Local small and medium enterprises (SMEs) consider access to general resources such as premises, transport and basic infrastructure to be more important than access to IT and Internet infrastructure.
This is according to a recent survey based on 6 059 decision-makers in SMEs, who were interviewed about the factors behind their competitiveness.
The study took around three months and was concluded with a national roadshow last week.
The research was carried out by World Wide Worx, Coolcumba Communications, Netsurit and Fizz Marketing, and was sponsored by Standard Bank, MWEB Business and Microsoft.
The principal analyst for the survey, World Wide Worx MD Arthur Goldstuck, says although 82% of respondents regarded IT and Internet access as "important", 78% believe they cannot focus on IT without first taking into account adequate infrastructure.
"Even though respondents say IT does offer businesses a competitive advantage, they believe IT has to take second place to infrastructure," says Goldstuck.
"On the other hand, if the general infrastructure is in place, then access to IT and the Internet becomes critical, as it has also been shown in this study that companies that have Internet access are far more competitive than those that do not," he says.
E-mail has a positive impact
Goldstuck says although e-mail usage didn`t rank as highly as other IT applications, 69% of SMEs across all industry sectors in SA regard the impact of e-mail on competitiveness as positive, 18% say it has a negative effect, and 13% are neutral. Spam played a role in the negative vote.
Broken down by industry sector, 89% of respondents in the IT software and services sector saw e-mail as positive, 88% in advertising and marketing were positive about it, 84% in hotels, accommodation and legal services were positive, and 82% of respondents in financial services were positive.
"These appear to be sectors where communication and document sharing are critical elements of business processes and strategy. If only these sectors were considered, e-mail would be the most highly rated of all IT applications," says Goldstuck.
He says the uneven results across different sectors come as something of a surprise. "To those proficient with technology, it appears odd that e-mail is not universally perceived as a boon to business.
"However, there is a definite gap between the technology literate and those who don`t see a natural place for IT in their businesses. This has a profound impact on perceptions of the effect of e-mail on business," adds Goldstuck.
He says it`s probably because small businesses don`t understand how to use e-mail as a tool for productivity and have not yet learned how to handle the negative aspects of e-mail, like spam and viruses.
Less benefit from online banking
Goldstuck says in general, SMEs make less than expected use of online banking, which he attributes in part to the cost of Internet access.
"In about five years it is expected that Internet connection will be less expensive."
He says businesses do perceive online banking as having a positive impact on their competitiveness; 82% of those who use electronic banking regard themselves as competitive, against 70% of those who don`t use electronic banking.
IT spending
With regard to IT investment, World Wide Worx reveals that spending on IT as a proportion of turnover rose marginally from 2003 to 2004. However, it is expected to drop somewhat this year.
While 42% of respondents said they had spent more than 1% of turnover on IT in 2003, 44% did so in 2004, dropping back to 43% in 2005.
However, World Wide Worx reveals that given the growth of the economy, reflecting growth in turnover, it can be assumed that there will be overall growth in IT spending by SMEs in 2005.
Other findings include the level of reliance on retailers falling substantially, suggesting that retailers are not meeting SMEs` IT needs.
Goldstuck concludes: "Access to resources can be viewed as akin to building a house, with expertise and finance seen as the foundation, while general and IT infrastructure creates the walls and BEE status forms the roof that protects the SME from the weather of a changing business environment."
Related stories:
Share
