SELF-INTEREST IN INNOVATION DIFFUSION DECISION PROCESS: THE CASE OF EXTENDING BROADBAND INTERNET SERVICES TO RURAL AREAS OF GHANA

SELF-INTEREST IN INNOVATION DIFFUSION PROCESS

THE CASE OF EXTENDING BROADBAND INTERNET SERVICES TO RURAL AREAS OF GHANA

PAT R I C K O H E M E N G G YA S S E ( P H . D . F E L L O W ) & I D O N G E S I T W I L L I A M S ( P H . D . F E L L O W )C M I , A A L B O R G U N I V E R S I T Y

PA K W @ C M I . A A U . D K & I D O N G @ C M I . A A U . D K

mailto:[email protected]

mailto:[email protected]

CONTENTI N T R O D U C I N G

S E L F I N T E R E S TD E C I S I O N

A S S E S S M E N T

S E L F - I N T E R E S T I N I N N O V A T I O N D I F F U S I O N P R O C E S S – 1 O F 2 3 | 1 2 . 0 6 . 2 0 1 3

C M IA A L B O R G U N I V E R S I T Y C O P E N H A G E N

I NT R O D U C T I O N

T H E I N T E R N E T C A F E I N N O VAT I O N

D I F F U S I O N O F I NN O VAT I O N

I NN O VAT I O N D E C I S I O N P R O C E S S F O R I N T E RN E T C A F E S I N G H A NA

ME T H O D O L O G Y

D ATA A N A LY S I S

C O N C L U S I O N

1.INTRODUCTION Th is research iden t i f i es the ro le o f Se l f In te res t i n dec is ion mak ing

w i th regards to innova t ion D i f fus ion .

I t en r i ches Rogers d i f fus ion o f i nnova t ion canvas by c rea t ing a cons t ruc t to unders tand the dec is i on mak ing p rocess in the adopt ion and fu r ther d i f f us ion o f an innovat ion fo r a techno logy /serv i ce .



The research p rob lem i s , wha t th ink ing p rocess leads to the accep tance o r re jec t ion o f an innova t ion a t the dec is ion mak ing leve l fo r a techno logy /serv i ce ?

To unders tand th i s phenomenon a research was car r ied ou t i n Ghana to unders tand why the in te rne t ca fé innova t i on d i f f used eas i l y i n the c i t i es and no t i n ru ra l a reas .

What fac to rs d id the in te rne t ca fé opera to rs take in to cons idera t ion on where to de l i ve r the innova t ion?

The resu l t was the d iscovery o f the Se l f I n te res t Dec is i on Assessment (S IDA) cons t ruc t .



“INNOVATION IS THE CENTRAL ISSUE IN ECONOMIC

PROSPERITY”- MICHAEL PORTERS .



I n te rne t ca fes or ig ina ted f rom sou th Korea in 1988

The phenomenon go t to the Un i ted S ta tes in 1991

The or ig ina l i n ten t ion was to enab le peop le communica te w i th the in te rne t a t co f fee houses

The presence o f In te rne t Ca fes in the wes t i s on the decrease

I n te rne t Ca fes was adop ted i n A f r i ca f rom the la te 1990 ’s and became preva len t a t the end o f the cen tu ry

The presence o f i n te rne t ca fes in A f r i ca i s on the r i se bu t p reva len t i n the c i t i es and no t ve ry much in ru ra l a reas

The in te rne t ca fé i s an innova t ion because i t was a new so lu t ion dep loyed to meet the in te rne t marke t needs , espec ia l l y fo r those who cou ldn ’ t a f fo rd the serv i ce on the i r own.



2. THE INTERNET CAFE INNOVATION

“ THERE ARE AT LEAST 80 INTERNET CAFES LOCATED IN THE MAJOR CITIES OF GHANA”

- BUSINESSGHANA.COM



Theory popu la r i zed by Rogers

The e lements o f the theory inc lude Innova t ion , Communica t ion Channe ls , t ime and the soc ia l sys tem.

Di f fus ion i s the p rocess in wh i ch an Innovat ion i s communicated th rough cer ta in channe ls over t ime among members o f a socia l system (Rogers , 1995)

Innovat ion : Ideas , p rac t i ce o r ob jec t perce ived as new by the adop te r

Communicated exchange : In fo rmat i on exchange channe l be tween the innova to r and the in tended users

Time : Time d imens ion invo lved i n the per iod o f d i f f us ion

Socia l System : I n te r re la ted un i t s tha t so lve p rob lems toge ther to accompl i sh a common goa l

3. DIFFUSION OF INNOVATION



D I F F U S I O N P R O C E S S





4.INNOVATION DECISION PROCESS FOR

INTERNET CAFES IN GHANA

Knowledge Persuasion Decision Implementation Confirmation

Yes Yes Yes Yes Yes

Urban Urban Urban Urban Urban

Yes NoYes No No

Rural Rural Rural Rural Rural

Internet Café Operator as an Adopter of

innovation

Internet Café operator as a carrier

of innovationTransforms

Decision process for internet Café operators


S E L F - I N T E R E S T I N I N N O V A T I O N D I F F U S I O N P R O C E S S – 1 0 O F 1 2 | 1 2 . 0 6 . 2 0 1 3

“ METHODOLOGY”



PHILOSOPHICAL APPROACH IS INTERPRETIV IST

Research approach i s deduc t i ve

Research s t ra tegy i s case s tudy

Research method i s qua l i ta t i ve

Research techn iques inc lude in terv iews and ques t ionna i res (sample : 25 in te rne t ca fé opera to rs in Ghana)



What a re the fac to rs tha t fac i l i t a te the i r i nves tment i n c i t i es?

