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Information and communications technology (ICT) offers enormous opportunities for individuals, businesses and society. The application of ICT is equally important to economic and non-economic activities. Researchers have increasingly focused on the adoption and use of ICT by small and medium enterprises (SMEs) as the economic development of a country is largely dependent on them. Following the success of ICT utilisation in SMEs in developed countries, many developing countries are looking to utilise the potential of the technology to develop SMEs. Past studies have shown that the contribution of ICT to the performance of SMEs is not clear and certain. Thus, it is crucial to determine the effectiveness of ICT in generating firm performance since this has implications for SMEs’ expenditure on the technology. This research examines the diffusion of ICT among SMEs with respect to the typical stages from innovation adoption to post-adoption, by analysing the actual usage of ICT and value creation. The mediating effects of integration and utilisation on SME performance are also studied. Grounded in the innovation diffusion literature, institutional theory and resource-based theory, this study has developed a comprehensive integrated research model focused on the research objectives. Following a positivist research paradigm, this study employs a mixed-method research approach. A preliminary conceptual framework is developed through an extensive literature review and is refined by results from an in-depth field study. During the field study, a total of 11 SME owners or decision-makers were interviewed. The recorded interviews were transcribed and analysed using NVivo 10 to refine the model to develop the research hypotheses. The final research model is composed of 30 first-order and five higher-order constructs which involve both reflective and formative measures. Partial least squares-based structural equation modelling (PLS-SEM) is employed to test the theoretical model with a cross-sectional data set of 282 SMEs in Bangladesh. Survey data were collected using a structured questionnaire issued to SMEs selected by applying a stratified random sampling technique. The structural equation modelling utilises a two-step procedure of data analysis. Prior to estimating the structural model, the measurement model is examined for construct validity of the study variables (i.e. convergent and discriminant validity).

The estimates show cognitive evaluation as an important antecedent for expectation which is shaped primarily by the entrepreneurs’ beliefs (perception) and also influenced by the owners’ innovativeness and culture. Culture further influences expectation. The study finds that facilitating condition, environmental pressure and country readiness are important antecedents of expectation and ICT use. The results also reveal that integration and the degree of ICT utilisation significantly affect SMEs’ performance. Surprisingly, the findings do not reveal any significant impact of ICT usage on performance which apparently suggests the possibility of the ICT productivity paradox. However, the analysis finally proves the non-existence of the paradox by demonstrating the mediating role of ICT integration and degree of utilisation explain the influence of information technology (IT) usage on firm performance which is consistent with the resource-based theory. The results suggest that the use of ICT can enhance SMEs’ performance if the technology is integrated and properly utilised. SME owners or managers, interested stakeholders and policy makers may follow the study’s outcomes and focus on ICT integration and degree of utilisation with a view to attaining superior organisational performance.

This study urges concerned business enterprises and government to look at the environmental and cultural factors with a view to achieving ICT usage success in terms of enhanced firm performance. In particular, improving organisational practices and procedures by eliminating the traditional power distance inside organisations and implementing necessary rules and regulations are important actions for managing environmental and cultural uncertainties. The application of a Bengali user interface may help to ensure the productivity of ICT use by SMEs in Bangladesh. Establishing a favourable national technology infrastructure and legal environment may contribute positively to improving the overall situation. This study also suggests some changes and modifications in the country’s existing policies and strategies. The government and policy makers should undertake mass promotional programs to disseminate information about the various uses of computers and their contribution in developing better organisational performance. Organising specialised training programs for SME capacity building may succeed in attaining the motivation for SMEs to use ICT. Ensuring easy access to the technology by providing loans, grants and subsidies is important. Various stakeholders, partners and related organisations should come forward to support government policies and priorities in order to ensure the productive use of ICT among SMEs which finally will help to foster Bangladesh’s economic development.

This paper aims to introduce the Schmid–Leiman solution (SLS) as a useful tool to interpret the results of higher-order factor analyses in marketing research irrespective of the type of higher-order factor structure used (formative or reflective).

Two studies, one with retail shoppers in India and another with undergraduate students in Hong Kong, are used to compare different types of higher-order factor structures to test the utility of SLS.

The authors show that whether a reflective or a formative model is used to operationalize a higher-order construct, using SLS as an additional analysis gives useful insights into the factor structure at different levels and helps isolate their unique contributions to the explained variance.

