A taxonomy of blockchain technology application and adoption by small and medium-sized enterprises
DOI:
https://doi.org/10.15678/EBER.2024.120308Abstract
Objective: The objective of the article is to comprehensively examine the application and adoption of blockchain technology in SMEs. Recently, blockchain technology has garnered substantial attention owing to its transformative potential across diverse industries. Blockchain represents a decentralized and distributed ledger system that ensures data transparency, security, and immutability. This unique set of attributes has garnered attention from various sectors, ranging from finance and healthcare to supply chain and beyond. While predominant attention has been directed towards its impact on large corporations and financial institutions, the application and adoption of blockchain technology in small and medium-sized enterprises (SMEs) remains a relatively unexplored area.
Research Design & Methods: This research utilized a narrative and critical literature review of the existing literature on blockchain technology and SMEs.
Findings: We identified the key areas of application and drivers and barriers to SMEs’ adoption of blockchain technology. Supply chain and finance have emerged as primary domains witnessing heightened blockchain implementation. The intricate nature of supply chain operations involving a multitude of stakeholders and the centralized nature of financing with inherent information asymmetry have propelled blockchain adoption within these sectors. However, the complex nature of technology, regulatory uncertainty, and lack of technological capabilities of SMEs have been the barriers inhibiting the widespread adoption of blockchain technology in SMEs.
Implications & Recommendations: The insights derived from this study can facilitate the successful design and implementation of blockchain-based solutions for SMEs. Blockchain solution providers must understand and tailor the solutions to SMEs. Blockchain-as-a-service (BaaS) can accelerate flexible application development, expediting blockchain integration in SMEs. Government, regulatory bodies, and SME groups are urged to collaborate in enhancing technological literacy among SMEs, facilitating their capacity to harness the advantages offered by blockchain technology.
Contribution & Value Added: This research contributes to the field by shedding light on the underexplored realm of blockchain technology in SMEs. The created taxonomy, examination of adoption drivers and barriers, and the formulated opportunities-challenges framework provide valuable tools for understanding and navigating blockchain technology’s application and adoption-related challenges in SMEs. The identified gaps and proposed areas for future research further contribute to the ongoing discourse in this evolving field.
Keywords
Blockchain technology, small and medium-sized enterprises (SMEs), Taxonomy, Application, adoption
References
- Adams, D., Donovan, J., & Topple, C. (2021). Achieving sustainability in food manufacturing operations and their supply chains: Key insights from a systematic literature review. Sustainable Production and Con-sumption, 28, 1491-1499. https://doi.org/10.1016/J.SPC.2021.08.019
- Akpan, I.J., Udoh, E.A.P., & Adebisi, B. (2022). Small business awareness and adoption of state-of-the-art technologies in emerging and developing markets, and lessons from the COVID-19 pandemic. Journal of Small Business & Entrepreneurship, 34(2), 123-140. https://doi.org/10.1080/08276331.2020.1820185
- Ali, M.H., Chung, L., Kumar, A., Zailani, S., & Tan, K.H. (2021). A sustainable Blockchain framework for the halal food supply chain: Lessons from Malaysia. Technological Forecasting and Social Change, 170, 120870. https://doi.org/10.1016/J.TECHFORE.2021.120870
- Ante, L. (2020). Blockchain-based tokens as financing instruments: Capital market access for SMEs? In Foster-ing Innovation and Competitiveness with FinTech, RegTech, and SupTech (pp. 129-141). https://doi.org/10.4018/978-1-7998-4390-0.ch007
- Anwar, S. (2019). Use of blockchain technology (Smart contract) for small and medium enterprises sector to increase transparency and reduce default rates. Journal of Advanced Research in Dynamical and Control Systems, 11(6 Special Issue), 1730-1737.
