“Information and communications engineerings have considerable possible to advance development and economic growing. In the custodies of developing states, and particularly small- and moderate-sized endeavors ( SMEs ) , the usage of ICTs can convey impressive additions in employment, gender equality and criterions of life ” -Kofi A. Annan-
The function of ICT and e-commerce / e-business in back uping socio-economic and sustainable development in developing states has been emphasized since the last decennary of the millenary, particularly by international establishments, including the United Nations, OECD ( Organization for Economic Co-operation and Development ) , and other organisations in different graduated tables.
Comparing to researches analyzing the acceptance and deductions of e-business in developed states, little figure of researches is covering the same subject for developing states ( Travica, 2002 ) . Among those, even fewer researches concentrated on small- and moderate-sized endeavors ‘ ( SMEs ) acceptance of e-business, and the function local concern support Centres can play in advancing e-business in developing states ( UNCTAD, 2004 ) .
The presented survey is seeking to make full this spread, and aims at measuring the factors impacting SMEs ‘ usage of cyberspace for concern and the willingness of local concern support Centres to offer concern related web based services. What the writer means by concern support Centres in this survey is any organisation working on back uping entrepreneurship or SMEs concern in developing states. This definition can be applied on different types of organisations including NGOs, governmental governments, development foundations, private enterprises and others.
Due to those different types, and as the survey will concentrate on e-business chances for SMEs, concern support Centres will be named as “ SMEs Centres ” through the survey from now on.
1.1 The company and the undertaking
The survey will be based on a proposed undertaking by “ BiD Network ” , a Dutch non- net income organisation working on associating SMEs and enterprisers in developing states with investors all over the universe, to excite entrepreneurship and economic growing in emerging markets. The company end is to assist with poorness decrease through back uping SMEs and enterprisers in developing states by offering different services including: coaching, concern programs competition and matchmaking with investors interested in emerging markets.
The company is sponsored by 4 chief spouses back uping its activities: NCDO
( National Committee for International Cooperation and Sustainable Development ) , ICCO, Dutch Postcode Lottery and Dutch Ministry of Foreign Affairs. At the same clip, BiD Network has 11 national spouses ( SMEs Centres ) active in assorted developing states ( Argentina, Bolivia, Colombia, Ecuador, Mexico, Peru, Jordan, Kenya, Uganda, Rwanda, Tanzania, and the Philippines ) .
The chief services offered by BiD Network, aiming SMEs and enterprisers in developing states, are concern program appraisal, concern coaching, concern program competitions and matchmaking with investors. The company is besides offering investing services to interested investors.
For the clip being, BiD Network has its ain online platform, where all above mentioned services are offered. In add-on to the mentioned services, the platform contains an online community, where about 25000 enterprisers from all over the universe are registered. Through the online community, the enterprisers have the possibility to ( i ) submit their concern programs for Business Plans Competitions or investors matchmaking service, ( two ) acquire on-line coaching, with entree to international managers, and ( three ) contact each other as an online societal web. For the clip being, enterprisers are registering on BiD Network online community and acquiring all those services for free.
The online community has besides other types of members, including over 400 managers, who coach the enterpriser for concern programs composing, and about 100 investors, who have entree to look into sanctioned concern programs for new concern chances.
BiD Network is sing now a new concern theoretical account with new web based services. The proposed undertaking is to spread out the current online community to a planetary entrepreneurship web, where SMEs Centres from assorted developing states are connected.
In the proposed undertaking, each SMEs Centre will be registered on BiD Network online community, has the right to utilize BiD Network services and to advance those services to the Centres ‘ members. At the same clip, and on BiD Network platform, each SMEs Centre will hold its ain online community including its local members of SMEs, managers, investors and concerned establishments.
At the terminal, the multiple webs will be connected to each other on BiD
Network platform, making a planetary societal web for SMEs, enterprisers, and SMEs Centre from developing states, in add-on to concerned investors, managers and establishments from the whole universe.
Though SMEs and enterprisers are utilizing the current online community as free of charge, BiD Network is sing altering its concern theoretical account and would wish to measure the ability of SMEs Centres to pay a subscription fee to go a member in the proposed planetary online web and utilize the proposed web based services.
1.2 Undertaking Aims
As the proposed undertaking by BiD Network is an advanced undertaking, which is to be applied for the first clip within the development industry, this exploratory survey is seeking to reply different inquiries related to SMEs ‘ and SMEs Centres ‘ attitude towards web based services, and in peculiar the 1s proposed by BiD Network.
As measuring the on-line behavior of SMEs and SMEs Centres in all developing states requires a batch of resources and clip beyond the range of this undertaking, therefore the survey range has been identified by 10 developing states, with concentration on Africa, Middle East and Asia. ( More inside informations about this are provided under the methodological analysis subdivision ) .
The survey will seek to measure the impression of utilizing e-business in developing states utilizing 3 degrees, SMEs, SMEs Centres and Country e-readiness.
The Study aims will be as follows:
• Assessing SMEs Centres ‘ attitude towards web based services, including their current offered web based services, and their involvement in BiD Network proposed services.
• Measuring SMEs involvement and preparedness for utilizing web based services and factors impacting their acceptance of e-business
2 Literature reappraisal
In this chapter we will seek to research the background and anterior researches related to the discussed subjects in the presented survey. This geographic expedition will be a way to understanding and analysing the gathered primary informations. Very limited researches were found covering the function of SMEs Centres with e-business publicity in developing states, while comparatively more were found covering factors impacting SMEs acceptance of e-business. As the presented survey is taking to analyse the specified aims utilizing the three degrees: SMEs Centres, SMEs and Country e-readiness, the following subjects will be covered in the literature reappraisal: e-business and development, e-business and SMEs, and e-readiness.
2.1 E- Business and Development
2.1.1 What is e-business?
While suggesting a name for this survey, the writer faced the ageless inquiry of: should it be named e-business or e-commerce? Actually, though the demand of differentiation, both footings have no one unequivocal significance that is universally established, and are frequently used interchangeably in pattern ( Tassabehji, 2003 ) . In the context of development, Payne ( 2002 ) suggests a wide definition for ecommerce as: “ Any usage of information and communications engineering ( ICT ) by a concern that helps it bettering its interactions with clients or providers ”
Though this definition suits the presented survey in a portion, it does non mention to the strategic side of BiD Network proposed undertaking, and does non set accent on making concern over the cyberspace. Checking e-business term ‘s definitions and uses, the writer thinks that the term e-business would suit better with the proposed survey. In the presented survey e-business will mention to a broader definition of e-commerce that besides includes join forcesing with concern spouses and carry oning electronic minutess within an organisation ( Turban, 2008 ) . And where the term itself is used as an applied construct to scheme, operations and concern which chiefly is runing online ( Chaffey, 2007 ) .
