ICT as a Strategic Enhancer in Small Firms: A Study of New Zealand and Scotland

• Author: Jo Bensemann,John Sanders,Laura Galloway
• Date: 01 November 2016
• DOI: http://doi.org/10.1002/jsc.2099
• Published date: 01 November 2016

RESEARCH ARTICLE

Strategic Change 25: 647–657 (2016)

Published online in Wiley Online Library

(wileyonlinelibrary.com) DOI: 10.1002/jsc.2099

Copyright © 2016 John Wiley & Sons, Ltd.

Strategic Change: Briengs in Entrepreneurial Finance

Strategic Change

DOI: 10.1002/jsc.2099

ICT as a Strategic Enhancer in Small Firms: A Study

of New Zealand and Scotland1

Laura Galloway

Heriot‐Watt University, Edinburgh, Scotland

John Sanders

Heriot‐Watt University, Edinburgh, Scotland

Jo Bensemann

Massey University, Palmerston North, New Zealand

ICT use in small rms in New Zealand and Scotland is strategic but not necessarily

associated with growth via external markets.

Many studies have advocated the theoretical benets to a rm of adopting tech-

nologies, and particularly Internet technologies. ese include improved e-

ciency, access to supply chains, and access to extended markets, and broadly infer

improvements in competitiveness (e.g., Lawson et al., 2003; Haugh and Robson,

2005; Bharadwaj and Soni, 2007). is is highly attractive to small rms (i.e.,

rms with fewer than 50 employees), in that the Internet environment represents

a more level playing eld amongst dierent rm types, and for small rms and

new rms, an opportunity to compete with larger and more established organiza-

tions. On this basis, much of the small rms literature in the last decade or so has

focused on exploring the motivating features inherent in the potentials of informa-

tion and communications technology (ICT); the reasons why small business

owners might want to adopt Internet technologies, and investigating what they

anticipate will be the returns (e.g., Galloway et al., 2004). To date though, there

has been little investigation of the actual outcomes of ICT engagement and use.

To make some contribution to this gap, the current article reports a study of the

outcomes of the adoption of ICT for a sample of 302 small rms in New Zealand

and Scotland. With reference to recent theorizing on levels of ICT absorption in

rms, from basic to sophisticated use, the article also explores how developed (or

not) small rms’ ICT engagement is. In addition, it explores the extent to which

ICT adoption and use has been the consequence of strategic objectives or orienta-

tion in the sampled rms, and how ICT‐related strategic objectives are approached.

1 JEL classication codes: L10, R30.

Amongst the sample of rms, all

of which are Internet participants,

no variation in sophistication or

strategic use of ICT is observed

between small and very small

(fewer than 5 employees) rms.

New Zealand small rms exhibit

more sophisticated use of ICT

than Scottish small rms, and this

is linked to different norms and

expectations amongst users in

each country rather than

differences in growth or

development orientation between

the two countries.

Further empirical and theoretical

work on strategy and small rms

is recommended, particularly since

there is some suggestion from this

study that small rms’ ICT

strategies are reactive, emergent,

and not necessarily associated

with growth.