SME technology uptake

Better than free
http://www.smartcompany.com.au/Blog/Josh-Catone/20080827-Better-than-free.html?source=cmailer
Galpert lays out a list of five things he thinks that people are still willing to pay for. These concepts can be applied to almost any product or service:

Convenience. People are lazy, says Galpert, which is why they’ll still pay for music tracks on iTunes, rather than get it from a P2P network. If you can offer them convenience over free alternatives, they’ll pay for it.

Quality. Access to higher quality content, products, support, or community features is something that people are willing to pay for. If a subscription fee keeps spammers out of a forum and makes it more attractive to industry professionals, then people will be willing to pony up the dough, for example.

Additional functionality. Galpert cites 37signals, which has pioneered the “freemium” model on the web by giving away a free appetiser, but charging for the full meal. The danger, as Stern points out, is knowing how much to give out so that your pay product is still an attractive upgrade for enough users.

Customisation. Customisation is a great value-added feature for many products, and people are willing to pay for it. Galpert uses Wordpress.com as an example. The site offers free blogs for anyone, but to customise the CSS or use your own domain name you have to fork over some cash.

Privacy. While privacy should be built into any service at any pay level, additional layers of privacy are something that people will pay for. Galpert talks about GoDaddy, which offers a premium service that allows people to mask their information on WHOIS searches.

Galpert’s list is helpful for anyone offering a web product or service that has to compete with free offerings. Competing with free is difficult, but as the example above show, it is not impossible.

Work dries up for SMEs as slowdown hits
http://www.smartcompany.com.au/Free-Articles/The-Briefing/20080828-Work-dries-up-for-SMEs-as-slowdown-hits.html?source=cmailer
The rapidly slowing economy is hitting small businesses hard, with 20% reporting that their greatest concern at present is a lack of work.

The latest Business Index from Sensis reveals expectations among small business owners have slumped to the lowest point in the 15 year history of the survey. The business confidence indicator currently sits at 25%, which is less than half the level recorded this time last year.
Finding quality staff, which has been the biggest concern for businesses over the last two years, is now only the fourth biggest worry. Money is at the front of business owners’ minds; a lack of work, the general economic climate and cashflow are now companies’ biggest concerns.
One in four businesses reported deterioration in profit since May.

The report also shows 14% of small businesses have reduced their workforce since May, with 30% citing a downturn in business or the closure of a business unit and 25% blaming economic conditions.

Report author Christena Singh says small businesses reported a lack of work or money is the main impediment to taking on new employees in the future.

But Singh says SMEs appear to be working hard to combat the impact of the slowdown, with 20% working to reduce costs in the last few months.

“Many businesses are taking a more aggressive stance, including advertising more, diversifying the business, seeking new business opportunities and developing new products in an attempt to attract customers,” she says.

Overall, 11% of small businesses are advertising more, 8% are diversifying business, 7% are looking for new business and customers, and 6% are adding new products or services.
The report also reveals support for the Rudd Government continues to slide, with almost 40% of respondents saying the Government’s policies work against small business. In June 10% of respondents said the Government’s policies support small business.

The state of the economy was the key reason small business has turned on the Government, followed by the perception there is too much bureaucracy and that interest rates are too high.

Small business headed for cash crisis
http://www.smartcompany.com.au/Free-Articles/The-Briefing/20080825-Small-business-headed-for-cash-crisis.html?source=cmailer
Almost three quarters of businesses plan on seeking a short term injection of capital if they get into financial difficulty, and think their bank would be accommodating, a new survey from CPA Australia shows.

But they could be in for a nasty shock. The credit crisis means their bank is likely to be less agreeable, which may have serious implications for the business. CPA Australia’s business policy adviser, Gavan Ord, says many businesses will need to unlock reserves of hidden cash to improve cash flow rather than rely on external sources of finance.