2.1.2 Development and developing states
The term “ Development” refers merely to the organic structure of activities concentrating on developing low developing states ( LDCs ) . The Development theory has evolved get downing 1950s when solutions were sought to assist transforming states from Africa, Latin America and Asia into western-type societies ( Akpan, 2003 ) . Klein and Nason ( 2001 p. 263 ) , argue that:
“The construct of development screens expanded economic chances and improved results in domestic and/or export markets, employment, criterion of life, and ( by deduction ) societal conditions normally included under the construct of quality of wellness attention, instruction, cultural chances and civic freedom and harmony”
In other words, the development construct is concerned with the activities taking to economic betterment and accordingly societal betterment. Though economic development is besides concerned with non-economic ends ( e.g. gender equity, democracy patterns, etc. ) , we will be more concerned in our research with the economic development in developing states.
The most used manner to specify developing Countries is by income per capita, where several international organisations ( e.g. World Bank, OECD, etc. ) offer categorizations of states by their economic position ( Todaro and Smith, 2008 ) . In this research, we will utilize the “List of Recipients of Official Development Assistance ( ODA ) ” developed by the organisation for economic co-operation and development ( OECD, 2008 ) , as it goes along with “BiD Network” standards. ( See Appendix B for the full list ) .
2.1.3 E-Business and economic development
“ The most recent of development schemes has been the attempts to speculate about the chances of ICTs as tools for economic development in hapless countries” ( Akpan, 2003 )
The usage of ICT and e-business applications has been promoted by many research workers and international development establishments as a supportive development tool assisting with bettering concern procedure efficiency, bring forthing new merchandises and services, and developing new concern chances and markets ( Chiware and Dick, 2008 ) , ( UNDP et al. , 2001 ) .
Sharing solutions and cognition among communities is one of the chief characteristics of ICT, where practical information can be provided in easier manner. Stienen et Al. ( 2007 ) reason how ICT can assist with heightening agricultural production by sharing cognition related to harvest position, eroding, plagues and other faced uncertainnesss.
Accascina ( 2002 ) expand this construct, reasoning how ICT can authorise rural communities, trough giving husbandmans the chance to be ever updated with market monetary values and to entree new markets in a direct manner, alternatively of being forced to accept the middle-man ‘s offer. Today, many illustrations are already established stand foring this attack.
In India for case, the private sectorled Agriwatch ( www.agriwatch.com ) , eChoupal programme ( www.itcportal.com/ruraldevp_philosophy/echoupal.htm ) , and others are back uping several million husbandmans with monetary value information, stamp and dealing installations. Besides in Senegal, Benin, Zambia and other developing states, rural communities and husbandman organisations are utilizing ICT to beef up their capacities and pricing negociating inputs and to maintain consciousness of up-to-date market information ( Stienen et al. , 2007 ) . E-business is besides supplying entree to assorted funding resources, willing to put in development and SMEs in developing states. MyC4 ( www.myc4.com ) , KIVA ( www.kiva.org ) , and others are web based market topographic points and micro-lending web sites, linking people willing to put worldwide with enterpriser in most of developing states.
Though it can non be denied that all those connexions and webs are supplying unprecedented flow of information and chances for developing states, literatures still lack empirical groundss stand foring the nexus between e-business and socio-economic development. ( Akpan, 2003 ) .
However, the relationship between ICT and economic growing is good documented ; there are really few surveies in the instance of developing states. The grounds of existent benefits is still scattered and anecdotal, though ecommerce does present existent chances to SMEs in developing states. ( Goldstein and O’Connor, 2000 ) , ( UNCTAD, 2008 )
2.1.4 E-Business and SMEs
The function SMEs are playing in developing economic systems has been ever considered as a nucleus of any economic development scheme, stand foring a chief manner to occupation creative activity and poorness decrease ( Chiware and Dick, 2008 ) , generated through comparatively little initial investings.
ICT and e-business publicity programs for developing states ever focus on the SMEs Sector. Payne ( 2002 ) suggests two grounds for this focal point on SMEs. First, SMEs is highly importance for developing economic systems, stand foring 60 to 70 per centum of all employment in developing states, as per the United Nations Conference on Trade and Development ( UNCTAD ) . Second, because of their comparatively little size and simple hierarchy, SMEs show higher flexibleness and ability to follow new engineerings than larger endeavors.
Different categorizations are commanding the grounds why SMEs follow ICT applications. In the 90s, Neergaard ( 1992 ) -in Fathian et Al. ( 2008 ) – argued that there are four chief grounds for the IT acquisition by SMEs, with a clear concentration on the operational side: Increased productiveness, streamlining work processs, better client service, and better record maintaining.
Ten old ages subsequently, and after the cyberspace concern booming, Payne ( 2002 ) was sum uping e-commerce potencies for SMEs in developing states in ( I ) happening new client ( two ) improving services for current and new client ( three ) bettering concern procedure efficiency and ( four ) offering new services and merchandises, with a concentration on marketing side and stand foring the power of e-commerce, which we will seek to measure in a ulterior subdivision through this survey.
2.1.5 Measuring E-business in developing states
Most of the bing researches about the usage of e-business, and its impact on concern public presentation in the underdeveloped universe, are based on anecdotal and instance survey grounds, whereas small statistical informations are available. We will seek here to reexamine some researches done over e-business acceptance in developing states, particularly in Asia and Africa, taking to pull out similarities and differences.
In a study based survey done by UNCTAD ( 2004 ) , for SMEs in 4 states in Asia ( Indonesia, the Philippines, Sri Lanka and Thailand ) , SMEs were divided into 3 types:
Internet users: advanced in countries such as production direction and capacity or English-language accomplishments. The proprietors of these companies have advanced grades or long-run experience
Prospective Internet users: working to better their direction criterions, but still have internal challenges such as recognition issues or obtaining short-run loans. But they were cognizant of the importance of making out to clients.
Traditional companies ( non-users ) : have a inactive attack to making concern in general with focal point on production, and non on market outreach. They are characterized by a deficiency of consciousness about the potency of e-business.