- Bag, S., Viktorovich, D.A., Sahu, A.K., & Sahu, A.K. (2021). Barriers to adoption of blockchain technology in green supply chain management. Journal of Global Operations and Strategic Sourcing, 14(1). https://doi.org/10.1108/JGOSS-06-2020-0027
- Barenji, A.V., Li, Z., Wang, W.M., Huang, G.Q., & Guerra-Zubiaga, D.A. (2019). Blockchain-based ubiquitous manufacturing: a secure and reliable cyber-physical system. Journal of Manufacturing Science and Engi-neering, 58(7), 2200-2221. https://doi.org/10.1080/00207543.2019.1680899
- Bhardwaj, A.K., Garg, A., & Gajpal, Y. (2021). Determinants of Blockchain Technology Adoption in Supply Chains by Small and Medium Enterprises (SMEs) in India. Mathematical Problems in Engineering, 2021. https://doi.org/10.1155/2021/5537395
- Block, J.H., Groh, A., Hornuf, L., Vanacker, T., & Vismara, S. (2021). The entrepreneurial finance markets of the future: A comparison of crowdfunding and initial coin offerings. Small Business Economics, 57(2). https://doi.org/10.1007/s11187-020-00330-2
- Casino, F., Dasaklis, T.K., & Patsakis, C. (2019). A systematic literature review of blockchain-based applica-tions: Current status, classification and open issues. Telematics and Informatics, 36, 55-81. https://doi.org/10.1016/J.TELE.2018.11.006
- Chabani, Z., Hamouche, S., & Said, R. (2021). Is Blockchain Technology Applicable in Small and Medium-Sized Enterprises?. Lecture Notes in Networks and Systems, 211, 505-514. https://doi.org/10.1007/978-3-030-73882-2_46
- Chang, S.E., & He, S.Y. (2018). Exploring blockchain technology for capital markets: a case of angel fund. In Proceedings of the IEEE 2018 International Congress on Cybermatics (pp. 1941-1948). https://doi.org/10.1109/Cybermatics_2018.2018.00321
- Clohessy, T., & Acton, T. (2019). Investigating the influence of organizational factors on blockchain adoption: An innovation theory perspective. Industrial Management. Data Systems, 119(7), 1457-1491. https://doi.org/10.1108/IMDS-08-2018-0365
- Crosby, N., Pradan, P., Pattanayak, S., Verma, M., & Kalyanaraman, V. (2016). BlockChain Technology: Beyond Bitcoin.
- Dana, L.-P., Salamzadeh, A., Mortazavi, S., & Hadizadeh, M. (2022). Investigating the Impact of International Markets and New Digital Technologies on Business Innovation in Emerging Markets. Sustainability, 14(2), 983. https://doi.org/10.3390/su14020983
- Davis, F.D. (1986). A Technology Acceptance Model for Empirically Testing New End-User Information Systems: Theory and Results. Sloan School of Management, Massachusetts Institute of Technology.
- Desai, S., Deng, Q., Wellsandt, S., & Thoben, K.D. (2019). An Architecture of IoT-Based Product Tracking with Blockchain in Multi-sided B2B Platform. IFIP Advances in Information and Communication Technology, 566. https://doi.org/10.1007/978-3-030-30000-5_57
- Di Giuda, G.M., Giana, P.E., & Pattini, G. (2020). The shortening and the automation of payments: The po-tentiality of smart contract in the aeco sector. Proceedings of International Structural Engineering and Construction, 7(2), CON-12-1-CON-12-6. https://doi.org/10.14455/ISEC.2020.7(2).CON-12
- Dimitropoulos, P., Koronios, K., Thrassou, A., & Vrontis, D. (2020). Cash holdings, corporate performance and viability of Greek SMEs: Implications for stakeholder relationship management. EuroMed Journal of Business, 15(3), 333-348. https://doi.org/10.1108/EMJB-08-2019-0104
- Dutta, S., & Saini, K. (2021). Statistical Assessment of Hybrid Blockchain for SME Sector. https://doi.org/10.37394/23203.2021.16.6
- Faasolo, M.B., & Sumarliah, E. (2022). An Artificial Neural Network Examination of the Intention to Imple-ment Blockchain in the Supply Chains of SMEs in Tonga. Information Resources Management Journal, 35(1). https://doi.org/10.4018/IRMJ.287907
- Feng, Y., & Wang, Y. (2022). Easing effect of supply chain finance constraints based on blockchain technolo-gy. In Proceedings of the International Conference on Business Process Management (BPM), 12008, 560-570. https://doi.org/10.1007/978-3-030-89508-2_41
- Genta, G., Villa, A., & Perrone, G.P. (2021). Supply Chain Management by Blockchain. In IFIP Advances in Information and Communication Technology, 632 IFIP, 480-488. https://doi.org/10.1007/978-3-030-85906-0_53
