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Information and communication technologies (ICT) have influenced almost all sectors including education, health, bank and entertainment to name a few. Business organizations are rapidly investing in ICT because, there so many advantages attached to it. Many researchers have proven that there is a significant impact on ICT and business performance (Hajli & Sims, 2015; Melville, Kraemer & Gurbaxani, 2004; Halachmi,1988).
Small and medium enterprises (SMEs) play a major role in any economy. They generate employment, introduce new business methods and products, reduce poverty, inflation and income inequality and solve the balance of payment problem (Prasad, Tata & Guo, 2012; Zeinalnezhad, Mukhtar and Sahran, 2011; Singh, Garg and Deshmukh, 2010; Tambunan, 2008, as cited in Priyanath & Premarathne, 2014).
ICT helps particularly in SMEs to create business opportunities and to compete profitably. According to Parida et al. (2010) Information technology (IT) helps to eliminate cost by improving internal processes, providing faster communication with SMEs’ customers and better promoting and distributing their products via online. The value chain concept developed by Michel Porter views the firm as a series, or a network which consists of basic and secondary activities and particularly basic activities that add value to its products and services and ultimately leads to achieve competitive advantages (Porter & Michael, 2001). Hence this framework provides an image of a company to achieve competitive advantage by implementing competitive strategies through the value chain. According to Obrian and Marakas (2010) implementing IT through the value chain adds value to a company’s products and services consequently enhance the overall business value of the company.
Many SMEs implementing IT for their business and enjoy many benefits attached to it. Enhancing productivity and effectiveness of certain activities or functions, assist in the adoption of new organizational, strategic and managerial models that enable access to new environments, as well as the generation of new markets and business model (Brady et al., 2002; Kahn, 1996, 2001; Javalgi & Ramsey, 2001; Corbitt, 2000; Johnston & Lawrence, 1998 as cited in Barba-Sánchez, 2007).