As stated before, like most of related researches, the UNCTAD survey had no statistical informations about each class, but we could understand from it that deficiency of consciousness and finance are the major challenges faced by SMEs in the surveyed states to follow e-business. Though finance may sound as the most debatable issue, the survey reveals that it is non true. In the surveyed states, if SMEs experience a positive impact on their concern, they will put in hardware and connectivity. In other words, the preparedness of SMEs to put in e-business is non needfully a cost factor.
Though those similarities are noted in South East Asia, another Asian-Middle
Eastern state “Iran” shows other features. In another Study, Fathian et Al ( 2008 ) use a statistical attack based on factor analysis to measure the e-readiness of SMEs. The survey raises another job concluding that the assessed SMEs do non hold many jobs with being ready to utilize the cyberspace for concern, but need much greater infrastructural support in order to harvest ICT benefits.
Traveling to Africa, more differences can be found, particularly related to barriers found in each state. On manus there is Ethiopia, where the authorities ‘s monopoly has affected the possibilities to better the substructure by any private enterprises, while on the other manus Senegal, where the concern proprietors ‘ deficiency of consciousness about cyberspace concern benefits hold them from puting in e-business, particularly that “profitability” or commercial utility and immediate returns for the investing in ICT are non clear.
In Egypt, a clear relationship was found between companies ‘ size and their e-readiness. Though about 100 % of SMEs are connected to the cyberspace, most of their proprietors lack the consciousness of cyberspace concern benefits. Though Internet is used normally for communicating with external clients and providers via electronic mail, it is non used for research or selling ( UNCTAD, 2004 )
In another survey concerned with Namibian SMEs, Chiware and Dick ( 2008 ) ran one of the few studies measuring both SMEs and SMEs Centres at the same clip, uncovering that though SMEs have really low degree of ICT use, due to the substructure jobs and deficiency of consciousness, SMEs Centres ( who are usually supported by the authorities or international establishments ) have comparatively high degree of ICT acceptance, which seems to be unutilized due to supported SMEs ‘ low connectivity to the cyberspace, and to their deficiency of consciousness of Internet concern benefits.
Checking the whole image in Asia and Africa, it can be argued that though big figure of SMEs is connected to the cyberspace, the acceptance of e-business is quiet low, where the chief usage of cyberspace is e-mailing and information hunt, but website presence and online ordering/selling are turning much more easy, due to miss of good connectivity in some states, and deficiency of consciousness in most of surveyed states. On the other manus, though the connectivity and ICT substructure degree besides vary through different states, different surveies agree that authoritiess should concentrate on the ordinances and legal side of e-business, where about no legal context exists so far ( UNCTAD, 2004 )
At the terminal, it can be argued that despite the progressively apparent advantages of e-business for concern, the acceptance by developing state endeavors for e-business is still limited, where deficiency of consciousness and investing costs are the chief restraints for following e-business and other ICT application. ( UNCTAD, 2008 )
The term E-readiness can mention to SMEs e-readiness, represented in its preparedness to utilize ICT, and Country e-readiness, represented in its substructure and ordinances leting utilizing ICT. In this survey, the term will be used to stand for the state e-readiness.
As the presented survey will measure factors impacting SMEs attitude towards e-readiness, state e-readiness is an of import factor that should be considered.
There are different positions and definitions for states e-readiness. The Economist Intelligence Unit defines e-readiness in its last study for 2009 as:
“a step of the quality of state ‘s ICT substructure and the ability of its consumers, Businesss and authoritiess to utilize ICT to their benefits” ( EIU, 2009 )
Another position of e-readiness defines it as the grade to which a community is prepared to take part in the Networked World, which is gauged by measuring a community ‘s comparative promotion in the countries that are most critical for ICT acceptance and ICT of import applications ( CID, 2006 ) Though many other definitions are besides proposed for the term, they all portion the same construct, of measuring states ‘ or communities ‘ preparedness for ICT and e-business.
In this survey we will utilize the definitions proposed by the Economist Intelligence Unit ( EIU ) . Though most of definitions have the same construct, different methodological analysiss are used to measure the states e-readiness. EIU is measuring states e-readiness based on a combination of standards including: connectivity and engineering substructure, Business, societal, cultural and legal environment, authorities policy and division, and Consumer and concern adaptation ( EIU, 2009 ) . Other establishments are measuring e-readiness as indices based on simple measurings, like figure of telephone lines per 100 people or the GDP per centum spent on IT substructure ( Dada, 2006 )
2.2.1 E-Readiness and economic development
As an index of states ‘ preparedness to follow e-business, e-readiness rankings show close connexion to development activities and authoritiess ‘ willingness to better their development advancement.
In the visible radiation of the discussed ICT function with development, Chiware and Dick ( 2008 ) argue that it is rather obvious how e-business -as a sector with important potential- became a focal point in many states, forcing authoritiess to be more active with advancing their e-readiness in assorted sectors.
Shih et Al. ( 2007 ) argue that states tend to develop and advance “ereadiness” taking to speed up their economic growing, where higher degrees of ereadiness addition the fight of national economic systems and endeavors, which leads to occupations creative activity, local communities ‘ authorization, and poorness decrease ( Dada, 2006 )
At the same clip, authoritiess can straight promote e-commerce in their economic systems, peculiarly among SMEs. In India, for illustration, the authorities is be aftering to establish an electronic auction for fruits, where husbandmans with little sized concern can put monetary values for their harvests and sell them even before its physical transit. Besides in Tunisia the authorities has an aim, that ecommerce bring forth 2 per cent of all exports grosss by 2011 ( UNCTAD, 2008 )
Though the importance of states ‘ e-readiness in back uping SMEs acceptance of e-business, many literatures criticise the relation between them and reason that holding an e-ready state does n’t intend holding e-ready companies. This point of position, in add-on to e-readiness appraisal methodological analysiss, can be considered as the chief restrictions discussed in the reviewed literature knocking e-readiness construct dependability. In other word, restrictions of E-readiness can be divided in two classs: critics on e-readiness appraisal models and critics on the thought that higher e-readiness must take to higher e-business acceptance, which we will seek to clear up here.