The authors test higher-order models for store environment and consumer impulsiveness with data from retail shoppers and undergraduate students in two Asian countries, which may restrict the generalizability of the study findings. Future research may try to replicate our findings with other higher-order constructs and consumers in other countries.

The authors offer a checklist that can be used by future researchers to evaluate alternate higher-order factor structures and choose the appropriate one for their research context.

The authors show that using SLS is especially useful when there is a lack of clarity on the nature of relationships between the factors at different levels or about the independent contribution of the factors at different levels, in a higher-order factor structure.

Higher-order factor models have recently been dismissed as a ‘misleading’, ‘meaningless’, and ‘needless’ approach for modeling multidimensional constructs (Lee and Cadogan, 2013; L & C, 2013 hereafter). The purpose of this paper is to show that – in contrast to L & C’s (2013) verdict – higher-order factor models are still a legitimate operationalization option for multidimensional constructs.

Basic conceptual and statistical premises of L & C’s (2013) arguments against higher-order factor models are scrutinized both conceptually and statistically as to their logic and validity.

A thorough analysis of L & C’s (2013) arguments shows that they are fundamentally flawed both conceptually and statistically, rendering their conclusions invalid.

Researchers should not remove the well-established higher-order factor models from their methodological toolkit. Furthermore, empirical findings should not automatically be considered suspect simply because higher-factor models have been used to model multidimensional constructs.

So far, L & C’s (2013) arguments against higher-order factor models have gone unchallenged in the literature. This rejoinder is a first, much needed attempt to protect applied researchers from getting the false impression that by using higher-factor models, they rely on a “misleading” or “meaningless” modeling approach.

Although small and medium sized enterprises (SMEs) account for a significant portion of international trade, little is known about the role of strategic orientation culture in improving their foreign launch success. Three orientations – market, entrepreneurial, and learning are all related to organizational learning priorities and reflect a higher order dynamic capability (DC), proactive learning culture (PLC). The authors assert that PLC is particularly important to SMEs whose lack of market power and resources render them vulnerable in risky foreign market launch. Marketing program adaptation and local integration are examined as behavioral mediators of the impact of PLC on foreign market launch success. The paper aims to discuss these issues.

The DC framework guides the study. The authors employ a model with a higher order PLC, two mediating behaviors, and firm foreign market launch success to report on an empirical study of US SMEs that operate in foreign markets. The authors used hierarchical regression analysis and extensive post hoc analyses/robustness checks.

Consistent with the DC framework, SMEs’ foreign launch success is driven by higher and lower order behaviors. The impact of the higher order PLC construct was mediated by two lower order behaviors, marketing program adaptation and local integration. Notably, PLC's influence is stronger than the influence of any subset of its one/two/three first order components.

SMEs need to pay attention to an array of organizational learning processes that combine to engender a PLC, which help optimize the deployment of more tangible, lower order behaviors required for foreign launch success.

Introducing PLC as a DC that enables firms to proactively develop market-oriented, innovative capabilities using a knowledge-based approach. The elements of PLC reflect a more complete view of the role of learning in driving the assembly of lower order behaviors in foreign market launch, which requires both a market-oriented approach and the ability to innovate under conditions of uncertainty. While each element of PLC is valuable, the higher level impact of all three facilitates a more effective culture for those firms, which choose to enter new markets.

The goal of the paper is twofold. First, it aims to empirically conceptualize whether a wide array of fragmented demand planning activities, performed in supply chains, can be logically categorized into actionable sets of practices, which then form a broader conceptualization of the demand planning process. Second, regarding certain contextual factors, our research seeks to investigate the contribution of demand planning, as a higher-order construct, to mitigating disruptions induced by operational risks in supply chains.

In this study, PLS-SEM was used to estimate the reflective-formative nature of the model. The results of PLS-SEM were additionally complemented by the assessment of the predictive power of our model. Finally, to reveal possible contingency effects, the multigroup analysis (MGA) was conducted.

The study suggests that demand planning process (DPP) is a second-order construct that is composed of four sets of practices, including goal setting, data gathering, demand forecasting, communicating the demand predictions and synchronizing supply with demand. The study also reveals that the demand planning practices, only when considered together, as a higher-order factor, significantly contribute to mitigating disruptions driven by operational risks. Finally, the research shows that the strength of the impact of demand planning on disruptions is contextually dependent.

