INFORMATION TECHNOLOGY CAPABILITIES AND SME PERFORMANCE IN KENYA: A REVIEW OF LITERATURE
Abstract
In all emerging nations, the emergence of SMEs is crucial because they foster economic growth and enhance income distribution, productivity, efficiency, and economic structure in tough times. SMEs' capacity for innovation allows them to adapt to changes in the pace of information technology and the preferences of new clients. The development outcomes from SMEs' adoption of IT must be integrated with the companies' operations. Redesigning a website needs to be integrated with how SMEs operate. The ability of SMEs to tap into technological capabilities remains crucial to their survival by creating an edge of their rivals and also leveraging on the benefits that follow such investments. Most SMEs are yet to consider the use of ICT to enhance the performance of their business, crippling and eventually eliminating them because of their inability to compete against major establishments. This study therefore sought to explore information technology capabilities on the performance of SMEs. The general objective of this study was to investigate the influence of information technology on the performance of SMEs. The specific objectives of this study were: to determine the influence of information technology capability on performance of SMEs in Kenya, to establish the influence of absorptive capacity on performance of SMEs, to explore the influence of firm size on performance of SMEs. This study targeted research articles related to ICT capabilities and performance of SMEs. Convenience sampling was considered and research materials were analyzed as they became available to the researcher. The studies indicated a low uptake of ICT by SMEs especially in least developed countries. This therefore implied that there is need for these firms to leverage on existing technologies, especially the ones who cost is negligible so as to improve their competitiveness. The results of this study guided SMEs to leverage on innovative technologies with the aim of not only improving their workflows, but also with the aim of improving their position in the market.
Key words: ICT Capabilities, SME performance, Absorptive capacity
CITATION: Mwangi, G. M., & Kyallo, J. (2023). Information technology capabilities and SME performance in Kenya: A review of literature. The Strategic Journal of Business & Change Management, 10 (2), 1002–1009.
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DOI: http://dx.doi.org/10.61426/sjbcm.v10i2.2646
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