Several E-readiness appraisal models have been proposed by several NGOs and international organisations to assist measuring states ‘ e-readiness utilizing a theoretical penetration from developmental and institutional economic systems. In a recent survey, Boyer-wright and Kottemann ( 2009 ) argue that there is deficiency of adequate empirical groundss on the relation between models used for measuring e-readiness and the existent degree of e-business, which may take to e-readiness rankings that do non reflect the world. Besides many different types of e-readiness measurings are being used, with deficiency of standardisation, and are fraught of uncertainness ( Dada, 2006 )
A study prepared for InfoDev -a planetary development financing plan, with involvement in utilizing ICT for development- , references that e-readiness rankings and studies province facts and recommendations ( e.g. demand of ordinances and better ICT substructure ) that anyone working in ICT and development in the assessed developing state knows, and that e-readiness rankings need to go more focussed and action-oriented to stay utile as a tool ( Bridges.org, 2005 ) . On the other manus, Pare ( 2002 ) argue that set uping e-readiness environment can non vouch higher e-business acceptance or meeting development ends, particularly when SMEs and enterprisers are non e-ready to utilize e-business. A sample for this is the instance of Hong Kong, where environmental and labour organisations could non follow the information engineering in a successful manner, in malice of Hong Kong high e-readiness. In other words “The fact that a society rates extremely in e-readiness does non automatically intend that organisations within that society will follow ICTs to derive advantage” ( Dada, 2006 ) .
With the raised restrictions, the writer is non seeking to province that the applications of e-readiness are useless, but to see e-readiness as a factor impacting SMEs ‘ acceptance of e-business, and to measure if state e-readiness is sufficient entirely as an index of the ability of developing states and their SMEs to follow e-business, which we will seek to make through the presented survey.
2.2.2 E-Readiness in Developing states
The deficiency of strong IT substructure or set of accomplishments is a known issue by many developing states, consequently when e-readiness studies reference this ; they are merely saying the obvious ( Dada, 2006 )
A study from ( UNCTAD, 2004 ) , showed that though the increasing Numberss of SMEs utilizing the cyberspace and keeping web presence ( in Thailand, Ghana, South Africa, Morocco, Nigeria, Senegal and Uganda ) , a really low per centum of e-business acceptance has been noticed. Chiware and Dick ( 2008 ) argue that this can be justified by the challenges faced by developing states in footings of substructure, economical, societal and cultural environment, which indicate hapless province of e-readiness, comparing to developed states.
Aiming to research the e-readiness of developing states, the Economist Intelligence Unit e-readiness rankings, which is the most normally used in the media, have been reviewed for the old ages 2005 boulder clay 2009. The one-year study of EIU includes merely the first 70 graded states worldwide. The staying states are merely ungraded or have no e-readiness index. ( See Appendix C for EIU e-readiness ranking 2009 )
It can be argued that despite developing states ‘ attempts, parts of Africa and Latin America “containing most of developing countries” were ever the least developed on e-readiness rankings comparing to the other parts over the last five old ages. For case, 01 illustrates the e-readiness ranking for 2008 per part.
Through the last five old ages the per centum of graded developing states from the DAC list of ODA receiver ( Appendix B ) was ever between 35 % ( in the twelvemonth 2005 ) and 40 % ( in the twelvemonth 2009 ) , and the highest rank of any underdeveloped state from DAC list was ever between the 35th ( In the twelvemonth 2007 ) to the thirtieth ( In the twelvemonth 2007 ) .
Taking into consideration that DAC list includes about 150 states, stand foring more than 75 % of states registered by the UN, the per centum of developing states ranked in EIU e-readiness rankings can be a good index to the digital divide phenomenon, stand foring the spread between developed and developing states in utilizing information engineering applications ( Mansell, 2002 )
Though the indicated spread between developed and developing states, evidently attempts are being paid to contract it. The most updated ranking, EIU ( 2009 ) indicates that emerging markets continue to single-foot up the biggest progresss in being connected to communications webs. This goes along with other incidents bespeaking that developing states are shuting the cyberspace spread with developed states, though they are shuting it easy ( UNCTAD, 2008 )
Research Design and Methodology
This chapter identifies the methodological analysiss used in this research. Section 3.2 will cover the research design and methodological analysis including research scenes, survey sample, questionnaire and the response rate. Section 3.3 will sketch the construction of telephone interviews conducted with respondents with complete responses on the questionnaire.
3.2 Research Design and Methodology
The purpose of this explorative research is to measure the current degree of offering web based services by SMEs Centres in developing states, the SMEs ‘ willingness to utilize them and the factors impacting this use. Due to the initial range of measuring 10 states, the usage of instance surveies as a information aggregation methodological analysis -though it can supply deeper information- sounded as an unrealistic pick. Noting the undertaking clip restraints, taking the instance of each of the 10 states was to necessitate more resources and clip beyond the range of this undertaking. Alternatively, a determination was made to utilize questionnaire methodological analysis to roll up the needful primary informations.
The questionnaire was helpful with placing the chief concern features of SMEs and SMEs Centres in the surveyed states, in add-on to their IT profiles, services required by SMEs and services offered by SMEs Centres. Beside the questionnaire, and to acquire more in depth information about the factors impacting SMEs and SMEs Centres attitude towards utilizing web based services, depth non-standardised telephone interviews have been conducted with the respondents with complete responses on the questionnaire
A assorted research methodological analysis has been followed to guarantee holding a complete image about the surveyed subject. The information generated through both methodological analysiss have been analyzed qualitatively. Consequently the research doctrine can be defined as Multiple method qualitative survey ( Saunders et al. , 2007 )
3.2.2 Research Settings and Study Sample
Measuring the on-line behavior of SMEs and SMEs Centres in all developing states requires a batch of resources and clip beyond the range of this undertaking.
The research range has been identified by measuring SMEs Centres, with proper Internet presence, in 10 developing states. By proper cyberspace presence, we mean holding at least an established web site. At the same clip, SMEs Centres are used in this survey as a beginning of valuable information about SMEs and their on-line penchants.
Taking into consideration that 152 developing states exist in our current universe ( Listed in DAC list ) , the procedure of placing representative states with involvement towards e-business, and SMEs Centres within those states with involvement towards web engineering, required utilizing a mix of purposive and multi phase trying techniques, to place a proper sample for this undertaking.
From the research beginning, the undermentioned states have been excluded, based on the researched company “ BiD Network ” petition:
• BRICs states ( Brazil, Russia, India and China ) and South Africa: those states are already mature with online services, and BiD Network is non interested in aiming them for the clip being.