While the study makes some important contributions, the obtained findings ought to be considered within the context of limitations. First, the study only investigates disruptions driven by operational risks, ignoring the negative consequences of environmental risks (terrorist attacks, natural disasters, etc.), which may have a far more negative impact on supply chains. Second, the sample is mostly composed of medium and large companies, not necessarily representative of demand planning performed by the entire spectrum of companies operating in the market.

The study shows that to effectively mitigate disruptions induced by operational risks, the demand planning practices should be integrated into a higher-order construct. Likewise, our research demonstrates that the intensity of demand planning process is contingent upon a number of contextual factors, including firm size, demand variability and demand volume.

The study indicates that to mitigate disruptions of operational risk, demand planning as a higher-order dynamic capability can be referred to the concept of organizational learning, which contributes to forming a critical common ground, ensuring the balance between formal and informal dynamic routines.

The paper depicts that to fully deal with disruptions, the demand planning practices need to be integrated and categorized into the dedicated higher-order. This may lead to forming demand planning as a higher-order dynamic capability that provides a more rapid and efficient rebuttal to any disruptions triggered by operational risks.

The purpose of this paper is to extend the well-established nomological network of service quality-relationship quality-customer loyalty by introducing service fairness – a distinct service evaluation concept. Specifically, the study aims to investigate the impact of service fairness on relationship quality as a complementary to service quality driver, and the direct and indirect effect of service fairness on customer loyalty in the presence of service quality and relationship quality in a no failure/recovery effort service context.

A telephone survey of a random sample of 408 customers of auto repair and maintenance services was implemented using a structured questionnaire with established scales. Data were analyzed with partial least squares path methodology, a structural equation modeling methodology.

Interactional fairness is the most important formative determinant of customers’ overall fairness perception, followed by procedural and distributive fairness. Relationship quality measured as a higher order construct, made of satisfaction; trust; affective and calculative commitment, is the main determinant of customer loyalty. Also, it partially mediates, along with service quality, the relationship between service fairness and customer loyalty and fully mediates the effect of service quality on customer loyalty. Finally, service fairness has the highest overall effect on customer loyalty.

The sample is industry-specific and this may affect generalizability of findings. Also, the cross-sectional design adopted does not reflect temporal changes.

Interactional fairness is of utmost importance to customers of the investigated industry. So, customers should be fairly treated at every point of contact. Also, service quality is heavily affected by service fairness. Thus, fair service leads to high-perceived service quality. Third, service quality affects customer loyalty only through relationship quality. Only when service quality is coupled by long-term quality relationships, signs of customer loyalty appear. Finally, service fairness influences customer loyalty mainly through service and relationship quality and has the highest overall effect on customer loyalty. So, fairly treating customers is crucial for developing long-term relationships that lead to customer loyalty.

The role of service fairness in the service quality-relationship quality-customer loyalty chain is investigated and using a higher order construct for relationship quality.

Partial least squares structural equation modeling (PLS-SEM) has attracted much attention from both methodological and applied researchers in various disciplines – also in hospitality management research. As PLS-SEM is relatively new compared to other multivariate analysis techniques, there are still numerous open questions and uncertainties in its application. This study aims to address this important issue by offering guidance regarding its use in contexts with which researchers struggle.

The authors examine the most prominent questions and answers posed in a well-known PLS-SEM discussion forum. The authors do so by using a text analysis technique to identify the most salient topics.

The data analysis identifies three salient PLS-SEM topics (i.e. bootstrapping and significance testing, higher-order constructs and moderation).

The results allow us to address the PLS-SEM community’s main methodological issues. The authors discuss each area separately and provide explanations and guidelines.

The guidelines on the most important PLS-SEM topics provide decision-making and application aids. In this way, the authors make a decisive contribution to clarifying ambiguities when applying the PLS-SEM method in hospitality management research and other disciplines.

There has as yet been no systematic analysis of this kind in the field of PLS-SEM; the authors, therefore, present the first research results. The findings and recommendations provide guidance for PLS-SEM applications in hospitality research and practice.

The purpose of this study is to develop and validate a scale to determine the consumer’s level of decision-making self-efficacy for a high-involved service purchase, specifically the purchase of medical insurance. One question to ask is how service providers can help consumers purchase the services that best meet their needs? Before interventions can occur, it is necessary to benchmark consumers’ perceptions of their own decision-making control and abilities.

A scale that measures consumers’ service decision-making self-efficacy was developed using the principles established for scale development validation. A four-study approach was used to reach the research objective.

