Decision Criteria in the Adoption of EDI

Electronic data interchange, or EDI, has been discussed in literature as a technology that can provide a strategic advantage to its adopters, like other interorganizational information systems. However, its actual rate of adoption is nowhere near the predictions. Authors are now reconsidering their assessment of EDI's advantages and its role in organizations' strategies. However, using works found in critical mass theory, and through results gathered with the survey, case study and computer-supported interviews, this paper shows that organizations are acting strategically when deciding to not adopt EDI. They base their decisions on what their business partners are doing with respect to EDI, and on whether the actual and potential businesses they represent justify the investment required in EDI. The implications of the results for the study of innovation diffusion are discussed.