Global Perspectives on Small and Medium Enterprises and Strategic Information Systems: International Approaches

Global Perspectives on Small and Medium Enterprises and Strategic Information Systems: International Approaches

Pratyush Bharati (University of Massachusetts, USA), In Lee (Western Illinois University, USA) and Abhijit Chaudhury (Bryant University, USA)
Release Date: April, 2010|Copyright: © 2010 |Pages: 410
ISBN13: 9781615206278|ISBN10: 1615206272|EISBN13: 9781615206285|DOI: 10.4018/978-1-61520-627-8


Small and medium-sized enterprises (SMEs) play a critical role in rejuvenating and sustaining the modern economy, generating substantial employment and serving as important innovation engines for the global economy.

Global Perspectives on Small and Medium Enterprises and Strategic Information Systems: International Approaches aims to spread research conducted on SMEs internationally and place it at the disposal of academics, practitioners, consultants, the vendor community, and policymakers. The goal of this book is to highlight the challenges faced by SMEs and how they are coping with the adverse environment through skillful use of IT and technologies such as Web 2.0, Enterprise Resource Planning (ERP), e-commerce, open source software, Business Process Digitization (BPD), and other emerging technologies.

Topics Covered

  • Agile Software Development
  • Business Process Digitalization
  • E- Commerce
  • E-Business
  • Enterprise Resource Planning (ERP) Systems
  • Micro-Enterprises
  • New Product Development
  • Small and Medium Enterprises (SMEs)
  • Strategic Information Systems
  • Web 2.0

Table of Contents and List of Contributors

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Editorial Advisory Board
Table of Contents
Pratyush Bharati, In Lee, Abhijit Chaudhury
Chapter 1
Efthymios Constantinides
This chapter explains the nature, effects and current standing of the new generation of Internet applications, commonly known as Social Media or Web... Sample PDF
Connecting Small and Medium Enterprises to the New Consumer: The Web 2.0 as Marketing Tool
Chapter 2
Arvind Karunakaran, Sandeep Purao, Brian Cameron
Small and Medium Enterprises (SMEs) in legacy industrial era regions face unique challenges that vary from the challenges faced by SMEs in other... Sample PDF
Leveraging University Research to Assist SMEs in Legacy Industrial Era Regions: The Case of I-99 Corridor
Chapter 3
Julie E. Kendall, Kenneth E. Kendall
It is often assumed in the MIS literature and in practice that only large organizations are capable of transmitting culture and information... Sample PDF
IT and the Transmission of the SME Culture of Nonprofit Theatres
Chapter 4
Andreja Pucihar, Gregor Lenart, Frantisek Sudzina
This chapter presents the importance of ERP system selection criteria for SMEs. Altogether, 28 ERP selection criteria were investigated. The... Sample PDF
ERP System Selection Criteria: SMEs’ Perceptions
Chapter 5
Susan J. Winter, Connie Marie Gaglio, Hari K. Rajagopalan
To succeed, SMEs must create legitimacy by mimicking the cues that signal credibility to convince potential stakeholders that something stands... Sample PDF
Managing Impressions of SME Legitimacy: Valuing Information and Communications Technologies as Signals and Symbols
Chapter 6
Sandy Chong
Since July 2003, Australia demonstrated the promotion of EC outside the country by forming an international EC partnership with Singapore. While... Sample PDF
A Comparative Study of Small- and Medium-Sized Enterprises in Australia and Singapore: Overall Satisfaction of Electronic Commerce Implementation
Chapter 7
Ada Scupola
This chapter presents the results of a study on factors affecting adoption of e-commerce in small and medium size enterprises in Australia. The... Sample PDF
Australian SMEs and E-Commerce Adoption: Newer Perspectives
Chapter 8
Robert C. MacGregor, Deborah Bunker, Mira Kartiwi
Electronic commerce (e-commerce) has been utilised as a vehicle to rapidly transform the world into an information society. Yet despite the proven... Sample PDF
The Perception of Barriers to E-commerce Adoption by SMEs: A Comparison of Three Countries
Chapter 9
Jaume Franquesa, Alan Brandyberry
This study explores the relevant dimensions of organizational slack in small and medium enterprises (SMEs) and investigates their impact on adoption... Sample PDF
The Role of Organizational Slack in Technology Innovation Adoption for SMEs
Chapter 10
Peter Marshall, Phyl Willson, Judy Young, Kristy de Salas
This chapter describes the development and testing of a method for information systems (IS) strategy formulation in small and medium enterprises... Sample PDF
The Dual Lens Method: A Practical Approach to Information Systems Strategy in SMEs.
Chapter 11
Pattama Kanavittaya, Jocelyn Armarego, Paula Goulding
The alignment of business strategy and IT strategy has been recognised as a strategic weapon within organisations. Small and medium sized... Sample PDF
The Alignment of Business Strategy with Agile Software Development within SMEs
Chapter 12
Tom R. Eikebrokk, Dag H. Olsen
The low e-Business implementation in small and medium-sized enterprises (SMEs) is an important issue in most countries. This chapter examines the... Sample PDF
Supporting SMEs Towards E-Business Success: Exploring the Importance of Training, Competence and Stimulation.
Chapter 13
Frank Schlemmer, Brian Webb
SMEs frequently suffer from resource poverty. The authors suggest that the Internet can be used to leverage their strategic assets and propose a... Sample PDF
Deploying the Internet for Leveraging Strategic Assets
Chapter 14
Jun Li, Michael Merenda
Previous research has largely ignored how business process digitalization across the value chain enhances firm innovation. This chapter examines the... Sample PDF
Business Process Digitalization and New Product Development: An Empirical Study of Small and Medium-Sized Manufacturers
Chapter 15
Sajda Qureshi, Mehruz Kamal, Peter Wolcott
The use of Information and Communication Technologies (ICTs) by Small and Medium Sized Enterprises (SMEs) have the potential to enable these... Sample PDF
Information Technology Interventions for Growth and Competitiveness in Micro-Enterprises
About the Contributors