The latest CPA Small Business survey of 500 small businesses with less than 20 staff, found that 41% of businesses never prepare a cash flow forecast and 25% never chased up late payments. Almost 70% of businesses surveyed do not even prepare quarterly financial statements.
“This is a recipe for disaster,” Ord says. “Keeping books up-to-date, preparing budgets, including cash flow forecasts and comparing actual results against budgeted results, are essential… and puts businesses in a far better position to manage their cash flow resources and profitability.”

The survey also found that 36% of those surveyed had to borrow in the past year for business survival, with banks being the most common lender. Surprisingly, 39% of small businesses that have borrowed funds do not know the interest rate on those borrowings.
Even more surprising, given the downturn, 66% of those surveyed expected their businesses to grow in the next few years. Ord says the high levels of confidence could be attributed to the economic prosperity of the past decade.

“Many small business owners wouldn’t have experienced an economic downturn, having run businesses only though the buoyant conditions of the past decade, and so may be relatively unprepared.”

An investigation of the enablers and barriers to industry uptake of e-learning: Small business
http://www.flexiblelearning.net.au/flx/webdav/site/flxsite/shared/Benchmarking%20and%20Research/Small_Bus_Exec_Summary_final.pdf
Extracts: This study confirmed that on-the-job, informal training is predominant in the small
business sectors surveyed, particularly in manufacturing. Informal training appears to be
more common than formal or structured training for all aspects of training, with the
exception of professional and technical development. This finding reinforces many other
studies which report that small business training is focused at short-term, unplanned
‘bite-size chunks’ targeted at immediate business needs.

Whilst most surveyed businesses claim to hire staff with the expertise needed for the job,
there is a widespread view that training is important and that more effort would be placed
on staff training if time and money permitted, particularly for those businesses with
growth intentions.

Some 40% of businesses surveyed have a relationship with a training provider, most
commonly a professional or industry association, TAFE college, private provider or group
training organisation. However, around 60% reported that they have no such
relationship, indicating a lack of engagement of the training sector with small business
and hence an important ‘gap’ in the role that training providers can play in creating
awareness and facilitating the uptake of new training and learning options.

Almost one-third of survey respondents reported at least some use of electronic methods
for staff training. The reported use of electronic methods was notably higher for
businesses in the property and business services sector and for businesses where the
owner/manager was more qualified or had personally experienced the use of e-learning
in recent times. Comparing this result with ABS data from 2001-02 on small business
training practices would indicate significant growth in the use of computer-assisted
learning in small business over the past five years.

The key factors reported by survey respondents to be driving the use of e-learning
methods were convenience, flexibility, training material provided by the supplier, easier
access, or the business operates remotely from a suitable source of training.
For respondents who reported little or no use of e-learning, the main reasons were that
this method was not applicable to their business or that they preferred hands-on, face-toface
training. Others reported that they were not aware of, or had not considered
e-learning tools, they did not have the time or money to research or implement
e-learning solutions, or that their employees did not need further training.

Potential impediments to the uptake of e-learning by small business identified in the
Framework’s Industry Engagement Projects and other studies in Australia and overseas
include time and cost, technology limitations, workload pressures, lack of an e-learning
‘champion’ and the widespread preference for informal, hands-on, experiential learning.

Notably, many non-users of computer-assisted learning mentioned that they were
unaware of suitable e-learning tools or that they had not considered e-learning as a
viable means of learning. This would suggest that lack of awareness of e-learning
solutions and their potential value to small business may be an important barrier to
greater uptake.

Information Technology – its impact on small business
http://www.cpaaustralia.com.au/cps/rde/xbcr/SID-3F57FECA-CB45DAB9/cpa/20061101_it_survey.pdf
Extracts:
2. Computerisation of business processes
Ninety-one per cent of the small businesses surveyed stated they have computerised their bookkeeping and 83 per cent for managing of debtors and creditors, while almost half have computerised stock and customer relationship management (46 per cent and 49 per cent respectively) (Table 2.1). As firms get larger (measured in terms of staff numbers) they are more likely to computerise business functions. For instance, the stock management function is computerised in 30 per cent of firms with between one and two employees, 49 per cent of those with three to four employees, 54 per cent of those with five to nine employees and 60 per cent of
those with 10 to 19 employees.

