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E-business is rapidly spreading in service industries. Firms that adopt this innovative way to sell or deliver services and manage customer relationships must make technological and strategic changes. Firms in the same industry adopt e-business at different rates. Why do some firms actively implement e-business, and others take a more cautious attitude? Drawing on several research streams (innovation adoption research, institutional theory, strategic orientation theory, and upper-echelon theory), this article proposes a multi-level model to explain e-business adoption by service firms. The model was empirically tested using survey and interview data from travel agencies in Taiwan. External competitive pressure, innovation orientation, financial slack, and IT resources were found to be associated with two measures of e-business adoption. CEO risk-taking propensity and firm size also had an interaction effect on e-business adoption. Interviews with CEOs indicate that most travel agencies in Taiwan are not yet ready to apply mobile technologies in their daily business. The slow progress of mobile e-business was largely attributed to the limited capacity of mobile devices and the misfit between travel product characteristics, consumer behavior, and current mobile solutions.
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