• East European States: they are non stand foring an pressing mark market for BiD Network.
• Latin American states: BiD Network has already a batch of contacts and established informations beginnings in Latin America.
Consequently the research concentration was on Africa, Middle East and Asia.
As requested by the researched company, a particular ranking for SMEs and enterprisers concern ‘ chances, prepared by BiD Network itself, has been used to place the sample frame including 33 states. The 33 states ( See Appendix D ) have been identified as the most 33 promising developing states on “BiD Network” ranking, which is an norm of 3 international rankings:
1. Ease of Making Business: based on “Doing Business” 2009 Report ( World Bank, 2008a )
2. Access to Finance: based on World Bank paper “Access and Use of Financial Services” 2006, and “Doing Business” 2009 Report ( World Bank, 2008a )
3. Entrepreneurship ranking: based on World Bank Entrepreneurship Survey 2008 ( World Bank, 2008b ) , and GEM Report 2008 ( Global Entrepreneurship Monitor, 2008 )
Though BiD Network ranking is non taking e-business acceptance into consideration, the writer has no job with utilizing it, particularly after comparing the identified 33 states with the EIU e-readiness ranking for 2009 ( EIU, 2009 ) , and guaranting that all developing states from Africa, Middle East and Asia listed in EIU e-readiness ranking for 2009 ( 16 states harmonizing to the mentioned choice standards ) are included in the sample frame ( See Appendix D for the 33 states and Appendix C for EIU E-readiness ranking ) .
Though all discussed restrictions of e-readiness rankings, it was used as a mention because it is the lone available ranking relevant to this undertaking. Unfortunately, we still lack any other rankings for developing states based on their acceptance and usage of e-business or web based services.
As legion Numberss of SMEs Centres are active in the specified 33 developing states, a primary online research was required to place SMEs Centres with proper web presence ( at least holding a web site ) and established members of SMEs, where relevant information to this undertaking can be acquired. A penchant has been raised by BiD Network to avoid governmental establishments and concentrate on private sector organisations, which are normally more flexible and advanced. By the terminal of the on-line research, 72 SMEs Centres with proper online presence have been identified in 31 states.
As no contact was antecedently established with the identified SMEs Centres, a stage of pre-survey contact was needed ( Saunders et al. , 2007 ) . Preliminary phone calls were made with the identified 72 Centres to advance the study and place the proper contacts in each Centre. This stage raised some restrictions of the research, represented in:
– Incorrect contact information on many Centres ‘ web sites
– Lack of proper contact individual with equal English linguistic communication
– Absence of proper contact individual because of one-year leave
By the terminal of this stage merely 34 SMEs Centres covering 21 states have been identified as appropriate to direct the questionnaire to ( See Appendix D ) . It should be noted that merely 19 out of the 34 contacts were contacted straight by phone before directing the questionnaire. The staying 15 contacts were non approachable, but have been identified through web sites and indirect contacts within the SMEs Centres.
This mix of purposive and multi phase trying techniques normally have some advantages and disadvantages. While utilizing the purposive sampling helps with holding enlightening sample, the sample can non be considered to be statistically representative of the whole population ( Saunders et al. , 2007 ) . On the other manus, though the advantages of multi phase sampling, represented in lower cost and comparatively easy available information, the hazard of holding homogenous sample with similar attitude exists ( Saunders et al. , 2007 ) . However, the writer does non believe that this will impact the sample profoundly, as this survey is taking at placing qualitative grounds and the multi phase technique led at the terminal to a broad distributed sample.
3.2.3 The questionnaire
After reexamining available literature, specific spreads have been identified related to the undertaking. Though many researches have discussed the barriers and deductions of utilizing e-business by SMEs, and the governmental enterprises / undertakings to advance e-business in developing states, limited researches have been found covering the undermentioned points:
– Actual offered web based services by SMEs Centres in developing states
– Actual required services by SMEs in developing states
– How can net based information engineering aid with supplying those needed services.
– Which factors are impacting the use of web based services by SMEs in developing states.
A spread was besides identified related to SMEs Centres ‘ function with germinating e-business in developing states, challenges they are confronting with this function, and the viability of constructing a concern theoretical account based on supplying web based services to SMEs in developing states.
All those spreads have been incorporated into the questionnaire, which has been divided into 4 subdivisions, covering:
– SMEs Centres ‘ Demographics, concern and IT Profiles
– SMEs ‘ Demographics, concern and IT Profiles
– Offered and required Servicess ( web-based / Non web-based )
– Each service web being or possibility to be used on the web
Different inquiries have been besides added aiming the factors impacting use of web based services by SMEs.
The questionnaire has been reviewed with practicians who have experience in the field and besides with the academic supervisor. After a figure of loops and alterations, the questionnaire was sent to the receivers. A pilot testing was attended to be conducted, but it has been cancelled due the undertaking clip restraints. A transcript of the sent questionnaire is presented in ( Appendix G ) .
The questionnaire has been conducted as web based questionnaire, offering synergistic scenarios based on the respondents replies. In mean 10 pages with 40 inquiries had to be answered to finish the study. However, the study has been designed to take no more than 15 to 20 proceedingss to be completed.
Though the questionnaire is rather elaborate, it was developed to reply 4 simple inquiries:
1. What is the IT profile of SMEs and SMEs Centres?
2. Which factors are impacting SMEs and SMEs Centres acceptance of ebusiness?
3. Are SMEs Centres in the surveyed states interested in BiD Networ proposed online services?
4. Which other services are required by SMEs and SMEs Centres in the surveyed states?
The length of the questionnaire was a necessity due to the different targeted information, and the limited available information about factors impacting utilizing web based concern services by SMEs. This is why, as an illustration, many inquiries have been added to place concern sectors, gross revenues ‘ graduated tables, organisations types, and other information, taking to happen a form that describe those factors.
It should be noted, that few inquiries have been duplicated through the questionnaire, taking to acquire some in depth information and to uncover confusion by some SMEs Centres sing their services. Some beliing replies have been identified and discussed through the telephone interviews. Most of beliing replies were related to the non standardisation of IT nomenclature within the industry.
3.2.4 Response rate
As antecedently discussed, the raised restrictions with placing the sample frame had besides affected the response rate.
