Investigating the Buy-Side's Adoption Decision for Technology-Driven Execution Opportunities: An Extension of TAM for an Organizational Adoption Context

Within the securities trading industry recent technological innovations enable Institutional Investors to self-directed trading and thus lead to a reassessment of their intermediation relationships. This may yield to an in-sourcing of trading activities by buy-side organization. Scientific literature outlines advantages and disadvantages of some of them but no empirical investigations are reported concerning drivers for the adoption or refusal of such innovations. Against the background of the increasing market share of technologies, such as Algorithmic Trading, this conceptual paper introduces a model that aims at closing this gap, by identifying the drivers and inhibitors for the adoption of new technology-based execution opportunities. To account for the organizational context of the survey and the meta-character of the innovation, the model incorporates the following modifications of TAM: First, a generalization towards TRA and TPB in order to account for competitive pressure and inhibitors. Second, the integration of TTF, as it is said to exhibit better results for work-related tasks and thus enables the model to account for the fit between the technology and the given task requirements. Finally, a perceived risk construct is added, as in an organizational context the adoption of innovations is associated with risks.