e-ISSN 2231-8542
ISSN 1511-3701

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Disintermediation Threat: Do Small Medium Traditional Travel Agencies in Malaysia embrace ICT adequately?

Uma Thevi Munikrishnan, Ng Siew Imm, Ho Jo Ann and Raja Nerina Raja Yusof

Pertanika Journal of Tropical Agricultural Science, Volume 27, Issue 1, March 2019

Keywords: Disintermediation, case studies, ICT Adoption, SME traditional travel agencies, Malaysia

Published on: 25 Mar 2019

As early as 1999, Werthner and Klein have acknowledged the disintermediation threat of Traditional Travel Agencies (TTA) due to the emergence of Virtual Travel Agencies (e.g. Travelocity, Expedia) and infomediaries (e.g. Travelbids, Priceline). Almost 18 years later, (as of 2017), it is interesting to investigate how TTAs cope with the disintermediation challenges by integrating ICT into their business models. Older and more established institutions (more than 20 years in business) like TTAs were said to bemore resistant to change (Institutional Theory). Will it be the case for industries going through disintermediation threat? Qualitative multiple case studies method was used to ensure the issues were explored through multiple lenses. Semi-structured interviews, website content analysis and direct observation are used to collect data from fifteen case firms in Malaysia. The findings suggests a three level ICT adoption model for SME TTA in Malaysia: six were 'low ICT adopters', five were 'intermediate ICT adopter' and four were 'advance ICT adopter'. Low ICT adopter merely use static website and email, while intermediate and advance adopter acquired ICT capabilities almost equivalent to those of Virtual Travel Agencies with interactive website or advanced e-business. This indicated that majority of SME TTAs in Malaysia were embracing ICT adequately. The study also concluded that non-stage models explained adoption levels more appropriately since some TTAs were found regressing to lower level after advancing to higher level.

ISSN 1511-3701

e-ISSN 2231-8542

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