INFORMATION TECHNOLOGY

Information Technology Adaption in SMEs

Information Technology Adaption in SMEs

Turban et al. (1999: 5) stress that IT is becoming the major facilitator of business activities in the world today. Other researchers too have pointed to this fact in earlier works. Dertouzos (1997) informed us (as in Turban et al. 1999: 5) that IT is an active facilitator of basic changes in the structure, operation and management of firms, due to capacity enhancement. A literature review revealed that studies examining the association between IT and organizational performance are divergent in their conceptualization on key constructs and their inter-relationships.

According to Turban (1999), previous research has shown that IT utilization in firms' operations contributes to the improvement of their organizational performance. This is confirmed in other works such as Brynjolfsson and Hitt (1996). The value created in business due to the utilization of IT depends on various factors, which includes the type of IT, management practices, and organizational structure, as well as the competitive and macro environment. In 1994 it was expressed the view that IT has changed the performance dynamics of enterprises and made them flatter, smaller and faster in performing their operations.

Many researchers worked with developing models for prediction of Small Medium-sized Enterprises' (SMEs) performance as well as different firm dynamic theories. The two researchers, in their review of firm performance modes, studied a spectrum of factors and parameters affecting the performance of SMEs. Some of these factors are financial while others are non-financial. Scholars studied internal and external parameters affecting a firm's performance. Because of the many factors, which may affect SMEs' survival, success and growth, studying them needed a tool of categorization. A first attempt to achieve that was attempted by Crick and Dana (2004).

The two scholars, using the internal and external classification system, provided a summary of the factors that have been found in previous studies, to motivate firms to export. Abouzeedan (2002) developed a tool for the classification of parameters affecting small firm performance, the SPF classification system. In the SPF system, the performance related factors are dichotomized into two types of parameters. The first group is 'internal' factors or parameters and the second group is the 'external' parameters (Davenport, Prusak, 1998, 23-29).

The 'internal' parameters cover all that is mostly related to the internal environment within the company. The 'external' factors, on the other hand, are related to the external environments in which the business is embedded.

Abouzeedan and Busler (2009) used the SPF classification system to run a semi topology analysis on the existing firm performance evaluation models. The two writers found that the SIV model is one tool which has the widest range of parameters represented in accordance with the SPF classification system. Understanding the relationship between a firm's internal environment and the external environment surrounding the firm is of extreme importance while studying the various bridging tactics including strategic alliances (Denning, 2000, 34-42).

The New Economy of the Information Technology Information technology tools are dramatically transforming today's economy at different levels and in diverse ...