Clarke et al 2009 ICT in Small and Medium Enterprises

1 Silburn Clarke, Denis Gray, Cheralee Morgan, Charmaine Nelson, Leroy Paul, Dwight Shelley, Sherry Wainwright-Crooks

ICT in Small and Medium-Sized Enterprises (SMEs)

UWI WORKING PAPER

MSBM

April 2009


Information and Communication Technology (ICT) in Small and Medium-Sized

Enterprises (SMEs)

INTRODUCTION:

The viewpoint or level of importance usually taken of Small and Medium-Sized Enterprises

(SMEs) by both Governments and the business communities worldwide, have dramatically

changed to take on a more positive and very significant perspective over the last two to three

decade. This recognition has also been championed and given prominence by small business and

management and business researchers. World governing bodies and multi-lateral institutions

have also turned their lenses on this business group and have signaled their intention and support

by identifying funding and other initiatives aimed at facilitating SMEs growth and the

subsequent development of their competitive advantage. One such initiative saw the World

Bank Review on Small Business Activities establishes the commitment of the World Bank

Group to the development of the SME sector as a core element in its strategy to foster economic

growth, employment and poverty alleviation. In the year 2004 alone, the World Bank Group

approved roughly US$2.8 billion in support of micro, small and medium enterprises.

SMEs and entrepreneurship are now recognized world-wide to be a key source of dynamism,

innovation and flexibility in advance industrialized countries, as well as in emerging and

developing economies. They are responsible for most net job creation in OECD countries and

make important contributions to innovation, productivity and economic growth. (OECD, 2005).

SMEs constitute the dominant form of business organization in all countries world-wide,

accounting for over 95% and up to 99% of the business population depending on the country. In

2003, 99.8% of enterprises in the enlarged EU were SMEs (<250 employees). Small enterprises

(<50 employees) make up at least 95% of manufacturing enterprises in most economies. (OECD,

2005).

SMEs, in the USA, account for three out of every four new jobs and contribute to providing over

half of the gross domestic product (Underwood, 2004 cited in Todd and Javalgi, 2007). From


1992 to 1999, the number of SMEs that were involved in exporting increased over 100 percent,

to nearly 97 percent of all exporting firms in the USA, and accounting for $168.5 billion in value

(Underwood, 2004 cited in Todd and Javalgi, 2007).

In the Caribbean region Governments and other institutions in the business sector such as banks

and training agencies have been developing strategies and policies in support of SMEs growth

and development.

In 1987, the small business sector in Jamaica generated employment and income accounting for

approximately $508.3 million, or 26% of the country’s gross domestic product. The sector also

registered the highest rate of growth in the economy (2.6%), compared to a national growth rate

of 0.5% and a growth rate among large businesses of 1.8% (Trevor Hamilton and Associates

1989 cited in Huck and McEwen, 1991).

The following excerpts summarize varying viewpoints on the growing recognition of SMEs

contribution to the social and economic growth of countries:

SMEs now play a vital role of increasing importance in the economy (especially when we

consider their contribution to the generation of jobs as well as the social-economic

development of the community where they are located)( Harrington, 2005)

Smaller entrepreneurial firms are proving to be “engines of growth” both in the USA and

abroad (Brown and Butler, 1995). Small firms are important for economic progress in

many countries and contribute a large portion of jobs to job pool (Lawrence, 2007;

Coviello and Munroe, 1995; Fuller-Love and Thomas, 2004).

Since the mid-seventies, SMEs have been increasingly important in job creation (Storey,

D.J. 1994 cited in Maguire et. Al., 2007).

SMEs have increased the competitive intensity of the market and reduce the monopolistic

positions of large organizations and encouraged the development of entrepreneurial skills

and innovation (Todd and Javalgi, 2007).


However, critical to the growth, survival and subsequent development or creation of sustainable

competitive advantage of SMEs, is the inclusion and integration of ICT into their business

operations. According to an executive of a Jamaican SME in the financial services industry, the

accrued benefits derived from the use of ICT far outweighed the costs and challenges associated

with the investment. Sharma and Bhagwat (2006) posited that, SMEs which have implemented

ICT have seen its impact on their overall competitive position.

SME Definitions:

The term SME covers a wide range of definitions and measures, varying from country to country

(Ayyagari, Beck, Demirguc-Kunt, 2007). The definitions are statistical or administrative and

based on the number of employees, number of annual working hours, annual turnover, annual

balance sheet or production volume and independence of the company. The number of

employees and annual turnover seem to be the criteria applied in most countries. However, the

definitions are different in relation to economic activity sectors, making cross-country

comparisons difficult (Harjula, 2008).