Table 4.1 shows that for most of the small businesses, investment in IT was not significant when compared to their overall capital investment. The average investment in IT as a proportion of business capital was estimated by small businesses to be about 12 per cent. However, small businesses in service industries and those with clients interstate or overseas had the slightly higher average estimate of 15 per cent. Also, the IT investment proportion was lower as the age of the proprietor increased with an average of 14 per cent of business capital for proprietors under 40 compared with nine per cent if aged 60 or over.

Understandably, around two-thirds to three-quarters of the small businesses sampled claim they would increase their IT investment if it led to lower costs (75 per cent), higher sales (69 per cent), increased efficiency (76 per cent) or business innovation (67 per cent) (Table 4.2). These findings were fairly consistent across small businesses although there were more businesses willing to increase investment among firms with 10 to 19 staff members.

Small businesses were asked to provide reasons why they felt they did not get the full value from their IT systems. Table 4.9 illustrates that the main reasons were ’we don’t fully utilise it’ (35 per cent) and ’our skills need updating’ or ‘we are not fully computer literate’ (24 per cent). Other reasons provided by small businesses were mentioned by 10 per cent or fewer.

While the majority of small businesses believe they benefit from IT, there seems little control or measurement of small business IT investments. Around nine in ten small businesses stated they did not have a required return on investment (ROI) on IT (93 per cent) and 88 per cent said they did not measure IT benefits (Table 4.10). Among the small number which measure IT benefits, the most common measurement used is ’time and efficiency study’ with the second most common measure related to profits and sales.

Many small business owners are concerned about data security and the potential impact on their business if their valuable data is lost, stolen or corrupted. The high level of this concern has often been quoted as a reason not to computerise aspects of small businesses. When considering current issues with data security, this survey found that 46 per cent of small businesses claim to have an IT security policy (Table 6.1). This is a surprisingly high proportion given the general reluctance among small businesses to formalise processes. However, 21 per cent do not believe their company data is as secure as it could be. Younger business owners and managers were even more aware of potential problems with data security. Almost all businesses have some form of virus protection (94 per cent), and a good majority had installed firewalls (83%), and passwords (87%) with regular software updates another common security feature (87%).
Small businesses are also becoming more conscious of the value of managing their data with 47 per cent updating their IT security measures at least once a month. Fifty-one per cent backup data daily, 77 per cent do so weekly while only three per cent never backup data. Sixty-six per cent of the small businesses also keep their backup data off-site.

The findings of this survey also illustrated that there is a correlation between firm size and having a more advanced IT security policy. Larger firms, as would be expected, were found to be more sophisticated and regular in their security arrangements.

Exploring the Reasons for a Failure of Electronic Payment Systems: A Case Study of an Australian Company
http://www.jrpit.acs.org.au/jrpit/JRPITVolumes/JRPIT39/JRPIT39.4.231.pdf
Abstract: This paper examines factors which lead to the failure of electronic payment systems(EPS). In order to understand these factors a single case study of a failed Australian EPS was conducted.

The findings confirm the influence of EPS adoption factors identified from the literature, which
include cooperation with established entities, simplicity, trust, security and mutuality of stakeholder benefits. Furthermore, this study has specifically demonstrated the importance of large partners in the adoption of EPS. These partners are able to provide EPS with access to a large installed base of customers, association with their brand name and marketing resources in order to achieve public awareness. This paper contributes to theory and practice through examining a failed case from the system provider’s perspective, which is rare in the study of EPS.

