Internet-Based ICT Usage By South African SMEs: The Barriers Faced By SMEs

Abstract

Previous research estimates that 8 out of 10 small and medium enterprises (SMEs) do not operate for more three years (Mason 2015). According to OECD ([sa]), the major problems encountered by SMEs relate to financing and regulatory burdens. However, with information technology, SMEs are able to narrow the information gap, which leads to improved strategies and decision making (OECD [sa]). In today’s competitive world, information communication technology (ICT) is recognized as a crucial success factor for SMEs. ICT refers to the accessing and communication of information using various technologies such as the internet, wireless networks and cellphones (TechTerms 2010). This research study investigates SMEs’ perception of the barriers in adopting ICT in the South African context. The objective of this paper is to determine ICT adoption and the perceived barriers associated with it among South African SMEs. A review of ICT within an SME context is examined. Through judgement sampling, a questionnaire was distributed to gather the responses of 90 SMEs. The most important barriers that were highlighted by the results of the study are the high cost of ICT systems as well as the lack of knowledge to maintain and use ICT. The challenge is to ensure that South African SMEs continue to increase the adoption of ICT. It is envisaged that by determining the barriers they face and providing recommendations as to how they can overcome these barriers, this research will assist SMEs to become more successful, as they play a vital role in the South African economy.