The SME Department of the World Bank works with the following definitions: micro

enterprise – up to 10 employees, total assets of up to US$100,000; small enterprise – up

to 50 employees, total assets and total sales of up to US$3 million; medium enterprise –

up to 300 employees and total assets and total sales of up to US$15 million.

SMEs within the Jamaican context are defined as firms having less than 50 employees

(Small Business Association of Jamaica, 2007 as cited in Lawrence, 2007).

ICT Definitions:

ICT must be conceived broadly to encompass the information that businesses create and use, as

well as the wide spectrum of increasingly convergent and linked technologies that process that

information (Barba-Sanchez, Martinez-Ruiz, Jimenez-Zarco, 2007).

ICT can be viewed as a collective term for a wide range of software, hardware,

telecommunications and information management techniques, application and devices,

and are used to create, produce, analyse, process, package, distribute, receive, retrieve,

store and transform information (Porter and Millar, 1985 and Brady et. al., 2002).


ICT are actually a wide range of infrastructures, instruments, objects, processes,

protocols, metacodes and devices which when combined facilitate the creation, retrieval,

storage, processing, analyzing, management and dissemination of information (Waller,

2006).

In today’s business environment the effective use of Information Systems and Information

Technology can provide small firms with the opportunity to take advantage of ICT. Developing

intranets and linking into extranets will allow small firms to exploit the business benefits of ICT.

This may also allow SMEs to forge strategic alliances with other organizations. Creative use of

the internet will also allow SMEs to take advantage of market opportunities. (Maguire, Kohl &

Magrys, 2007).

ICT AND SMEs

The use of ICT has grown and changes with increasing rapidity. Its adoption can be related to

not only multinationals corporations, but also SMEs (Maguire et. al., 2007). ICT is seen as being

critically important to the financial wellbeing of all organizations, and SMEs are able to use it to

operate successfully in the global market place (Maguire et. al., 2007).

ICT as a Strategic Resource

Firms need to develop competitive advantages based on adequate and intensive use of ICT as an

important strategic tool, which is an essential element of success in today’s market (Davies,

Garcia-Sierra, 1999; Soliman and Janz 2004). This is especially true for SMEs, whose survival

depends, inter alia, on the use that they make of ICT to develop new organizational models,

compete in new markets or enhance their internal and external communication relationships.

(Barba-Sanchez et. al. 2007).

As a strategic resource ICT are regarded by some as not only a means for functional integration

but as an opportunity to enhance the competitive capabilities of the firm. When analyzed in the

context of Porter’s generic models the importance of strategic alignment is evident where


enterprises choose to use ICT to achieve cost leadership (Boddy et. al., 2002). In a study done by

Maguire et al, 2007, they concluded that SMEs can gain competitive advantage through the use

of ICT, as respondents cited ICT as being valuable in one or more of the competitive forces in

Porter’s 1980 Model. Conversely, research in the use of ICT in SMEs in the building and

construction sector, found that they do not consider such technologies to be strategic (Sarshar

and Isikdag 2004; Acar et al 2005). In support of this view, Pavic, Koh, Simpson, Padmore

(2007) in a research on SMEs in the UK, could not find measureable evidence that e-business

can create a competitive advantage in SMEs.

It is evident therefore that the area of SMEs, and their possible use of ICT for competitive

advantage needs more research (Maguire et al, 2007).

Theoretical Frameworks for the Adoption of ICT

SME’s are typically owner-managed and can be characterised as social formations in which

interpersonal relationships with family, friends and other businesses often influence their

e-business adoption decisions (Simpson and Docherty, 2004). A model of the dynamics of this

social formation (Parker and Castleman, 2009) is illustrated in Figure 1,.


Several researchers have put forward existing theories which they identify as providing a

theoretical basis for assessing the factors that influence SMEs adoption of ICT. These include:

Diffusion of Innovations (DOI) Theory: Innovations are communicated through certain

channels over time and within a particular social system. Individuals are seen as possessing

different degrees of willingness to adopt innovations and thus generally observed that the portion

of the population adopting an innovation is approximately normally distributed over time. For

DOI, breaking this normal distribution into segments leads to the segregation of individuals into

the following five categories of individual innovativeness, from earliest to latest adopters:

innovators, early adopters, early majority, late majority, laggard (Rogers, 1995).