IDC finds local small business plays hard and fast with technology
http://www.crn.com.au/News/65810,idc-finds-local-small-business-plays-hard-and-fast-with-technology.aspx
IDC's latest study on the purchasing process in Australian Small Businesses reveals that they purchase technology in the same way they conduct business – very quickly.

In the independent research company’s latest research titled, "Understanding How Australian Small Businesses Buy Technology: I Want it and I Want it Now!" small businesses operate in a highly dynamic environment and success means reacting instantly to changing conditions. This market is valued at $10 billion in 2007 and represents 25 percent of total Australian information and communication technology (ICT) spend.

In IDC’s latest study, Australian Small Businesses will often purchase technology as a reaction to change. For SMBs technology is critical, providing competitive advantage and increased productivity. Technology directly impacts their bottom line. So when conditions change, the purchase has to happen quickly.Jean-Marc Annonier, IDC's research manager for Small and Medium Business Markets said these businesses purchase technology very differently to enterprise organisations. The chains of command in small businesses are short, with business managers often move very quickly from need-identification to a purchase-approval."

A small business' entire purchasing process tends to be extremely short and requires huge reactivity from technology providers - the number of touch points a vendor will have with a customer is reduced to an absolute minimum. Busy managers don't have the time to go through lengthy sales cycles," said Annonier.When the purchase concerns highly commoditised products such as PCs and printers, the entire sales cycle might be skipped altogether. Decision makers will often go to the closest retail outlet such as Dick Smith Electronics or Harvey Norman and purchase on an ad hoc basis, he said."

The current economic conditions are very favourable to small businesses, more than 10 years of solid economic growth have put businesses in a financial situation propitious to investment. Technology is one of the major vehicles that will drive future growth for these organisations," said Annonier.

The IDC study also finds that vendors struggle to cost-effectively sell to a fragmented small market. Additionally, almost half of small businesses prefer to use a single source for their IT products and services, with whom they have worked in the past and are satisfied. This result illustrates the importance of establishing a strong business partnership between IT suppliers and customers for long-term business opportunities.

Strategic Orientation and Innovation Performance Between Family and Non-
Family Firms
http://www.buseco.monash.edu.au/units/fsbru/tanewski-et-al-icsb2003.pdf
Abstract: A key concern in the family business literature is whether family firms differ from professionally managed firms. Some studies have found that there are no significant differences, whereas others have found that family firms differ from non-family firms in a number of key areas such as strategic posture. As such, this study examines the innovation performance between family and non-family enterprises, and expands our understanding of family firms by examining innovation in relation to strategy, organizational structure, and environmental hostility. Participants involve a random stratified sample of 2,000 small and medium size family and non-family owned businesses in manufacturing and service industry sectors in Australia. Using structural equation modeling (SEM), our findings reveal significant differences between family and non-family owned businesses on process innovation and strategic orientation. Notably, SEM estimates indicate that family firms are less innovative, emphasize industry leadership less, but have a greater prospecting orientation than non-family firms. SEM results demonstrate good fit for the hypothesized model ( χ2 = 22.86, df = 6, p < .001; GFI = .969, AGFI= .893), and provide support to the hypothesized relationships between strategic orientation and innovation performance, and between strategic orientation and organizational structure. Findings from this study demonstrate that family and non-family owned firms not only differ in their innovation performance, but they also have different strategic orientations, which provide some support to findings that family businesses put less emphasis on industry leadership. Given that new product and service development is generally considered important for understanding a firm’s entrepreneurial activities, this study assists in increasing our understanding of firm-level entrepreneurship and innovation.
Work/Lifestyle balance
http://myob.com/servlet/Satellite?cid=1113874823750&pagename=MYOB%2FPage%2FContentPageWithNav&c=Page
Special focus report - December 2007 extracts:

