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
P A T R I C K O H E M E N G G Y A 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
P A K W @ C M I . A A U . D K & I D O N G @ C M I . A A U . D K

CONTENT
I N T R O D U C I N G
S E L F
I N T E R E S T
D 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 I
A 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
 INTRODUCTION
 THE INTERNET CAFE INNOVATION
 DIFFUSION OF INNOVATION
 INNOVATION DECISION PROCESS FOR INTERNET CAFES IN GHANA
 METHODOLOGY
 DATA ANALYSIS
 CONCLUSION

1.INTRODUCTION
 This research identifies the role of Self Interest in decision making
with regards to innovation Diffusion.
 It enriches Rogers diffusion of innovation canvas by creating a
construct to understand the decision making process in the adoption
and further diffusion of an innovation for a technology/service.
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 The research problem is, what thinking process leads to the
acceptance or rejection of an innovation at the decision making level
for a technology/service?
 To understand this phenomenon a research was carried out in Ghana
to understand why the internet café innovation diffused easily in the
cities and not in rural areas.
 What factors did the internet café operators take into consideration
on where to deliver the innovation?
 The result was the discovery of the Self Interest Decision
Assessment (SIDA) construct.
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“INNOVATION IS THE CENTRAL
ISSUE IN ECONOMIC
PROSPERITY”
- MICHAEL PORTERS.
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 Internet cafes originated from south Korea in 1988
 The phenomenon got to the United States in 1991
 The original intention was to enable people communicate with the
internet at coffee houses
 The presence of Internet Cafes in the west is on the decrease
 Internet Cafes was adopted in Africa from the late 1990’s and
became prevalent at the end of the century
 The presence of internet cafes in Africa is on the rise but prevalent
in the cities and not very much in rural areas
 The internet café is an innovation because it was a new solution
deployed to meet the internet market needs, especially for those
who couldn’t afford the service on their own.
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2. THE INTERNET CAFE INNOVATION

“ THERE ARE AT LEAST 80
INTERNET CAFES LOCATED IN
THE MAJOR CITIES OF GHANA”
- BUSINESSGHANA.COM
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 Theory popularized by Rogers
 The elements of the theory include Innovation, Communication
Channels, time and the social system.
 Diffusion is the process in which an Innovation is communicated
through certain channels over time among members of a social
system (Rogers, 1995)
 Innovation: Ideas, practice or object perceived as new by the
adopter
 Communicated exchange : Information exchange channel
between the innovator and the intended users
 Time: Time dimension involved in the period of diffusion
 Social System: Inter related units that solve problems together
to accomplish a common goal
3. DIFFUSION OF INNOVATION
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D I F F U S I O N P R O C E S S
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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 innovation
Transforms
Decision process for internet Café operators
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“ METHODOLOGY”
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 PHILOSOPHICAL APPROACH IS INTERPRETIVIST
 Research approach is deductive
 Research strategy is case study
 Research method is qualitative
 Research techniques include interviews and questionnaires (sample:
25 internet café operators in Ghana)
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 What are the factors that facilitate their investment in cities?
 Reasons the entrepreneurs don’t invest in rural areas?
 What incentives will enable the entrepreneurs invest in the
development of internet cafés in rural areas?
5. DATA ANALYSIS
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 There is a ready demand for internet cafés
 There is a available infrastructure (hence connectivity)
 There is constant and reliable internet service
 Hence the cost of establishing an internet café is low
 Here the internet café operators can make profit
25 25
1
6
11
6
16
9 10
0 0
5
2 3 2
4
6
8
0 0
19
17
11
17
2
9
7
Facilitating Factors
A I D
A - Agree I - Indifferent D - Disagree
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0
25 25
23
20
17
23
4
8
3
0 0
2
5
3 2
8
5
22
0 0 0 0
5
0
13 12
Rural Problems A I D
 There is little telecom infrastructure available
 There is little or no demand for internet connectivity
 High capital expenditure
 Government initiatives and incentives needed to boost the desire to
invest
X = Low infrastructure
X
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URBAN GHANA
NETWORK AVAILABILITY AVAILABILITY
DEMAND
RELIABLE INTERNET SERVICE
CHEAPER COST OF BANDWIDTH
OPPORTUNITY
LOW START UP CAPITAL COST
PROFITRETURN ON INVESTMENT
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RURAL GHANA
NO NETWORK AVAILABILITY LOW AVAILABILITY
LOW DEMAND
UNRELIABLE INTERNET SERVICE
HIGH COST OF BANDWIDTH
LOW OPPORTUNITY
HIGH START UP CAPITAL HIGH COST
UNCERTAIN PROFIT
UNCERTAIN RETURN ON
INVESTMENT
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 Availability of technology needed for service delivery
 Opportunities in delivery of the service enabled by the technology
 Cost of service delivery
 Profit certainty on delivery of service
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AVAILABILITY 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 V A T I O N
A V A 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 V A T I O N ?
W H A T 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 V A T I O N ?
W H A T 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 T A I N
DECISION
A D O P T
U N C E R T A I N
N O N O H I G H N O R E J E C T
W H A T 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 A T 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 A V I L Y 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
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Knowledge Persuasion Decision Implementation Confirmation
Availability
Opportunity
Cost
Profit
Positive
Negative
Low Profitability?
YesNo
SIDA
Decision is Yes
Decision is No
Provide alternative
Incentives
Discontinue
Innovation
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0
2
4
6
8
10
12
14
16
18
20
Cheaper rates
for Bandwidth
to rural areas
Provision of
Network
Infrastructure
Cheaper
hardware
(CPE) through
subsidies
Presence of
demand for
Internet
services
Provision of
equipment
and start up
by
government
Tax Incentives
A
D
I
Availability Opportunity
Cost Cost
Profit
Market Incentives
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 Decision is a thinking process
 Decision to accept or reject an innovation is anchored on self
interest of the major actor delivering the innovation to the social
system
 SIDA is that process of thinking in our context of technology and
service adoption and diffusion
 There is room for more tests to validate this construct
6. CONCLUSION
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SELF-INTEREST IN INNOVATION DIFFUSION DECISION PROCESS: THE CASE OF EXTENDING BROADBAND INTERNET SERVICES TO RURAL AREAS OF GHANA