What Drives IoT Adoption? Insights from SMEs in Manufacturing

Abstract

This study examines key factors influencing the adoption of Internet of Things (IoT) technology among small and medium-sized enterprises (SMEs) in the Malaysian manufacturing sector. IoT has the potential to transform business operations by enhancing efficiency, productivity, and competitiveness, yet its adoption reported remains low among SMEs. This study examines the factors influencing adoption of IoT within the manufacturing sector grounded in the Technology Acceptance Model (TAM) and the Theory of Planned Behavior (TPB). Through a comprehensive literature review, this research examines key factors influencing IoT adoption, including Attitude and Perceived Behavioral Control derived from the TPB model, Perceived Ease of Use and Perceived Usefulness derived from TAM model. Both frameworks offer understanding on how factors shape the IoT adoption decisions. The insights provided in this study aim to fill a critical gap in IoT adoption literature by focusing on the underexplored context of Malaysian manufacturing SMEs. By understanding the analysis of the frameworks, the findings show how variables of the framework influence IoT adoption decision in SMEs. This study identified key determinants such as Attitude, Perceived Behavioral Control, Perceived Ease of Use, and Perceived Usefulness. This study contributes to theoretical and practical implications and highlights areas where interventions can effectively support IoT implementation.