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Research Detail

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Md. Rakibul Hoque
Huazhong University of Science and Technology

Abu Naser Mohammad Saif
University of Dhaka

Adnan Mustafa AlBar
King Abdulaziz University

Yukun Bao
Huazhong University of Science and Technology

Information and Communication Technologies (ICTs) play a key role in today’s business environment. ICTs also give small firms a competitive advantage in the new economy. However, little empirical research has addressed the issues of use, impact and adoption of ICTs in Small and Medium Enterprises (SMEs), especially in rural areas of developing countries. The objective of this study is to identify the impact of ICTs and the factors that influence the adoption of ICTs in SMEs located in rural areas of Bangladesh. This article follows a qualitative and quantitative research approach based on a case study and structured questionnaires. The regression analysis showed that awareness of benefits, government support, top management support, and financial support are important determinants of the adoption of ICTs in rural SMEs in Bangladesh. This article also highlights the limitations that SMEs have in using ICTs and makes recommendations on how to overcome them.

  Information and communication technologies, Small and medium enterprises, Bangladesh
  Savar, Paba, and Sitakunda, from three districts, namely, Dhaka, Rajshahi and Chittagong, in Bangladesh
  
  
  Knowledge Management
  ICT, Adoption of technology

The purpose of this study, therefore, is to analyse and evaluate the impact of ICT and the factors that influence the adoption of ICT in the rural SMEs of Bangladesh.

Methodology: This research incorporated a qualitative and quantitative research approach based on a case study and structured questionnaires. This study also applied the Most Significant Change (MSC) technique proposed by Dart and Davies (2003) to evaluate a complex, participatory, rural development program in Bangladesh. Davies and Dart (2005) clearly identify the values that prevail in an organization and have a practical discussion about which of those values is the most important. MSC has largely been used for the evaluation of international development programs (Davies 1996). In Bangladesh, government agencies (e.g. the SME foundation and Bangladesh Bank), together with donor agencies, are playing an important role in fostering the adoption of ICT in SMEs, especially in rural areas  It was expected that MSC techniques would better explain the ICT adoption behaviour of SMEs in rural areas of Bangladesh. In principle, MSC looks at positive and negative changes, but in practice, it is biased towards positive change . MSC will help to develop a strategic plan for the ICT Program in the rural SMEs of Bangladesh. The MSC technique is suitable for qualitative indicators as it involves the regular collection and participatory interpretation of ‘‘stories’’ about changes. Stories are pivotal, point to human intelligence and things such as relationships, and are a sequence of events; cause and effect can be defined by stories.

Study area: The study was conducted in three Upazilas (the second lowest tier of regional administration in Bangladesh), including Savar, Paba, and Sitakunda, from three districts, namely, Dhaka, Rajshahi and Chittagong, in Bangladesh. This research seeks to understand the impact of ICT in SMEs of rural areas in Bangladesh. 

Data collection Qualitative perspective. The purposive sampling method was used to select a total of three SMEs from three Upazilas to compile case studies to gain more in-depth insight into their ICT behaviour. It is the only viable sampling technique in obtaining information from a certain cultural domain with knowledgeable experts within a very specific group of people. Due to confidentiality purposes, these three SMEs are given the names ‘Firm A’, ‘Firm B’, and ‘Firm C’. These three firms, located in three Upazilas, adopted ICT to facilitate their functional activities. Some information about these three firms is presented in Table 2.

Data were collected from 50 interviewees in the three selected SMEs through on-site observation, face-to-face interviews, and informal conversations. The interviewees were asked semi-structured questions about the use, challenges and opportunities with a view to generate stories of their experience regarding the ICT. The participants of the study were asked questions such as the following: ‘How do you benefit from the use of ICT in your business?’ ‘Has ICT contributed significantly to raise the income and productivity of this business?’ ‘How does ICT help to augment skills?’ During the interview, they expressed their problems, feelings, and experiences related to ICT. In addition, respondents were encouraged to report why they consider a particular change to be the most significant one. The interview was audio recorded in the local language and translated into English by the research team. Some important notes were written by the researchers, and then transcripts were written. The stories were developed from the transcripts later on.

Quantitative perspective. The literature review identified many factors that influence the adoption of ICT in SMEs. Based on the literature and considering the context of SMEs in Bangladesh and the findings from the qualitative study, this research identified six independent variables that significantly influence the adoption of ICT. These are: awareness of benefits, financial support, infrastructure, resistance to organizational change, lack of top management support, and lack of government support. The dependent variable of this study is intention to adopt ICT. The following hypotheses were developed to understand the influence of the independent variable (factors) on the dependent variable (adoption).

  Information Development 1–15; Downloaded from idv.sagepub.com at PENNSYLVANIA STATE UNIV on May 16, 2016
  DOI: 10.1177/0266666915578202
Funding Source:
1.   Budget:  
  

The SMEs in developing countries like Bangladesh can become modernized and industrialized if they can extensively apply ICT to enhance productivity and competitiveness. Many SMEs, especially in rural areas, are taking advantage of ICT, which is essential for local and global competition. This study has revealed that the level of ICT adoption among SMEs in rural areas of Bangladesh is lower than expected. The results of this study also indicated that the key factors of ICT adoption in rural SMEs in Bangladesh are top management support, government support, financial support and awareness of benefits. Research into how ICT can enhance SMEs to keep them competitive and sustainable in the knowledge economy is at the top of many governments’ agendas around the globe. However, there is still a lot of research needed in this area, especially from the Bangladesh point of view.

  Journal
  


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