Small and medium-sized enterprises (SMEs) play a critical role in rejuvenating and sustaining the modern economy. They generate substantial employment and serve as important innovation engines for the world economy. In the US, which is known for large multinational corporations (MNCs), SMEs are still considered indispensable. According to the Small Business Administration (SBA), they employ half of all private-sector employees, pay more than 45% of total US private payroll, have generated 60-80% of net new jobs annually over the last decade, and currently employ 40% of high-technology workers such as scientists, engineers, and computer workers. SMEs should be an important subject for IS academic researchers to study. Unfortunately, only a few papers on the subject have been published in the top IS journals worldwide. This book attempts to fill this void.

This book aims to spread research conducted on SMEs internationally and place it at the disposal of academics, practitioners, consultants, the vendor community, and policymakers. The goal of this book is to highlight the challenges faced by SMEs and how they are coping with the adverse environment through skillful use of IT and technologies such as Web 2.0, Enterprise Resource Planning (ERP), e-commerce, open source software, Business Process Digitization (BPD), and other emerging technologies. The book covers SME-relevant IS topics such as IT strategy, IT diffusion and implementation, business and IT alignment, leveraging of IT assets, knowledge networks, IT innovation, training and performance, and legitimacy building through IT. Each chapter comprises original and cutting-edge research, grounded in field studies by international researchers, with both theory and practice implications for SMEs. In total, the book has three sections and fifteen chapters.

The first section consists of chapters that focus on practical challenges faced by SMEs regarding analysis, implementation, and effective use of IT. The second section focuses on barriers to adoption of information technology innovations. The third section comprises chapters on strategy formulation, IT and business alignment, the dynamic capabilities of an SME, and SME innovation strategies.

Section One: Practical Information System Challenges

Chapter One, by Efthymios Constantinides, presents the nature, effects, and position of social media or Web 2.0. This chapter identifies the main approaches corporations follow in engaging Web 2.0 applications in order to support, complement, or improve their traditional and online marketing activities. These approaches aim at using the social Internet as a source of marketing intelligence and for communicating with customers. The authors propose a classification of the main social media applications and identify the options for SMEs willing to utilize Web 2.0 technologies.