- Gerasimova, V., Philipp, R., & Prause, G. (2021). Service Design for Trans-National Smart Supply Chains. Lec-ture Notes in Networks and Systems, 195, 377-388. https://doi.org/10.1007/978-3-030-68476-1_35
- Hamdan, I.K.A., Aziguli, W., Zhang, D., Sumarliah, E., & Fauziyah, F. (2021). A machine learning method to predict the technology adoption of Blockchain in Palestinian firms. International Journal of Emerging Markets. https://doi.org/10.1108/IJOEM-05-2021-0769
- Jiang, J., & Chen, J. (2021). Framework of blockchain-supported e-commerce platform for small and medium enterprises. Sustainability, 13(15), 8158. https://doi.org/10.3390/SU13158158
- Karamchandani, A., Srivastava, S.K., Kumar, S., & Srivastava, A. (2021). Analysing perceived role of blockchain technology in SCM context for the manufacturing industry. International Journal of Production Research, 59(11), 3398-3429. https://doi.org/10.1080/00207543.2021.1883761
- Katsikouli, P., Wilde, A.S., Dragoni, N., & Høgh-Jensen, H. (2021). On the benefits and challenges of block-chains for managing food supply chains. Journal of Science Food and Agriculture, 101(6), 2175-2181. https://doi.org/10.1002/JSFA.10883
- Kaur, J., Kumar, S., Narkhede, B.E., Dabić, M., Rathore, A.P.S., & Joshi, R. (2022). Barriers to blockchain adoption for supply chain finance: The case of Indian SMEs. Electronic Commerce Research. https://doi.org/10.1007/s10660-022-09566-4
- Khazaei, H. (2020). Integrating cognitive antecedents to utaut model to explain adoption of blockchain technology among Malaysian SMEs. International. Journal of Informatics Visuals, 4(2), 85-90. https://doi.org/10.30630/joiv.4.2.362
- Kinai, A., Markus, I., Oduor, E., & Diriye, A. (2017). Asset-based lending via a secure distributed platform. ACM International Conference Proceeding Series, Part F132087. https://doi.org/10.1145/3136560.3136594
- Koronios, K., Dimitropoulos, P., Kriemadis, A., Douvis, J., Papaloukas, M., & Ratten, V. (2020). Empowerment and Performance in SMEs: Examining the Effect of Employees’ Ethical Values and Emotional Intelligence, In Leitão, J., Ratten, V., & Barroca, J. (Eds.), A Guide to Planning and Managing Open Innovative Ecosys-tems (pp. 83-98). Emerald Publishing Limited, Leeds. https://doi.org/10.1108/978-1-78973-409-620201007
- Korzynski, P., Mazurek, G., Krzypkowska, P., & Kurasniski, A. (2023). Artificial intelligence prompt engineering as a new digital competence: Analysis of generative AI technologies such as ChatGPT. Entrepreneurial Business and Economics Review, 11(3), 25‐37. https://doi.org/10.15678/EBER.2023.110302
- Kumar, D., Phani, B.V., Chilamkurti, N., Saurabh, S., & Ratten, V. (2023). Filling the SME credit gap: a system-atic review of blockchain-based SME finance literature. Journal of Trade Science, ahead-of-print. https://doi.org/10.1108/JTS-06-2023-0003
- Kumar, S., & Rao, P. (2016). Financing patterns of SMEs in India during 2006 to 2013 – an empirical analysis. Journal of Small Business & Entrepreneurship, 28(2), 97-131. https://doi.org/10.1080/08276331.2015.1132513
- Leelasantitham, A. (2020). A Business Model Guideline of Electricity Utility Systems Based on Blockchain Technology in Thailand: A Case Study of Consumers, Prosumers, and SMEs. Wireless Personal Communi-cations, 115(4), 3123-3136. https://doi.org/10.1007/S11277-020-07202-8
- Li, J., Wang, Y., Li, Y., & Li, Q. (2019). A simple survey for supply chain finance risk management with applica-tions of blockchain. In International Conference on Advanced Computer Science and Information Systems, (pp. 39-49). https://doi.org/10.1007/978-981-15-0864-6_5
- Liu, J., & Jiang, P. (2020). Consortium blockchain-driven decentralized organization and operation for manu-facturing community in social manufacturing. IEEE International Conference on Automation Science and Engineering, 2020-August, 576-581. https://doi.org/10.1109/CASE48305.2020.9216738
- Liu, J., Liu, P., Ou, Z., Zhang, G., & Song, M. (2020). An Inclusive Finance Consortium Blockchain Platform for Secure Data Storage and Value Analysis for Small and Medium-Sized Enterprises. Lecture Notes in Com-puter Science (Including Subseries Lecture Notes in Artificial Intelligence and Lecture Notes in Bioinformat-ics), 12634 LNCS, 419-429. https://doi.org/10.1007/978-3-030-70626-5_44