• Most small business owners who aimed to be their own boss /make their own decisions have achieved this or are close to achieving it
• Around three quarters of small business owners are satisfied that they have achieved thier goals
• Most small business owners are satisfied with their overall lifestyle
• Running their own business has a positive impact on the lifestyle of most small business owners
• Many small business owners who are dissatisfied with their current lifestyle believe that running their own business has a negative impact on their lifestyle
• Most small business owners believe that running their own business has had a positive impact on their work-life balance
• Around three in five small business owners believe their stress is manageable both in their life and in running their business
• Over a third of small business owners, who were previously in fulltime employment, believe that their stress level has increased since owning a business
• Many small business owners keep working when they are sick

Working Patterns and Internet Use
http://myob.com/servlet/Satellite?cid=1113874823750&pagename=MYOB%2FPage%2FContentPageWithNav&c=Page
Special focus report - July 2008 extracts. Report contains breakdowns by industry sector:

• The most common activities completed online are Internet banking, paying bills on supplier websites and using webmail
• Majority of small business owners estimate they spend between 1 and 5 hours online in a typical workday
• Majority of small business owners estimate spending between 1 and 5 hours sitting at a computer on a typical workday
• Just under half of small businesses currently have a website
• One-third of website users currently sell goods or services online
• Three-quarters (75%) of small businesses have had their website for less than 5 years
• The majority of small business owners surveyed have recently updated their website
• Half of small businesses do not have a domain name registered
• One third of small business owners estimate they work over 50 hours in a ‘typical’ work week
• Almost half (46%) of small business owners say they worked 6 or 7 days per week in a ‘typical’ work week
• One third (34%) of small business owners estimate they worked
• More than 10 hours per day in their most recent ‘typical’ work week
• The majority (61%) of small business owners estimate they spend between 1 and 5 hours a day working away from their office or place of work

What Is the Future of E-Mail?
http://www.emarketer.com/Article.aspx?id=1006334
MAY 27, 2008 - An old digital format still has plenty of life left

Compared with today's virtual worlds, e-mail is solidly Web 1.0—an almost archaic communication channel.

Yet e-mail works, and marketers and advertisers keep putting it to new uses. Moreover, consumers—whose opinions are the ones that matter—genuinely like e-mail. Nearly three-quarters of adult e-mail users in North America said they used it every day, according to an April survey conducted by Ipsos for Habeas.

Two-thirds of adult respondents said they preferred e-mail for communicating with businesses. Just as many—and this is the important part—said they expected to still prefer e-mail five years from now.

"Far from being eclipsed by Web 2.0 and other emerging communications methods, consumer expectations suggest that e-mail will be the workhorse channel around which future online communications will revolve," said Des Cahill, CEO of Habeas, in a statement.

That is not to say that consumers are ready for random, untargeted e-mail. Opt-in is still key. Consumers are even willing to help marketers custom-tailor their messages. More than 88% of respondents said they would like more choices in e-mail content and frequency, including options on advertisements and special offers.

So if e-mail is set to remain a consumer favorite for the next several years, that must mean e-mail ad spending will grow during that time, right?

Yes and no.

eMarketer predicts that e-mail ad spending in the US will hit $492 million this year, then increase by 55% to $765 million by 2012.

Not Your Father's Collaboration
http://www.accenture.com/Global/Research_and_Insights/Outlook/By_Issue/Y2008/fatherscollaboration.htm
Extract: More and more companies are beginning to see collaboration technologies as "killer apps" they can harness to transform their companies and, ultimately, to power innovation.

Way back, we collaborated through face-to-face meetings, office memos, snail mail and informal conversations at the proverbial watercooler. Over the years, as the pace of business quickened and companies became more dispersed, various technologies—fax, e-mail, imaging, workflow, conference calls, videoconferencing—were introduced to support communication across a geographically distributed workforce.

But in each case, the technology simply "electronified" a well-understood, existing communication channel. In fact, experts often invoked a framework to describe collaboration technologies, suggesting that the Holy Grail in this realm was to achieve "telepresence" (see chart). In other words, the goal was to replicate the effects of co-location and face-to-face interaction.