Chapter Two, by Arvind Karunakaran, Sandeep Purao, and Brian Cameron, highlights the challenges faced by SMEs in legacy industrial era regions by focusing on the specific case of the I-99 corridor in the state of Pennsylvania. It discusses a structured approach toward enabling the SMEs in this region to access extended and powerful knowledge networks through a joint effort working toward regional economic development. The chapter describes the LAIR (Leveraging Advanced IT Research) project, which is aimed at understanding the risks that SMEs in the I-99 corridor are likely to face as they grow, with a specific focus on risks associated with upgrading, implementing, and integrating their information systems.

Chapter Three, by Julie E. Kendall and Kenneth E. Kendall, uses the framework provided by the metaphor of the third space as proposed by Bhabha (1994 and 1996). It elaborates on the diffusion of Broadway production business practices to small and medium-sized nonprofit theaters. The authors discover that both groups possess unique cultural competencies that open the door to using Web 2.0 technologies for staging and promoting productions and building relationships with theater patrons. They also discuss other management issues where expertise can be mutually exchanged.

Chapter Four, by Andreja Pucihar, Gregor Lenart, and Frantisek Sudzina, presents the importance of ERP system selection criteria among SMEs in Slovenia. The investigated criteria were grouped into ERP benefits criteria, system quality criteria, vendor-related criteria, and ERP package criteria. System reliability, system functionality, vendor support, business process improvement, and improved service levels were perceived as the important ERP system selection criteria for small and medium-sized companies in Slovenia.

Chapter Five, by Susan Winter, Connie Gaglio, and Hari Rajagopalan, advises SMEs to create legitimacy by mimicking the cues that signal credibility to potential stakeholders interacting with the firm. The authors examine the role of information and communications technology (ICT) in legitimacy-building from the perspectives of SME founders and potential customers.

Section Two: Innovation and Information Technology Assimilation

Chapter Six, by Sandy Chong, examines the differences in electronic commerce (EC) implementation of SMEs in Australia and Singapore. The results show that respondents’ perceptions of EC are predominantly positive. The analysis of Australian firms shows that five factors—observability, communication channel, customer pressure, supplier pressure, and perceived governmental support—make a significant contribution to the implementation of EC. In contrast, for firms in Singapore only three factors—firm size, perceived readiness, and observability—have significant impact. The author provides useful insights to adopters of EC initiatives in both countries.

Chapter Seven, by Ada Scupola, studies the factors affecting adoption of electronic commerce in small and medium enterprises in Australia. The author uses the Tornatsky and Fleischer (1990) model to investigate the impacts of environmental, organizational, and technological factors, and finds that the external environment has an influence mainly through customers’ requirements and availability of IT services. The results of this study are contrary to other studies, which found that government and public administration play a significant role.

Chapter Eight, by Robert MacGregor, Deborah Bunker, and Mira Kartiwi, examines the barriers to e-commerce perceived by SME owners and managers in the developing country of Indonesia. It then compares these perceived barriers with those in two developed economies, Sweden and Australia. The study highlights the differences in barriers to e-commerce adoption among the three countries.

Chapter Nine, by Jaume Franquesa and Alan Brandyberry, investigates the impact of organizational slack in US small and medium-sized enterprises (SMEs) on the adoption of information technology (IT) innovations. The authors find that the slack-innovation relationship, previously described for large firms, does not hold for SMEs. Their results show that potential slack is a strong predictor of technology adoption, whereas available slack is not a significant factor in SME innovation adoption. The authors argue that, in some cases, innovation adoption may represent a form of “bricolage” by resource-constrained SMEs.

Section Three: Strategy and Information Systems

Chapter Ten, by Peter Marshall, Phyl Willson, Judy Young, and Kristy de Salas, presents a method of IS strategy formulation in SMEs. The method draws on the work of Levy and Powell (1999, 2000). A case study describes their experience with this method. The method is comprised of two complementary analyses: an externally focused strategic analysis and an internally focused business process analysis. The authors emphasize the importance of relevance and practicality in selecting the method in practice.