Social Network Theory (SNT) views social relationships in terms of nodes and ties. Nodes are

individual actors within the networks and Ties are relationships between the actors. In its most

simple form, a Social Network is a map of all of the relevant ties between the nodes being

studied. The attributes of individuals are less important than their relationships and ties with

other actors within the network (Barnes, 1954)

Technology Acceptance Model (TAM) posits that perceived usefulness and ease of use

determine an individual's intention to use a system, with intention to use serving as a mediator of

actual system use. Perceived usefulness is also seen as being directly impacted by perceived

ease of use. (Davis, 1986)

Theory of Planned Behaviour (TPB) posits that individual behaviour is driven by behavioral

intentions where behavioural intentions are a function of an individual's attitude toward the

behaviour, the subjective norms surrounding the performance of the behavior, and the

individual's perception of the ease with which the behaviour can be performed. (Ajzen, 1985)

Opportunities for Adoption of ICT

Technical advances have made computers more powerful and less expensive giving small firms

the potential to use software to make the businesses more competitive (Steinhoff and Burgess,

1993 cited in Maguire et al, 2007). Storey 1994, cited in Maguire et al, 2007, argued that small

firms are more likely to introduce fundamentally new innovations as they have less commitment

to existing practices and products. Perry 1999 cited in Maguire et al 2007 expanded on this


viewpoint by positing that at the same time they may be able to take advantage of existing

software that has been thoroughly tested through its utilization with other organizations.

It appears that ICT, such as e-business tools and technologies may be assuming a leading role in

achieving business objectives, especially those related to managing operations. Many SMEs are

now moving to the e-business era and becoming more technological-centred in conducting their

business and production processes (Maguire et. al., 2007). E-commerce was found to benefit

innovative small businesses that initiate and develop new types of business relationships

(Trappey and Trappey, 2001 , Feher and Towell 1997 cited in Martin and Matley 2009).

The internet, for example, is seen as an enabler that ultimately changes the way that business is

conducted (Cottrill, 1997). While internet penetration is normally higher in larger enterprises, it

is detected that the gap between larger firms and SMEs is in fact narrowing (Barba-Sanchez et.

al. 2007). It is also viewed as an extraordinarily powerful tool to ensure that small businesses can

compete with larger firms (Hamill and Gregory, 1997; Rayport and Sviokla, 1995). Companies

can therefore use the internet to present almost unlimited information about their products and

services in cyberspace (Alam, Ahsan, 2007).

ICT Adoption in SMEs

The size of the firm has been found to be related to ICT adoption rates (Haynes et al 1998,

Riquelme 2002). Despite the increasing availability of ICT, SMEs have not developed ICT

strategies and hardly extend them for competitive use. (Maguire 2007, Matula and Brakel 2006).

It has been noted that the engagement with ICT in SMEs is relatively extensive, but is primarily

rudimentary, mainly through the use of spread sheets and accounting packages, email and the

internet. (Taylor and Murphey 2004, Maguire 2007, Shiels et al 2003).

It is then desirable that SMEs are stimulated into adopting new technologies more rapidly

(Barba-Sanchez et. al. 2007). A suitable model of SME adoption of ICT, would therefore provide

a structured approach to performance improvement through the further adoption and use of ICT

by SMEs (Shiels et al 2003).


In one case, Martin and Matlay (2001), highlighted the UK Department of Trade and Industry

(DTI) Adoption Model which represents the ICT adoption processes in SMEs and shows the

relationship between the extent of organizational change, sophistication in the adoption of ICT,

and the benefits to business (see Figure 1 below). However, critics highlighted that the model

lacked flexibility and failed to take into account factors such as size, sector, human and financial

resources and level of internationalization (Trappey and Trappey, 2001; Feher and Towell, 1997

cited in Martin and Matlay, 2001).


Figure 1

ICT Performance and Strategic Alignment in SMEs

The effectiveness of ICT on firm performance has been one of the most debated subjects in IS

among researchers and practitioners alike. A perusal of the literature surrounding this topical

issue reveals that the findings have produced mixed results. For instance, some researchers assert

a positive impact of ICT on business performance (Barua, 1995) while others regard the

relationship as insignificant (Straussmann, 1990). At the other extreme, there are those

researchers who assert that there is a negative impact of ICT on business performance

(Brynjolfsoon, 1995). In any event, there still remains much uncertainty regarding with factors

actually influence or determine the contribution of ICT to business performance (Weill, and

Broadbent, 1992). The foregoing scenarios indicate that firm performance is likely to be

determined by the interaction of various factors (Cragg et al 2002). In fact, some researchers

argue that the impact of ICT on performance may not be a direct one, but that it is often mediated

by other factors (Chan et al, 1997). This underscores the importance of aligning IT with the

firm’s strategy to ensure that ICT is used strategically to leverage business performance, hence

making it a “good servant rather than a bad master” (Revell, 1997). This issue of alignment is


particularly important within the context of SMEs given the paucity of research in this arena and

the limitations associated with small size.