New Ways of WorkingToday, we're starting to realize that the real promise of collaboration technologies lies in supporting new ways of working and interacting that simply were not possible or feasible through traditional means. That's a shift with huge implications for corporations.

Tactically, it means that by systematically introducing appropriate technologies to support collaborative processes, companies can improve communication among their knowledge workers while simultaneously reducing the overhead of reading and responding to e-mails. Strategically, the implications are far greater: With new collaboration technologies in place, companies are poised to dramatically improve their capacity for innovation.

To understand where collaboration technologies are headed, consider a very different framework that characterizes collaboration in terms of two new attributes.

• Reach: an individual's ability to identify and effectively collaborate with the right people wherever they are (geographically and organizationally).
• Awareness: an individual's ability to maintain continuity of information flow with one's collaborators

Online banking just got easier
http://www.smartcompany.com.au/Free-Articles/Trends/20080604-Online-banking-just-got-easier.html?source=cmailer
Wednesday, 4 June 2008

Online banking has taken off in recent years, but until now an inconvenient off-line feature has impeded its growth – consumers still had to lodge a signed paper application by post or fax. That impediment now looks set to become a thing of the past. A firm called FCS Online has developed an electronic identity verification process that replaces the humble signature with checks on personal information ranging from birth date to passport and visa details.

The process has already been adopted by one bank with an online focus, ING Direct, in the hope of cutting back on the number of customers who express interest in an account but don’t meet the paper requirements, which reportedly could be as high as 40%.

The shift to online verification has partly been made possible by legislative changes that were introduced late last year that changed the security focus away from the traditional 100-point paper check to electronic verification.

Google Apps for SMEs (in Learn to Use Google Apps with ‘The Missing Manual’)
http://blogs.bnet.com/businesstips/?p=1584&tag=nl.e713
From Gmail to Calendar to Google Docs, Google Apps offers small businesses a wealth of communication and productivity tools. But figuring out how to use them all can be tricky, especially if you’re more accustomed to traditional software. Enter O’Reilly’s Google Apps: The Missing Manual, a new book that teaches you the service from top to bottom.
The tome covers not only the individual apps (including GTalk and Google Sites), but also topics like managing users and domains and leveraging the Marketplace. You can get a content preview of each section of each chapter by clicking the above link.

Issues Faced by Small and Medium Enterprises (SMEs) and Their Take-Up of
Ecommerce in Australian Regional Communities
http://eprints.usq.edu.au/1349/1/WebO3.pdf
From the above, critical mass was not seen as a trigger for the adoption of innovation by these three firms. The real trigger was recognition of a strategic opportunity or a realisation of the strategic necessity to operate online. Two of the three proprietors cited the valuable role played by local networks and assistance helping them to get started. All three players cited the lack of business planning and foresight shown by local SMEs as impeding the adoption of ecommerce generally in the region.

Influences on Uptake of Innovative Technology in the Australian Food Industry
http://www.insyl.unisa.edu.au/publications/theses-papers/Wilkins.pdf
3.3.2 Barriers To Uptake Of G2B Electronic Service Delivery
During the 1990’s, benchmarking progress was used as a key instrument to motivate public sector efforts in implementing electronic service delivery by competition. In this early period for eGovernment development, many countries enacted policies promoting the transition to e-government service delivery models. Strong operational pressures exist in public sector contexts for least cost solutions and enhanced functionality. These pressures were accompanied by portrayals of eGoverment as a panacea for all perceived weaknesses in government service delivery. However, many of these early implementations resulted in repeated cost over-runs, project delays, false savings or low benefit/cost problems (NAO, 1999; NZNAO, 2000; Treasury Board of Canada, 1998).