Reasons the en t repreneurs don ’ t i nves t i n ru ra l a reas?

What incen t i ves w i l l enab le the en t repreneurs inves t i n the deve lopment o f i n te rne t ca fés in ru ra l a reas?

5. DATA ANALYSIS



There i s a ready demand fo r i n te rne t ca fés

There i s a ava i lab le in f ras t ruc tu re (hence connec t i v i t y )

There i s cons tan t and re l i ab le in te rne t se rv i ce

Hence the cos t o f es tab l i sh ing an in te rne t ca fé i s l ow

Here the i n te rne t ca fé opera to rs can make p ro f i t

Availab

ility o

f Netw

ork Infra

structu

re

Deman

d for In

ternet

Servic

e

Tax Ex

emptions

Cheap o

f Connecti

vity

Low start

-up capita

l require

d

Low cost

of Hard

ware re

quired

Constant a

nd relia

ble Inter

net Ser

vices

Constant a

nd relia

ble Power

Supply

Trained

ICT s

peciali

st, (Profes

sion)

25 25

16

116

16

9 10

0 05

2 3 2 4 6 8

0 0

19 1711

17

2

9 7

Facilitating Factors A I D

A - Agree I - Indifferent D - Disagree



0

25 25 2320

17

23

48

30 0 2

5 3 2

85

22

0 0 0 05

0

13 12

Rural Problems A I D

There i s l i t t l e te lecom in f ras t ruc tu re ava i lab le

There i s l i t t l e o r no demand fo r i n te rne t connec t i v i t y

High cap i ta l expend i tu re

Government i n i t i a t i ves and incent i ves needed to boos t the des i re to i nves t

X = Low infrastructure

X




URBAN GHANA

NETWORK AVAILABIL ITY AVAILABIL ITY

DEMANDRELIABLE INTERNET SERVICECHEAPER COST OF BANDWIDTH

OPPORTUNITY

LOW START UP CAPITAL COST

PROFITRETURN ON INVESTMENT



RURAL GHANA

NO NETWORK AVAILABIL ITY LOW AVAILABIL ITY

LOW DEMANDUNRELIABLE INTERNET SERVICEHIGH COST OF BANDWIDTH

LOW OPPORTUNITY

HIGH START UP CAPITAL HIGH COST

UNCERTAIN PROFITUNCERTAIN RETURN ON INVESTMENT



Ava i lab i l i t y o f techno logy needed fo r se rv i ce de l i ve ry

Oppor tun i t i es in de l i very o f the serv i ce enab led by the techno logy

Cost o f se rv i ce de l i ve ry

Prof i t ce r ta in ty on de l i ve ry o f se rv i ce



AVAILABIL ITY OPPORTUNITY COST PROFIT

I S T H E T E C H N O L O G Y

F O R T H E I N N O VAT I O N AVA I L A B L E ?

I S T H E R E A N O P P O R T U N I T Y T O I N V E S T I N

T H E I N N O VAT I O N ?

W H AT I S T H E C O S T O F

I N V E S T I N G I N T H E

I N N O VAT I O N ?

W H AT I S T H E R E T U R N O N

I N V E S T M E N T ?

Y E S Y E SL O WY E S

Y E S Y E S / N O M E D I U M U N C E R TA I N

DECISION

A D O P T

U N C E R TA I N

N O N O H I G H N O R E J E C T

W H AT I S T H E I N V E S T M E N T

D E C I S I O N ?

S E L F I N T E R E S T I S E V I D E N T I N T H E D E C I S I O N T O I N V E S T I N I N T E R N E T C A F E S I N G H A N A .

T H E D E C I S I O N T O A D O P T T H E B U S I N E S S M O D E L A N D F U R T H E R D I F F U S E I N T E R N E T P E N E T R AT I O N U S I N G T H E I N T E R N E T C A F É I S H E AV I LY D E P E N D E N T. O N T H E S E L F

I N T E R E S T O F T H E I N T E R N E T C A F É E N T R E P R E N E U R S



Knowledge Persuasion Decision Implementation Confirmation

AvailabilityOpportunityCostProfit

Positive

Negative

Low Profitability?

YesNo

SIDA

Decision is Yes

Decision is No

Provide alternative Incentives

Discontinue Innovation



048

121620

ADI

Availability Opportunity

Cost Cost

Profit

Market Incentives




Dec is ion i s a th ink ing p rocess

Dec is ion to accep t o r re jec t an innova t ion i s anchored on se l f i n te res t o f the ma jo r ac to r de l i ve r ing the innova t i on to the soc ia l sys tem

SIDA i s tha t p rocess o f th ink ing in our con tex t o f techno logy and serv i ce adop t ion and d i f f us ion

There i s room fo r more tes ts to va l i da te th i s cons t ruc t

6. CONCLUSION



Education

SELF-INTEREST IN INNOVATION DIFFUSION DECISION PROCESS: THE CASE OF EXTENDING BROADBAND INTERNET SERVICES TO RURAL AREAS OF GHANA