Several researchers (Porter, 1985; Das, 1991; Henderson et al, 1989, 1993) have posited the need

of business organizations to align ICT management activities with firm strategy. In fact, many

have suggested that strategic alignment is one of the most important requirements for effectively

managing IS (Venkatraman, 1986; Burn and Szeto, 2000). Interestingly, although ICT has been

adopted by many SME’e, the research findings suggest that in practice many firms struggle to

achieve alignment (Reich and Benbasat, 1996). It must therefore become a strategic imperative

that SMEs strive to overcome the obstacles to develop a fit between ICT adoption and IT

strategy and their business strategy.

Some researchers have examined how SMEs can in fact align IT strategy with their business

strategy. For instance, there is a suggestion that SMEs should adopt some sort of a framework for

planning IT if they desire to create an IT based strategic advantage (Blili and Raymond, 1993).

In addition, other researchers have proposed an approach aimed specifically at SMEs to help

them align their IT and business strategies (Levy and Powell, 2000). Although the reports of the

latter have been encouraging, the researchers have yet to report an evaluation of the effectiveness

of their IS strategy development approach (Cragg et al 2002). However, other studies have

provided evidence of ICT adoption being used strategically by SMEs in a more specific context;

for example to gain competitive advantage from the use of the Internet (Poon, 2000).

However, the overwhelming research findings suggest that in practice, SMEs do not have the

requisite resources to use IT strategically (Cragg et al, 2002). This may be attributed to a number

of factors including limited time and IT expertise (Mehrtens et al, 2001); the tendency not to

develop IS strategies (Hagmann and McCahon, 1993). It is evident from the literature that ICT

alignment can be of central importance in understanding the link between ICT adoption and

performance in business organizations. It may also be inferred that additional research needs to

be conducted to better understand this link.


Benefits of ICTs to SMEs

Several authors have identified ways in which SMEs can benefit significantly from the adoption

of ICT. As an example, UNDP-APDIP (2005), has suggested the following benefits:

1. Increased productivity in the production process (e.g. improved inventory management

systems, decreased wastage in production processes)

2. Increased efficiency of internal business operations (e.g. improved accounting and

budgeting practices, improved communication between different departments within the

firm)

3. Easier and cheaper connection to external contracts, whether locally or globally (e.g.

expanded client base through e-marketing, reduced communication costs and geographic

barriers with global suppliers and clients, new methods of payment through e-commerce)

4. Linkage to local and global supply chains and outsourcing opportunities

5. Simplified government services such as business registration and filing taxes

Windrum, Berranger (2002), looked at the commercial benefits of e-business and proffered

several areas of benefit.

1. Significant opportunities exist for SMEs to expand their geographical reach.

2. Important cost benefits lie in improved efficiency in procurement, production and

logistics processes.

3. There is enormous scope for gaining competitive advantage through improved customer

communications and management. Customer care websites are now becoming

increasingly common.

4. The internet reduces barriers to entry for new market entrants and provides and

opportunity for small firms to re-orientate their supply chain relationships to forge new

strategic partnerships.

5. The technology facilitates the development of new types of products and new business

models for generating revenues in different ways.


6. There is the opportunity to transform SMEs into information – driven businesses. The

technology offers, for the first time, an affordable means of capturing and processing the

information generated through electronic transactions.

Challenges faced by SMEs in accessing ICT:

SMEs are not generally exploiting fully the benefits of ICT due to several challenges to adoption.

A major challenge for SMEs has been the exploding advancement and the ever-growing ICT

developed within the past few decades. In some cases they are lacking the resources, and

technical and business skills to successfully adopt ICT. This lack of skills makes the

introduction of e-business and knowledge management to gain competitive advantage largely

unworkable in SMEs (Cela, 2005 cited in Barba-Sanchez et. al., 2007; Maguire 2007).

