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Adoption of Information Technology on Small Businesses: The Role of Environment, Organizational and Leader Determinant

Leader, organizational and environment determinants for small businesses have important roles in making decision to adopt information technology (IT). The purpose of this research is examine effects of leader determinants (leader innovativeness and level of leaderIT knowledge), organizational determinants (business size, level of employees' knowledge IT, information intensity) and environment factor to decision to adopt information technology. A survey was conducted in Yogyakarta city by purposive sampling technique. The samples that are 102 small business. Partial Least Squares method was used to examine five research hypotheses. Research instrument validity was measured by convergent validity and discriminant validity. Instrument reliability was measured by cronbach's alpha and composite reliability. This research shows that leader' IT knowledge, firm size, and information intensity have significantly positive effect on the decision of small businesses to adopt IT. On the other hand leader innovativeness, employees' IT knowledge and competitive have no effect to small businesses decision to adopt IT.