Technology-organization-environment framework

Acronym
TOE Framework

Alternate name(s)
Organization, Technology, and Environment

Main dependent construct(s)/factor(s)
Technology Adoption (or Likelihood of Adoption, Intention to Adopt, Extent of Adoption)

Main independent construct(s)/factor(s)
Technological Context Organizational Context Environmental Context

Concise description of theory
The process by which a firm adopts and implements technological innovations is influenced by the technological context, the organizational context, and the environmental context (Tornatzky and Fleisher 1990).

The technological context includes the internal and external technologies that are relevant to the firm. Technologies may include both equipment as well as processes. The organizational context refers to the characteristics and resources of the firm, including the firm’s size, degree of centralization, degree of formalization, managerial structure, human resources, amount of slack resources, and linkages among employees. The environmental context includes the size and structure of the industry, the firm’s competitors, the macroeconomic context, and the regulatory environment (Tornatzky and Fleisher 1990).

These three elements present “both constraints and opportunities for technological innovation” (Tornatzky and Fleisher 1990, p. 154). Thus, these three elements influence the way a firm sees the need for, searches for, and adopts new technology.

Originating author(s)
Tornatzky and Fleisher 1990

Seminal articles
Tornatzky, L.G., and Fleischer, M. The Processes of Technological Innovation. Lexington Books, Lexington, Massachusetts, 1990.

Rogers, E.M. Diffusion of Innovations, (4th ed.) The Free Press, New York, 1995.

Originating area
Organizational Psychology

Level of analysis
Firm/Organization

IS articles that use the theory
Chau, P.Y.K., and Tam, K.Y. "Factors Affecting the Adoption of Open Systems: An Exploratory Study," MIS Quarterly (21:1), March 1997, pp. 1-24.

Grover, V. "An Empirically Derived Model for the Adoption of Customer-Based Interorganizational Systems," Decision Sciences (24:3), May/June 1993, pp. 603-640.

Kuan, K.K.Y., and Chau, P.Y.K. "A Perception-Based Model for EDI Adoption in Small Businesses Using a Technology-Organization-Environment Framework," Information & Management (38:8) October 2001, pp. 507-521.

Lee, C.-P., and Shim, J.P. "An Exploratory Study of Radio Frequency Identification (RFID) Adoption in the Healthcare Industry," European Journal of Information Systems (16:6) December 2007, pp. 712-724.

Mishra, A.N., Konana, P., and Barua, A. "Antecedents and Consequences of Internet Use in Procurement: An Empirical Investigation of U.S. Manufacturing Firms," Information Systems Research (18:1) 2007, pp. 103-120.

Thong, J.Y.L. "An Integrated Model of Information Systems Adoption in Small Businesses," Journal of Management Information Systems (15:4), Spring 1999, pp. 187-214.

Zhu, K., Kraemer, K., and Sean Xu, K. "Electronic business adoption by European firms: a cross-country assessment of the facilitators and inhibitors," European Journal of Information Systems (12:4) 2003, pp. 251-268.

Zhu, K., and Kraemer, K.L. "Post-Adoption Variations in Usage and Value of E-Business by Organizations: Cross-Country Evidence from the Retail Industry," Information Systems Research (16:1) 2005, pp. 61-84.

Zhu, K., Kraemer, K.L., and Xu, S. "The Process of Innovation Assimilation by Firms in Different Countries: A Technology Diffusion Perspective on E-Business," Management Science (52:10) 2006, pp. 1557-1576.

Zhu, K., Kraemer, K.L., Xu, S., and Dedrick, J. "Information Technology Payoff in E-Business Environments: An International Perspective on Value Creation of E-Business in the Financial Services Industry," Journal of Management Information Systems (21:1), Summer 2004, pp. 17-54.

Links from this theory to other theories
Diffusion_of_innovations_theory, Real_options_theory

Original Contributor(s)
[mailto:jbaker@aus.edu Jeff Baker]

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