The research consisted of four studies designed to: generate items to measure consumer service decision-making self-efficacy (CSDMSE); purify the scale and assess its dimensionality (second-order structure); establish the reliability and validity of the scale; and establish norms to provide details on its usefulness for aiding consumers with service purchases. The scale was found to be a higher-order construct, comprising three lower-order constructs.

Research suggests that consumer self-efficacy may affect their decision-making. The greater the consumer’s self-efficacy for decision-making tasks, the more efficient the decision-making process strategies are expected to be. This is the purpose for which the CSDMSE scale measure was created: to understand how, where and when service professionals can assist consumers with making appropriate service-related decisions and purchases.

Anticipating behaviour and responding to the needs of complexity and problematic issues requires modelling to facilitate analysis and diagnosis. Using arguments of anticipation as an imperative for inquiry, the purpose of this paper is to introduce generic modelling for living systems theory, and assign the number of generic constructs to orders of simplex modelling. An nth simplex order rests in an nth order simplex cybernetic space. A general modelling theory of higher orders of simplexity is given, where each higher order responds to every generic construct involved, the properties of which determining the rules of the complex system being that is represented. Higher orders of simplexity also explain greater degrees of complexity relatively simply, and give rise to the development of new paradigms that are better able to explain perceived complex phenomena.

This is part 2 of three linked papers. Using principles that arise from Schwarz’s living systems set within a framework provided by cultural agency theory, and with a rationale provided by Rosen’s and Dubois’ concepts of anticipation, the papers develop a general modelling theory of simplex orders. They show that with the development of new higher orders, paradigm shifts can occur that become responsible for new ways of seeing and resolving stubborn problematic issues. Part 1 established the fundamentals for a theory of modelling associated with cybernetic orders. Using this, in this part 2 the authors establish the principles of cybernetic orders using simplex modelling. This will include a general theory of generic modelling. In part 3 the authors shall extend this, developing a fourth-order simplex model, and exploring the potential for higher orders using recursive techniques through cultural agency theory.

Cultural agency theory can be used to generate higher simplex through principles of recursion, and hence to create a potential for the generation of families of new paradigms. The idea of conceptual emergence is also tied to the rise of new paradigms.

The use of higher order simplex models to represent complex situations provides the ability to condense explanation concerning the development of particular system behaviours, and hence simplify the way in which the authors analyse, diagnose and anticipate behaviour in complex situations. Illustration is also given showing how the theory can explain the emergence of new paradigms.

Cultural agency can be used to structure problem issues that may otherwise be problematic, within both a top-down and bottom up approach. It may also be used to assist in establishing behavioural anticipation given an appropriate modelling approach. It may also be used to improve and compress explanation of complex situations.

A new theory of simplex orders arises from the new concept of generic modelling, illustrating cybernetic order. This permits the possibility of improved analysis and diagnosis of problematic situations belonging to complex situations through the use of higher order simplex models, and facilitates improvement in behavioural anticipation.

The effect of dynamic capabilities on operational excellence and the moderating effect of environmental dynamism on the relationship between operational excellence and dynamic capabilities in the apparel industry in Sri Lanka were investigated while developing new psychometric scales to assess operational excellence and dynamic capacities constructs.

We followed the exploratory sequential research design with a mixed-method research approach, aligning with the pragmatic research philosophy. Thus, both qualitative and quantitative research methods were followed.

Dynamic capabilities positively affect operational excellence, and environmental dynamism moderates the relationship between operational excellence and dynamic capabilities in the apparel industry in Sri Lanka such that when a higher environmental dynamism exists, a weaker positive relationship exists between dynamic capabilities and operational excellence. The two main dimensions of the operational excellence construct are continuous improvement of sustainable operational performance and sustainable competitive advantages. It empirically confirmed that sensing, seizing and reconfiguring capabilities are the three main dimensions of the dynamic capabilities construct.

This study was limited to the apparel industry in Sri Lanka. This research phenomenon should be explored in other industrial sectors worldwide to generalize the findings. The practitioners in the apparel sector may improve the organizational dynamic capabilities to achieve operational excellence and keep a strong positive relationship between dynamic capabilities and operational excellence in a highly dynamic environment if they address out-of-family situations with out-of-the-box thinking.

We generated two new empirical findings: (1) dynamic capabilities positively affect operational excellence, and (2) environmental dynamism moderates the relationship between dynamic capabilities and operational excellence. Also, we introduced validated new scales for assessing operational excellence and dynamic capabilities.