- Li, Z., Chen, S., & Zhou, B. (2021). Electric Vehicle Peer-to-Peer Energy Trading Model Based on SMES and Blockchain. IEEE Transactions on Applied Superconductivity, 31(8). https://doi.org/10.1109/TASC.2021.3091074
- Liu, L., Li, Y., & Jiang, T. (2023). Optimal strategies for financing a three-level supply chain through blockchain platform finance. International Journal of Production Research, 61(11), 3564-3581. https://doi.org/10.1080/00207543.2021.2001601
- Liu, X., Jiang, Y., Wang, Z., Zhong, R.Y., Cheung, H.H., & Huang, G.Q. (2021). imseStudio: blockchain-enabled secure digital twin platform for service manufacturing. Journal of Manufacturing Science and Engineering, 143(1). https://doi.org/10.1080/00207543.2021.2003462
- Lopez, M.A., Lombardo, J.M., López, M., Alba, C.M., Velasco, S., Braojos, M.A., & Fuentes-García, M. (2020). Intelligent Detection and Recovery from Cyberattacks for Small and Medium-Sized Enterprises. Interna-tional Journal of Interactive Multimedia and Artificial Intelligence, 6(3), 55. https://doi.org/10.9781/IJIMAI.2020.08.003
- Markakis, E.K., Nikoloudakis, Y., Lapidaki, K., Fiorentzis, K., & Karapidakis, E. (2021). Unification of Edge Energy Grids for Empowering Small Energy Producers. Sustainability 2021, 13(15), 8487. https://doi.org/10.3390/SU13158487
- Molati, K., Ilorah, A.I., & Moeti, M.N. (2021). Determinant Factors Influencing the Adoption of Blockchain Across SMEs in South Africa. 2021 15th International Conference on Advanced Technologies, Systems, and Services. https://doi.org/10.1109/TELSIKS52058.2021.9606343
- Nayak, G., & Dhaigude, A.S. (2019). A conceptual model of sustainable supply chain management in small and medium enterprises using blockchain technology. Cogent Economics and Finance, 7(1). https://doi.org/10.1080/23322039.2019.1667184
- Nowiński, W., & Kozma, M. (2017). How Can Blockchain Technology Disrupt the Existing Business Models?. Entrepreneurial Business and Economics Review, 5(3), 173-188. https://doi.org/10.15678/EBER.2017.050309
- Nuryyev, G. et al. (2020). Blockchain technology adoption behavior and sustainability of the business in tourism and hospitality SMEs: An empirical study. Sustainability, 12(3). https://doi.org/10.3390/SU12031256
- Paliwal, V., Chandra, S., & Sharma, S. (2020). Indian MSME’s Sustainable Adoption of Blockchain Technology for Supply Chain Management: A Socio-Technical Perspective. IFIP Advances in Information and Commu-nication Technology, 617, 159-165 https://doi.org/10.1007/978-3-030-64849-7_15
- Petek, I., & Zajec, N. (2018). Collaborative intelligence and decentralized business community building-potentials in food/nutrition sector. Proceedings - IEEE 34th International Conference on Data Engineering Workshops, ICDEW 2018, 150-153. https://doi.org/10.1109/ICDEW.2018.00031
- Pfister, P., & Lehmann, C. (2023). Returns on digitization in SMEs—a systematic literature review. Journal of Small Business & Entrepreneurship, 35(4), 574-598. https://doi.org/10.1080/08276331.2021.1980680
- Philipp, R., Prause, G., & Gerlitz, L. (2019). Blockchain and smart contracts for entrepreneurial collaboration in maritime supply chains. Transport and Telecommunication, 20(4), 1019. https://doi.org/10.2478/ttj-2019-0030
- Poeschl, A. (2023). Longitudinal evidence of entrepreneurial behaviour in a blockchain-based decentralized autonomous organization: Case study of the Nano cryptocurrency. Entrepreneurial Business and Eco-nomics Review, 11(4), 171-185. https://doi.org/10.15678/EBER.2023.110411
- Ran, C., Song, K., & Yang, L. (2020). An improved solution for partner selection of industry-university cooperation. Technology Analysis and Strategic Management, 32(12), 1478-1493. https://doi.org/10.1080/09537325.2020.1786044
- Ratten, V. (2023). Research Methodologies for Business Management (1st ed.). Routledge. https://doi.org/10.4324/9781003314516
- Rhemananda, H., Roulina Simbolon, D., & Fachrunnisa, O. (2021). Blockchain Technology to Support Em-ployee Recruitment and Selection in Industrial Revolution 4.0. Lecture Notes in Networks and Systems, 149. https://doi.org/10.1007/978-981-15-7990-5_30
- Rogers, E.M. (1962). Diffusion of Innovations. Free Press, New York.