There are different methodological analysiss in ciphering response rates. While Neumann ( 2000 ) suggests ciphering entire response rate with excepting ineligible respondents, Saunders et Al. ( 2007 ) proposes ciphering the active response rate, where both ineligible and unapproachable are excluded. Due to difficulty that we may confront with placing the ineligible and unapproachable parties during this survey -In fact, many of them have been excluded through the multi phase sampling- , we would prefer here utilizing a simple response rate calculated as figure of responses to entire figure of contacted sample SMEs Centres ) .
By the terminal of August 2009, 14 responses were collected ( stand foring 41 % of sent petitions ) including merely 11 complete responses ( stand foring 32 % of the sent petitions ) . However, there is no certain of acceptable response rate, 32 % can be considered as acceptable rate for this pilot undertaking, taking into consideration the length of the questionnaire and its timing.
Though the limited figure of complete responses, the gathered responses presented 10 states ( Which was the primary mark ) , with high assortment and different features. Most significantly, the respondents presented a distributed sample for states from Asia, Africa Sub-Sahara, North Africa and the Middle East ( which were the targeted parts as discussed above ) . Besides, different organisations ‘ sizes and types have been represented through the reacting SMEs Centres. The chief SMEs Centres ‘ features are summarized in the presented survey under ( Appendix E ) .
3.2.5 Survey cogency
With all stated positive facets of studies, there is ever a possibility to hold some booby traps within any survey ; the following were faced through the study: Obscure / Bad Questions: The writer tried to avoid holding bad inquiries by working in coordination with both: academic supervisor and concern co-worker within BiD Network. In add-on to guaranting the cogency of inquiries, a particular attending was given to do the inquiries understood by the respondents in the same manner meant by the writer ( Foddy, 1994 ) .
Language / Cultural Barriers:
However the study sample frame included 33 states with a mix of different linguistic communications, a determination was made to put the questionnaire in English linguistic communication and carry on the telephone interviews with one of the linguistic communication the Author can talk “ English, Arabic, German and small Gallic ” .
Though it is good known that English is normally used for concern, this is non ever the instance for developing states. For illustration, West and North African states prefer to utilize and larn Gallic as a foreign linguistic communication. BiD Network used to confront the same job in its studies for Latin America, and the solution was ever to plan studies in both linguistic communications, English and Spanish. This option was non valid for this undertaking due to its clip restraints and different covered parts.
The writer tried to cut down the expected misinterpretation jobs by give voicing the inquiries in simple and direct English linguistic communication. At the same clip, the pre-survey contact was a helpful technique to place the right contact with proper linguistic communication degree and insight information.
Through telephone interviews conducted after finishing the questionnaire, the writer has ensured that all inquiries were understood right and answered decently.
3.3 Telephone Interviews
To clear up some of the points made on the questionnaires, telephone deepness interviews were conducted with several respondents to guarantee that a full apprehension of their sentiments and positions was achieved. The interviews were conducted in English and Arabic ( based on the respondents ‘ penchant ) , and took on mean 40 min per interview.
Though certain inquiries have been pre-prepared for each participant, based on the questionnaire replies, the inquiries were planned to take 20 % of the interview timing, go forthing 80 % to the participant to speak freely about his/her apprehension about the subject, and giving the interviewer the opportunity to suggest more in-depth inquiries based on the participant responses.
Though the declared restrictions of telephone interviews, including participant less willing to prosecute in explorative treatment and losing the chance to witness the participant non-verbal behavior ( Saunders et al. , 2007 ) , it was the optimal available technique, due to the sample broad geographical distribution. However, the writer faced some extra jobs, particularly with different speech patterns and apprehension of the linguistic communication, the interviews were rather helpful in clear uping and giving more in-depth to the information gathered by the questionnaire. A sum-up of the interviews is presented in ( Appendix F ) .
Chapter 4 has outlined the methodological analysis used in this research. A multiple method qualitative survey has been adopted as chief methodological analysis, while a mix of purposive and multi phase trying techniques have been used to place the research sample. Responses to the questionnaire represented SMEs Centres in 10 different states with different features. Follow up telephone interviews were conducted with respondents to the questionnaire to acquire a more elaborate image about the surveyed subject.
4 Consequences Analysis
This chapter will concentrate on presenting and analysing the completed responses on the questionnaire and the follow up in-depth telephone interviews.Qualitative analysis techniques were used in this case to construe the findings.
As stated by Saunders et Al. ( 2007 ) , there is no standardised attack to the analysis of qualitative informations. Inductively-based analytical processs have been used including informations show and analysis ( Miles and Huberman, 1994 ) , where collected information has been reduced and summarized, before piecing them into diagrammatic shows.
Besides template analysis with preset classs have been used, in add-on to some discourse analysis attacks ( Saunders et al. , 2007 ) . The different techniques helped with uncovering a clearer image of the surveyed issues, and placing the dealingss between different informations classs. Where no reading was needed for direct demographic inquiries, more elaborate and in depth analysis was given to the unfastened ended inquiries to understand the responses and happen an inter-connection between different sentiments presented in responses to other inquiries.
The analysis will concentrate on replying the chief research inquiry, researching the current position and chances of utilizing web based information engineering by SMEs and SMEs Centres in the surveyed states. Consequently the findings has concentrated on 4 facets: ( I ) current IT profile of SMEs and SMEs Centres, ( two ) factors impacting SMEs usage of web based information engineering, ( three ) services being offered to SMEs with its current IT profile, and ( four ) hereafter possibilities of utilizing web based information engineering ( Particularly, the proposed undertaking by BiD Network ) .
4.2 Key findings
4.2.1 SMEs ‘ and SMEs Centres ‘ IT profiles
In order to understand the e-business chances within developing states, appraisal of SMEs and SMEs Centres attitude towards basic acceptance of
Information engineering is indispensable.
The questionnaire included multiple inquiries measuring the IT profile of both
SMEs and SMEs Centres, where the respondents were asked to rate their organisations ‘ and their members ‘ IT Profile runing from none to sophisticated:
Question 9, Page 3:
Question 6, Page 4:
Due to the purposive sampling technique, where merely SMEs Centres with proper on-line presence were selected, all surveyed SMEs Centres had at least basic IT profile.
Looking at the IT profiles of responded SMEs Centres and the IT profiles of their
SMEs members, it can be argued that on a planetary base, a clear spread has been identified between SMEs ‘ and SMEs Centres ‘ IT profiles in developing states.