Most SMEs perceived the barriers of implementing IT into their business operations as

expensive and risky initiative. (Yeung et al., 2003; Chong et. al., 2001; Pires and Aisbett, 2001)

cited in Alam & Ahsan, 2007.

In addition, SMEs do not have appropriate guidelines and models to allow them to take

advantage of the developing knowledge economy and move towards the e-business era.

(Maguire 2007), and are also constrained by the use of obsolete technologies (Mutula and

Brakel, 2006). Similarly, UNDP- APDIP (2005), posit that that SMEs are faced with constraints

to adoption such as, limited ICT literacy , high fixed cost, poor communication infrastructure,

inexperience in integrating ICTs into the business process, undeveloped legal policy for

electronic payment and security issues.

Understanding the benefits and drawbacks of implementing ICT solutions has the potential to

increase the competitiveness of local SMEs to access wider geographic markets (Shiels et al

2003) and to allow them to be better positioned to fully exploit the myriad of opportunities that

are available from these opportunities.


THE ADOPTION OF ICT IN JAMAICAN SMEs

Regional Perspective

Various analyses of the Caribbean region have generated similar findings that suggest that while

liberalization result in improved access to telecommunications and Internet services, exorbitant

prices persist due to the telecom monopolies and small markets. Adoption and reliability fall

below expectations, with obvious variations existing among countries (OTF Group, 2005).

Educational attainment is also an important challenge in the region. A popular misconception is

that the skill level in the Caribbean is relatively high. While primary education is universal, with

enrolment rates of more than 90 percent in 2002, and secondary schooling is improving, tertiary

levels are one of the region’s biggest educational weaknesses (OTF Group, 2005) (see Figure 2).

Figure 2


This weakness has contributed to the continuing dominance of low-skilled sectors in the

economy, where ICT usage is less common, and where long-term economic growth opportunities

are limited. Technology adoption and diffusion will improve with increasing levels of education.

However, many government and business people in the Caribbean do not see the practical link

between ICT and the development of their economies (OTF, 2005).

The English-speaking Caribbean continues to be the only regional block of the world that is yet

to develop a software exporting capability; (Duggan, 2008) citing research conducted by

Professor Erran Carmel of American University. This deficiency may be a consequence of the

weaknesses outlined earlier.

Jamaican Perspective

Despite the liberalization and privatization of the communication sectors in the Jamaican

economy, the cost of communications remains one of the major impediments to the adoption of

e-business technologies (Lal, 2009). Within this context, the National ICT Strategic Plan, 2007-

2012, was commissioned by the government and formulated by Dunn and Duggan (2006).

This Plan outlines major policy objectives in support of SMEs, in their efforts at taking greater

advantage of ICT for strategic and operational effectiveness. Objectives in the Plan directly

related to SMEs are:

Providing technical assistance for SMEs to engage in ecommerce operations

Promoting awareness among SMEs of the benefits to be derived from the greater

adoption and use of ICTs in their operations

The inclusion in the Plan of some focus on SMEs, signals the commitment of the government to

supporting the growth and development of SMEs through ICT. Consistent with this policy

objective, the government has put focus on increasing the competitiveness of SMEs by providing

access to business related information, delivering technology-based training utilizing Business

Information Centres located islandwide and promoting the use of e-commerce tools among

entrepreneurs to enable access to new markets locally and internationally (PIOJ, 2007),


JAMAICAN SME STUDIES:

This section will highlight two studies of Jamaican SMEs. The first was conducted on domestic

market SME’s drawn from the membership of the Small Business Association of Jamaica. The

second study represents a case study on two firms which have benefited from the adoption of

ICT in their operations. The findings are expected to provide insights into the ICT adoption

process and inform SMEs attempting to embark on a similar path.

A study on 60 non-exporting Jamaican SME’s was conducted in 2004 aimed at determining the nature

and level of ICT adoption, the barriers and impediments to ICT use, the learning processes employed in

ICT adoption (Lal, 2009). Using data from 60 SME’s, it was found that the academic background of

managing directors emerged as significant in discriminating varying degrees of ICT use among SME

firms, in the customisation of ICT tools and in selecting appropriate technologies . Learning by doing,

external training by professional institutions emerged significant as the mode of knowledge acquisition.

High costs, and slow speed, of telecommunications was detected as a major constrains. (Lal, 2009).