- Rotondi, D., & Saltarella, M. (2019). Facing parallel market and counterfeit issues by the combined use of Blockchain and CP-ABE encryption technologies. Global IoT Summit, GIoTS 2019 - Proceedings. https://doi.org/10.1109/GIOTS.2019.8766369
- Rymarczyk, J. (2020). Technologies, Opportunities and Challenges of the Industrial Revolution 4.0: Theoretical Considerations. Entrepreneurial Business and Economics Review, 8(1), 185–198. https://doi.org/10.15678/EBER.2020.080110
- Sadeq, M.J., Rayhan Kabir, S., Akter, M., Forhat, R., Haque, R., & Akhtaruzzaman, M. (2021). Integration of blockchain and remote database access protocol-based database. Advances in Intelligent Systems and Computing, 1184, 533-539. https://doi.org/10.1007/978-981-15-5859-7_53
- Salamzadeh, A., Hadizadeh, M., Rastgoo, N., Rahman, M.M., & Radfard, S. (2022). Sustainability-Oriented Innovation Foresight in International New Technology Based Firms. Sustainability, 14(20), 13501. https://doi.org/10.3390/su142013501
- Sciarelli, M., Prisco, A., Gheith, M.H., & Muto, V. (2021). Factors affecting the adoption of blockchain tech-nology in innovative Italian companies: an extended TAM approach. Journal of Strategic Management. https://doi.org/10.1108/JSMA-02-2021-0054
- Segers, J.P. (2016). Regional systems of innovation: lessons from the biotechnology clusters in Belgium and Germany. Journal of Small Business & Entrepreneurship, 28(2), 133-149. https://doi.org/10.1080/08276331.2015.1128256
- Søgaard, J.S. (2021). A blockchain-enabled platform for VAT settlement. International Journal of Accounting Information Systems, 40. https://doi.org/10.1016/J.ACCINF.2021.100502
- Sun, W., Dedahanov, A.T., Shin, H.Y., & Li, W.P. (2021). Using extended complexity theory to test SMEs’ adoption of Blockchain-based loan system. PLoS One, 16(2), 1-19. https://doi.org/10.1371/JOURNAL.PONE.0245964
- Sun, Y., Zeng, X., Cui, X., Zhang, G., & Bie, R. (2021). An active and dynamic credit reporting system for SMEs in China. Personal and Ubiquitous Computing, 25(6), 989-1000. https://doi.org/10.1007/s00779-019-01275-4
- Tallaki, M., Bracci, E., Ievoli, R., & Diplotti, S. (2020). Knowledge, diffusion, and interest towards blockchain technology in SMEs. 2020 IEEE International Conference on Technology Management, Operation and Deci-sion. https://doi.org/10.1109/ICTMOD49425.2020.9380582
- Utkarsh, P., Saran, H., & Vetrivelan, P. (2022). Loan origination system in the housing sector using block-chain. In A. Sivasubramanian, P.N. Shastry, & P.C. Hong (Eds.), Futuristic Communication and Network Technologies (Vol. 792, pp. 91-105). Springer. https://doi.org/10.1007/978-981-16-4625-6_91
- Venkatesh, V., Morris, M.G., Davis, G.B., & Davis, F.D. (2003). User Acceptance of Information Technology: Toward a Unified View. MIS Quarterly, 27(3), 425-478. https://doi.org/10.2307/30036540
- Wang, H., Zheng, Z., Xie, S., Dai, H.N., & Chen, X. (2018). Blockchain challenges and opportuni-ties: a survey. International Journal of Web and Grid Services, 14(4) 352-375. https://doi.org/10.1504/IJWGS.2018.10016848
- Wang, R., Lin, Z., & Luo, H. (2019). Blockchain, bank credit and SME financing. Quality and Quantity, 53(3), 1127-1140. https://doi.org/10.1007/s11135-018-0806-6
- Xu, L., Yang, Y., & Chu, X. (2021). Research on the influence mechanism of blockchain on the credit of trans-portation capacity supply chain finance. Mathematical Problems in Engineering, 1812096. https://doi.org/10.1155/2021/1812096
- Yang, X. (2021). Blockchain-Based Supply Chain Finance Design Pattern. In Proceedings - 2021 13th Interna-tional Conference on Intelligent Human-Machine Systems and Cybernetics, IHMSC 2021, 200-203. https://doi.org/10.1109/IHMSC52134.2021.00053
- Yu, X. (2021). Blockchain-based supply chain financial services using smart contracts. ACM International Con-ference Proceeding Series. 63-69 https://doi.org/10.1145/3510487.3510497
- Zhang, T., Li, J., & Jiang, X. (2021). Analysis of supply chain finance based on blockchain. Procedia Computer Science, 187(1) 1-6. https://doi.org/10.1016/j.procs.2021.04.025