While sensible investings have been dedicated to follow sophisticated IT systems by SMEs Centres, it seems that this is non the same state of affairs for their SMEs members. 03 ( IT Profiles of SMEs Centres ) and 04 ( IT Profiles of SMEs ) represent the difference between both profiles, where most of SMEs Centres get externally advanced and sophisticated IT systems, but the bulk of their members is utilizing basic or no IT applications at all.
At the same clip, looking at each state entirely and analysing SMEs Centres as instance by instance, we can see that the spread besides exist between each SMEs Centre IT profile and its ain SMEs members IT profiles.
In their survey about ICT acceptance by Namibian SMEs, Chiware and Dick ( 2008 ) indicate the same phenomenon, reasoning that though most of SMEs are still loath in utilizing the cyberspace as an efficient concern tool, Business support Centres ( e.g. SMEs Centres ) have more developed IT profile and willingness to follow e-business, which can be translated -in relation with BiD Network proposed project- into a concern chance, where SMEs Centres can be considered, non merely as cyberspace services supplier, but more significantly as an Infomediary with concern information exchange platform. Unfortunately, this chance does non look to be in most assessed states, particularly where SMEs have no long term vision or involvement in perforating new markets. As an reply on the telephone interview inquiry about the SMEs Centres ‘ attempts to better their SMEs members ‘ inclination towards utilizing cyberspace for concern, the manager of responded Indonesian SMEs Centre stated that:
“ Though the concern theoretical account of SMEs in Indonesia does necessitate holding dependable e-business system, to assist them aim international clients alternatively of waiting for them to come, SMEs in Indonesia still do non recognize this fact. The Centre is set uping preparations to advance the consciousness of ebusiness and cyberspace, but the ratio of altering SMEs ‘ outlooks towards utilizing cyberspace for concern is 1 to 50! SMEs are non interested in personal preparation, in concern modeling or in long term ends and scheme ; they are more interested in gross revenues ” .
The identified job here is non merely that SMEs do non understand the benefits of cyberspace concern. But besides that they are merely concerned with short term ends ( e.g. gross revenues ) , and are non demoing any involvement in activities with long term aims, like developing on making concern on the cyberspace. This fact deprives SMEs Centres at the terminal from the concern chance they may hold through their advanced IT profile.
4.2.2 Factors impacting e-business acceptance by SMEs
The factors impacting SMEs ‘ usage of web based information engineering was besides explored through different inquiries in the questionnaire:
220.127.116.11 IT qualified staff and sufficient proficient support
Though fiscal restraints are normally considered as the most major faced challenge sing the execution of web based information engineering, the respondents raised both IT qualified staff and sufficient proficient support as equal hard challenges to implement web based information engineering by SMEs. 06 summarizes the major challenges faced by SMEs sing the execution of web based information engineering, from SMEs Centres ‘ point of position.
It should be noted that this is non absolute informations, but comparative to measure qualitatively the sentiments and positions sing the different factors. Within our qualitative analysis, we are non chiefly concerned with the mean rate each factor scored, but with the stated response that the fiscal factor is non the merely or the first factor impacting the execution of Web based Information engineering. This could give an indicant about how mature the thought about e-business is germinating, and its existent barriers can be revealed.
From the writer ‘s observations and experience with the IT sector in developing states in the Middle East, qualified IT and proficient support resources are available, particularly for the web based engineerings. However, it seems that the job is non related to the handiness of IT qualified staff, but to the fact that the SMEs are non interested in engaging them. The general director of Egyptian SMEs Centre, stated through our telephone interview that:
“ IT Staff is the most major challenge, non because of missing good resources, but because it is non a precedence for our SMEs members to engage qualified IT staff. The members concentrate on utilizing the cyberspace for e-mail communications, which is a map that any employee can make ” .
In Indonesia, the same challenge exists but from another position. The general director of the responded Indonesian SMEs Centre argues that in add-on to the Indonesian SMEs reluctance to engage IT qualified staff, there is a comparatively rarity of IT qualified resources in Indonesia. This state of affairs led to many jobs particularly that SMEs are outsourcing all their IT needs to unreliable IT resources, which is impacting SMEs cost and operations badly at the terminal.
18.104.22.168 Knowledge of cyberspace concern benefits
The insufficient cognition about information engineering and cyberspace concern benefits has been ever raised in several researches as a major challenge for implementing web based Information Technology. As stated above “Question 8, Page 4 ” , the respondents were asked to province freely the 3 major factors that should be addressed to enable SMEs to implement web based IT, with ranking them where the first is the most of import one.
5 out of the 11 complete responses stated cognition about IT and internet concern engineering as the first factor that should be addressed to advance ebusiness among SMEs.
Again, the per centum is non really of import in our qualitative analysis, but the first issue respondents are believing about it as a factor that should be addressed as rather of import, and defines the policy most SMEs Centres are following to advance e-business to SMEs, which is the proviso of preparation, non publicity of e-business applications ( e.g. BiD Network proposed undertaking ) .
In a telephone interview with the IT executive manager of a respondent SMEs Centre from Egypt, a inquiry was asked about the possibility to finance a web based undertaking “ e.g. BiD Network proposed undertaking ” , utilizing governmental enterprises or international fund. The reply was that in instance of acquiring such a fund, it will be easier to utilize it for preparation, in malice of the troubles SMEs Centres are confronting with geting people for IT preparations.
This complies with the fact that the most provided service by SMEs Centres to SMEs is the preparation service. More inside informations about services will be discussed under subdivision 4.2.3.
22.214.171.124 Customers and Trading Partners
The function of clients and merchandising spouses ‘ in pressing SMEs acceptance of ebusiness is quiet obvious. The more present or possible clients and trading spouses are mature with e-business and distributed in different locations ( particularly out side of the SME state ) , the more SMEs should be interested in utilizing web based Information to guarantee accessing new markets and planetary concern chances.
