚𝑚−𝑛𝑛

𝑛𝑛−1= 7.212 − 7

7−1= 0.035313

Calculate CR (Consistency Ratio) with 7 criteria (n = 7)

𝐶𝐶𝐶𝐶 = 𝐶𝐶𝐶𝐶𝐶𝐶𝐶𝐶

=0.035313

1.32= 0.02675

The result of the Consistency Ratio has value < 0.100 so the assessment of the respondents each of the criteria is consistent and can be used in this research. Then, the criteria are ranked from the most influential factors to the least influential in the Table 6.

Table 6. Criteria Rank Criteria Value Rank

C IT infrastructure 1.66 1 F Successful customer relationships 1.43 2 G Marketing and branding 1.25 3 A Security of the system and trust 0.81 4 D Social and cultural consideration 0.73 5 B Top management support 0.72 6 E Government support 0.42 7

4. Result and Discussion Literature study was conducted to know the characteristics of the strategies used and the success factors that affect the B2B e-commerce market. As you can see in the Table 1 characteristics and the success factors that affect the B2B e-commerce. Using Pairwise comparison method to get weight for each criterion that affect the success factor of B2B e-commerce in Indonesia. The most influential factor is IT infrastructure. B2B e-commerce have to support from procure to process in the platform seamlessly. That will attract the customer to using B2B e-commerce because it will ease their work and increase their productivity. IT infrastructure closely related to feature and integration that available in the B2B e-commerce that support the needs from procure to pay. This research also send questionnaire to 60 Procurement/Purchasing/Buyer in different industry. The questionnaire consists of question to sorting from 1 (most important) until 8 (least important) for the features that they think are the most important that should be in B2B e-commerce. The result show as you can see in the Table 7.

Table 7. Rank of the most important feature until least important in B2B e-commerce

Feature Rank Percentage

Respondents that Choose

Supplier Rating 1 40% Price Comparison 2 30% Order & Fulfilment Management Tracking 3 27% Spending Report & Analytics 4 20% Contract Management 5 23% ERP Integration 6 18% Business Catalogue 7 25% Approval Workflow 8 40%

Proceedings of the 11th Annual International Conference on Industrial Engineering and Operations Management Singapore, March 7-11, 2021

© IEOM Society International 553

The rank based on the most respondent that choose the feature in each rank. As you can see in Table 7 that the top 3 most important feature is supplier rating, price comparison, and order & fulfilment tracking. The needs to know the supplier rating is to know that they engaged with reliable supplier. In the tendering process, price comparison is also important to compare the quotation from at least three or more suppliers. As mentioned before that B2B e-commerce need to be support procure to pay process seamlessly in the platform, order and fulfilment management tracking is important to make sure that from procure goods/service until the payment is can be done in the platform. Priority number 2 beside the IT infrastructure is successful customer relationship. This includes the collaboration between buyer and seller in the platform and also B2B e-commerce customer support in handling the issues faced by buyer or seller. As (Li & Li, 2005) mentioned in their research the e-commerce is not a technology interaction platform supported by participants, but a way of interaction between participants supported by technology. Since the B2B e-commerce is still quite uncommon in our daily life, strategy marketing and branding is important, number 3 priority criteria that affect the successful of B2B e-commerce. Customer especially buyer will be selling their goods/service in the B2B e-commerce platform if the branding name of the B2B e-commerce is well-known and have a good reputation. When seller is attracted in the B2B e-commerce, the buyer will also use the B2B e-commerce that has many choices of sellers. Security of the system and trust is the next criteria that effect of the successful B2B e-commerce in Indonesia. One of the important area that affect the successful implementation of international marketing is transaction security (Eid et al., 2002). Social and cultural consideration is next to affect the successful of B2B e-commerce in Indonesia. To turn the culture from offline to online is not quite simple. B2B e-commerce companies should pay attention to use combination strategies between online and offline models when designing the strategies. They need to consider social and culture to turn most of the offline process into online process convincingly. The least 2 criteria that affect the successful of B2B e-commerce in Indonesia is top management support and government support. With a better understanding of the critical success factors in B2B e-commerce, management will be able to make critical decisions and allocate the resources to make the B2B e-commerce implementation a success. Besides the quantitative method, we also suggest using a qualitative method to explore more about the strategy that has been implemented by B2B e-commerce providers and the expectations of the services/goods providers companies in Indonesia. 5. Conclusion The B2B e-commerce industry become interesting object to research. With the development of the platform in Indonesia and the competition between B2B e-commerce provider, we find it important to identify the success factors for B2B e-commerce in Indonesia. To identify the success factors, we use pairwise comparison matrix and design the Hierarchy problem. The pairwise comparison matrix will identify the percentage of the success factor based on view from B2B e-commerce providers. The result shows that the factors affecting the success of B2B e-commerce in Indonesia from the most important to the least important are IT infrastructure, successful customer relationships, marketing and branding, security system and trust, social and cultural consideration, top management support, and government support. We also suggest doing the open question (qualitative method) while doing the quantitative interview to deep down the strategy that has been used from B2B e-commerce providers and the expectation of users. References Alsaad, A. K. H., Mohamad, R., & Ismail, N. A. (2014). The Moderating Role of Power Exercise in B2B E-

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Biographies Lalita Padmapuspita is a magister student in Industrial Engineering at Universitas Indonesia. She earned bachelor’s degree in metallurgy and materials engineering at University of Indonesia. She is currently working at one of the big e-commerce in Indonesia. Rahmat Nurchayo is a Professor in Industrial Engineering. Universitas Indonesia. He earned Bachelor of Engineering degree in Mechanical Engineering from Universitas Indonesia, a Master of Engineering Science degree in Industrial Management from University of New South Wales, Australia and Doctoral degree in Strategic Management from Universitas Indonesia. His research interest in total quality management, production system, lean system and maintenance management. His research interests include management system and business management. Djoko Sihono Gabriel is a Professor in Industrial Engineering, Universitas Indonesia. He got the Bachelor of Engineering (B. Eng.) in Industrial Engineering, Bandung Institute of Technology, Bandung, Indonesia in 1980, the engineer (Ir.) in Industrial Engineering, Bandung Institute of Technology, Bandung, Indonesia in 1981, the Master of Engineering (M. Eng.) in Industrial Management, Universitas Indonesia, Jakarta, Indonesia in 1995, the doctor (Dr.) in mechanical engineering, Universitas Indonesia, Jakarta, Indonesia in 2015.

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