Attribute Firm A Firm B

Industry: Financial Services Business Consulting Services

Type of Business: Brokerage and Cambio Geospatial Products and Services

Years in Operation: 14 years; 11

Employees: 22 15

Annual Turnover: J$167 million $153 million

ICT Investment: CRM system for client funds

management , Funds

Management, Loans / Letters of

Credit, FX Sale, Statements to

Customers, Sale / Purchases of

GoJ Instruments, Accounting,

Leverages the internet for funds

management, supply chain, in-

bound logistics, marketing. Very

deliberate in investments (eg

converted from Excel based

accounting to Intuit Enterprise

solutions just within the last 6


Personnel (Payroll)

months, due to tax reporting

issues)

Investment Date:

2007 continuous since 1998

Comments:

The company had the necessary

IT expertise. Immense benefits

were realised. Accrued benefits

outweigh the costs involved.

Internet access has greatly

improved customer service and

reduced number of calls serviced

by in-house staff.

The company has the necessary

IT expertise on its staff. Immense

benefits realised. Acquisitions

have been relatively low-cost.

Accrued benefits the costs

involved. Internet access has

greatly improved customer

service, reduced number of calls

serviced by in-house staff. The

high-tech nature of the

organization allowed for faster

ascent of the learning curve.

Assessment of

Competitive

Advantage:

Increased customer base,

reduced the costs of customer

servicing.

Increased customer base; reduced

the costs of servicing. Internal

efficiencies, resulting in

decreased costs.

Challenges: Expensive acquisition. Absence

of a dedicated project team

hindered the timeliness of

implementation.

No major challenge


Common Patterns / Lessons Learned:

1. The educational level of the top management team allowed the firm to be aware of the

potential business benefits of adoption of ICT

2. The implementation of the system reduced costs and improved efficiency thereby

creating higher customer value and enhancing competitive advantage.

3. Access to IT resources enabled the firms to prove feasibility of the project and also

enabled the implementation process

4. Incremental adoption of ICT resulted in better screening and selection of ICT and more

efficient spend of adoption

.

RECOMMENDATIONS:

In view of the arguments and discourses presented in the paper on different issues pertaining to

the adoption of ICT in SMEs, it is imperative that strategies are developed, at all levels, to

further SMEs growth, development and competitive advantage. It is against this backdrop that

the following recommendations are forwarded for consideration.

The OTF(2005), identified several actions that can be taken by governments in the Caribbean, to

facilitate national development and to create an enabling environment for SMEs to flourish

through the adoption of ICT.

1. Facilitate Access - Access to technology is essential for firms and clusters to compete

globally. In the Caribbean, the situation is suboptimal in this regard, with some of the highest

connectivity prices, and in general, uncompetitive telecommunication markets.

2. Support Services for Firms - The availability of support services and financing for startups,

particularly in technology-based businesses, is almost non-existent in the region. The failure to


deliver funds and technical capabilities to small ventures is the largest impediment for their

growth.

3. Regional Harmonization in Key Policy Areas Related to ICT - As more people turn to ICT

to do more of their day-to-day operations, it is imperative that legislation is kept attuned to ICT

and its use. The more legislation is harmonized in the region and compatible with international

standards, the greater the benefit to these economies and their attractiveness to foreign investors.

4. Technology Clusters Must Make Business Sense – The High technology clusters do offer

the potential for positive spillover in the Caribbean. An attractive incentive model has to be

developed to stimulate the creation of these clusters..

Whether regional firms and governments use ICT to become smarter or merely cheaper, will

determine whether it is the key to increasing wealth or simply slowing the decline into poverty.

For Jamaica in particular, the following actions are also recommended:

1. The Mona School of Business should develop a Centre of Excellence specific to SMEs

which would utilise the skills of recent graduates of the PhD in Information Technology

programme, to spearhead research and provide leadership to SMEs in the incorporation

of ICT in their operations.

2. Tax Incentives should be given for ICT adoption in high-value SME’s particularly firms

engaged in export-markets. cited in Martin and Matlay, 2001)

3. Infusion of ICT in the curricula of educational institutions at all levels.

4. Increasing the number of technical training institutions, such as HEART TRUST/NTA,

offering ICT in order to provide an e-skilled workforce to meet the demand of the current

knowledge economy.

5. Incentives should be devised to encourage the development of the software applications

sector (

CONCLUSION


In concluding, ICT is a critical tool which if deployed and infused effectively by SMEs can

positively impact their growth and competitiveness. As such, the powers that be have to ensure

that there is an operationalised national policy which is dedicated to the sector and that the

requisite support and infrastructures established to see to its well-being.


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