After reexamining the conducted telephone interviews, it seems that this statement can non be used as a regulation particularly with the raised issue of holding “ The chance ” to entree the international market, and holding “ The enterprise ” to entree it, as explained afterlife. The study has revealed some beliing state of affairss. While analysing the response from Indonesia, where 50 % of supported SMEs are from the fabrication sector, it was clear from the questionnaire replies that clients and trading spouses are strongly back uping the impression of utilizing ebusiness by SMEs, particularly -as indicated by the SMEs Centre general manager- that their SMEs ‘ fabrication merchandises have international demand. The job in this instance -as indicated by the same respondent in subdivision 4.2.1- was the deficiency of “ The Initiative ” to take a measure towards aiming international clients alternatively of waiting for them, due to the deficiency of long term scheme and non understanding the cyberspace benefits for concern. On the other manus, the instance in Jordan is about the antonym. Where 55 % of supported SMEs are working with engineering services and demo good apprehension of cyberspace concern benefits, it seems that clients are non back uping the impression of utilizing e-business. The ground -as revealed in the telephone interview with the executive manager of Jordanian SMEs Centre- is merely that most of clients are located in Jordan, and SMEs still do non hold “ The Opportunity ” to make an international demand on their services. Both state of affairss have been reflected in each SMEs Centre ‘s reply on the inquiry about major factors that should be addressed, to enable SMEs implementing web based information engineering ( Question 8, Page 4 ) . While the SMEs Centre in Indonesia indicated “ Research on Internet concern benefits ” as the first factor to be addressed, the Jordanian SMEs Centre stated the first factor as “ Cross Continental selling ” .
126.96.36.199 Culture and Language
In add-on to the fact that e-business is normally restricted by issues of trust on the demand side, particularly where money minutess are required ( UNCTAD, 2008 ) , some civilizations do prefer holding physical contact while pass oning. As stated by the Jordanian SMEs Centre executive manager during our telephone interview:
“Though clients -mainly in Jordan- are cognizant of cyberspace engineering and its benefits, they do non be given to utilize cyberspace a batch for concern, merely because of the direct meeting and face to confront civilization, preferred in the in-between east” . On the other manus, linguistic communication is a critical issue that should be taken into consideration with any planetary study/project, particularly when covering with developing states. In add-on to the limited cognition of linguistic communication because of undeveloped instruction systems in most of developing states, it should be noted that the “Business Language ” itself varies between developing states. Where Asia and Middle East states usually use English as foreign concern linguistic communication, we find that West and North Africa prefer to utilize Gallic as foreign concern linguistic communication, while Latin America is utilizing Spanish.
This fact creates a linguistic communication barrier for most states with other concern linguistic communications than English, and makes them unable to entree most of online concern chances, normally written in English. Consequently, any planetary web based service -e.g. the proposed undertaking by Bid Network- should be promoted in more than one concern linguistic communication.
188.8.131.52 Fiscal restraints
Fiscal constrains are the most good known factor impacting e-business acceptance. In add-on to detecting that fiscal is non the lone major factor that needs to be addressed to enable SMEs implementing web based IT, fiscal restraints have got different types in the questionnaire replies. While it takes the form of fixed costs related to IT equipments in Egypt, entree to early phase hazard capital in Jordan ( Where both states are ranked within EIU 2009 ereadiness study ) , SME Centre in Botswana finds that the cost of internet connexion and IT staff are the major fiscal challenges.
184.108.40.206 Country E-readiness
Though the argued restrictions of e-readiness rankings, that they do non truly assess e-business acceptance per state, it can non be denied that the state ereadiness ( In the signifier of substructure, dependable connectivity, etc… ) affect SMEs IT profiles and e-business acceptance.
The gathered responses showed differences between SMEs ‘ IT profiles in states with e-readiness index and their opposite numbers in states without ereadiness index.
Information engineering diffusion and assortment of IT profiles in states with e-readiness index is higher than they are in states without e-readiness index.
The contention of this research is that the e-readiness index can non be used as a regulation to measure SMEs acceptance of IT or e-business, taking into consideration the different factors impacting SMEs IT and e-business acceptance. Though the last 2 s showed that e-readiness can be an index for IT diffusion, another raised instance from the study indicated that other factors may impact IT diffusion and expose e-readiness dependability for this respect.
Two SMEs Centres have responded to the questionnaire from Egypt ( Which was the lone state 2 responses have been received from ) . 9 illustrates the SMEs ‘ IT profiles in both SMEs Centres.
Though both SMEs Centres are active in the same state, their SMEs IT profiles are wholly regardful, merely because each one of them is back uping different concern sector and different concern sizes. While SMEs Centre ( A ) is back uping 61000 SMEs, who are working in retail concern with little size ( less than 10000 USD gross revenues per twelvemonth ) , SMEs Centre ( B ) supports agricultural concern with high-medium size ( 50000 to 1000000 USD gross revenues per twelvemonth ) . This raises the importance of measuring other factors while utilizing e-readiness rankings, and supports the statement that though the importance of states e-readiness in advancing e-business, other factors should be taken into consideration while measuring the e-business acceptance among SMEs. A subdivision was planned to analyse the relation between e-business acceptance, concern sector, and concern size. Unfortunately the collected information was non detailed plenty to place a form commanding the relation between the 3 subjects. Most of responded SMEs Centres did non supply elaborate information about the exact sector, gross revenues volumes or budgets related to their SMEs members, out of confidentiality. This issue will be mentioned as a restriction in the decision subdivision.
4.2.3 Services and net based Servicess
In our geographic expedition of the current services offered by SMEs Centres and services required by SMEs themselves, we are seeking to place the being and possibilities of web based services within developing States.
220.127.116.11 Web based services offered by SMEs Centres
A whole subdivision in the questionnaire was dedicated to place current offered services by SMEs Centres. The subdivision started with the undermentioned inquiry:
Question 1, Page 5:
The reply picks included the most known services offered by SMEs
Centres, in add-on to 2 web based services. 10 illustrates respondents ‘ replies.
As illustrated, and in concurrence with the statement in subdivision 18.104.22.168, Training is the most offered service by most SMEs Centres, while the following most offered services are Reding / Business Consulting and one to one coaching, which are besides related to preparation, though they are usually more concerned with specified instances.
Mentioning to the web based services ; merely one SMEs Centre from the respondents is offering on-line coaching, in Jordan. The undermentioned “later” inquiry was inquiring about holding on-line community:
Question 6, Page 5:
Though three SMEs Centres indicated in their replies on this ulterior inquiry ( Question 6, Page 5 ) , that they do run online community, no SMEs Centres stated in the first inquiry ( Question 1, Page 5 ) that they offer on-line community as a service. The grounds for this are ( I ) the unknowingness of on-line community as an offered service to SMEs ( two ) that SMEs Centres are utilizing on-line communities as a communicating tool with their member, instead than an on-line platform where SMEs can reach each other and have entree to international investors and merchandising spouses.
Consequently, it can be argued that about all surveyed SMEs Centres are non offering any online