Chapter Eleven, by Pattama Kanavittaya, Jocelyn Armarego, and Paula Goulding, studies the challenge of aligning business strategy and information technology (IT) strategy. The authors examine the adoption of agile methods by SMEs in developing software products and suggest that agile methods may facilitate the alignment of business and IT strategy. Models of strategic alignment developed for large enterprises are also validated for SMEs.

Chapter Twelve, by Dag Olsen and Tom R. Eiekbrokk, examines the relationship between training and performance in SMEs and discusses practical implications. They find a positive relationship between training, competence, and performance. The authors show that training explains variances in e-business competences and performance in terms of efficiency, complementarities, lock-in, and novelty. The study has practical implications for public policy makers, training suppliers, and SME managers.

Chapter Thirteen, by Frank Schlemmer and Brian Webb, investigates how a firm can use the Internet to leverage its strategic assets. They propose a theoretical framework with variables such as business resources, dynamic capabilities, and IT assets, and suggest that firm managers create competitive advantage by identifying strategic assets that complement the Internet. They also warn against the threat of overinvestment in IT assets at SMEs.

Chapter Fourteen, by Jun Li, Michael Merenda, and A.R. Venkatachalam, examines the relationship between the extensiveness of business process digitalization (BPD) and new product development (NPD). The authors find that NPD is positively related to the extensive use of BPD, and the relationship between NPD and the extensiveness of BPD is stronger in more mature firms than in younger firms. They conclude that SME innovation strategies are positively associated with the strategic use of BPD and span spatial, temporal, organizational, and industry boundaries, thus aiding SME global competitiveness.

Chapter Fifteen, by Sajda Qureshi, Mehruz Kamal, and Peter Wolcott, studies the challenges faced by micro-enterprises in implementing ICT technology. They find that very few micro-enterprise entrepreneurs possess the technical skills necessary to achieve the benefits that streamline their business operations and help them compete and expand into new markets. The authors employ a focus-dominance model to investigate trends in incorporating and adopting ICTs. They demonstrate how IS combined with context-sensitive IT assistance increases awareness of information systems and predicts future usage of IT.

Author(s)/Editor(s) Biography

Pratyush Bharati is an Associate Professor in the Management Science and Information Systems department of College of Management at the University of Massachusetts. He received his Ph. D. from Rensselaer. His present research interests are in: international software services industry, diffusion of information technologies in small and medium sized enterprises (SMEs), web-based decision support systems and service quality. His research has been published or is forthcoming in several international journals including Communications of the ACM, Decision Support Systems, IEEE Computer and IT and People.
In Lee is a professor in the School of Computer Sciences at the College of Business and Technology at Western Illinois University in the US. He is a two-time winner of the Research Excellence Award in the College of Business and Technology at WIU and is the founding Editor-in-Chief of the International Journal of E-Business Research. He has published his research in such journals as Communications of the ACM, IEEE Transactions on Systems, Man and Cybernetics, IEEE Transactions on Engineering Management, International Journal of Production Research, Decision Support Systems, Computers and Operations Research, International Journal of Production Economics, Business Horizons, Knowledge and Process Management, Journal of Small Business Management, Management Decision, Computers and Education, International Small Business Journal, Computers in Human Behavior, Business Process Management Journal, Computers and Industrial Engineering, and others. Prior to his academic career, he worked for a number of multinational corporations, as well as serving as a consultant for various government agencies and private organizations. His current research interests include web technology development and management, investment strategies for computing technologies, and mobile services. He received his PhD in Business Administration from the University of Illinois at Urbana-Champaign.
Abhijit Chaudhury is a Professor of Information Systems at Bryant University. He received his Ph. D. from Purdue university. His present research interests are in diffusion of technologies such as web services, cloud computing and management of IT services in small and medium firms. His research has been published or is forthcoming in several international journals including MIS Quarterly, Information Systems Research, Communications of the ACM,and Decision Support Systems.