Recurring management problems that have affected eGovernment implementations in the United Kingdom, Canada and Australia include governance issues such as lack of crosssectoral leadership capacity, obscure or non-existent management lines of responsibility for developing e-government, unclear accountability parameters for agencies, spiraling coordination costs, unanticipated knowledge transfer issues, the use of artificial timetables setting unrealistic targets and lack of direction and leadership from complacent senior management leading to policy fragmentation (NAO 2001; Dunleavy et al, 2001; Seddon, 2001). Channel rivalries and coordination issues are two frequently identified management constraints to G2B electronic service delivery and hence discussed at greater length in the following chapter sections.

3.3.2.1 Channel Rivalries
Government agencies increasingly have to operate in ‘two spaces’ simultaneously – the physical and the virtual (Kimble et al,, 2000). The move online offers the potential for conflict at a number of different levels. For example, a National Audit Office study in the United Kingdom found that centralisation of power intended to achieve increased economy and efficiency in public spending, in practice fragmented the system for delivering service outputs and resulted in a culture built on silo principles (NAO, 2001). Narrowly defined, output driven performance created irrationality and inefficiency at an overall system level. This typology of agency culture in the UK has been blamed at least in part, for some disappointing e-government indicators. Similar problems have also been noted in achieving cooperation between Australian government agencies (Humphrey, 2000). The implementation of electronic service delivery has the potential to affect many tiers of public sector management. As an innovation it requires the management of new policy regimes that inevitably overlap pre-existing arrangements and procedures with the attendant risk of increasing complexity. New technological systems also tend to develop towards further specialisations of sub-systems. Where innovation is resisted, channel rivalries can act as barriers from established departments and agencies. The impact of these barriers is evident in current findings from benchmarking studies indicating that national E-government management teams remain the exception rather than the rule (UNDPEPA, 2002). Fundamental re-engineering of departmental processes to respond to web capabilities occurs very infrequently and in many cases, no fixed budget lines for Internet development exists (Dunleavy et al, 2001). Barriers to implementing ESD noted in the UK and Australia are not confined to these countries. At the time case study data was collected for this research project, the bulk of government online mirrored offline agency structure with little evidence of a customer view driving interactions (Accenture, 2002c, p.9).

3.3.2.2 Coordination issues
Even where all actors accept a common interest in achieving shared goals, synchronisation, design fit, assignment and realisation problems with innovation attributes can recur as problems (Dunleavy et al, 2001). Government agencies are expected to perform delicate balancing acts to ensure implementation of legislation stringent enough to provide a secure environment but not overly stringent so that the legislation becomes perceived as arbitrary or excessive (James and Anderson, 1999). Where barriers arise, coordination difficulties tend to increase, boosting policy complexity. Under-utilisation of innovative services by client industries is usually an indicator of internal and/or external failures within specific areas of government.

Barriers to adoption of innovation across sectors mentioned in the literature include low levels of interaction by organisations in a system, a lack of collective vision of future technology expectations, a lack of coordination of investment, technological problems encountered by firms outside their existing capabilities, changes in technological opportunities that push the market into new areas of technology and difficult transitions to completely new generic technologies where existing technology is embedded in an overall system (Dunleavy et al, 2001). Drivers for electronic service delivery by government and the barriers to its implementation described in this chapter are set out in Table 3.3.

Small business and the use of technology: why the low uptake?
http://www.cric.com.au/seaanz/resources/72WalkerSmallbusinessandtheuseoftechnologyfinal.pdf
The data suggests that the smaller the business the less comprehension there is on the advantages of e-business.

A number of issues have been identified that impact on these findings including micro and small business fear of technology (technophobia), lack of skills and no ‘champion’ to take a mentor role for this industry sector. Both State and Federal Government departments produce documentation and advertising extolling the virtues of e-business for the SME sector and also imply that multitudes of small business who fail to heed these benefits may well not survive in business.

A New Strategy for Micro-Business E-Business Adoption Policy
http://www.agimo.gov.au/publications/2004/05/egovt_challenges/delivery/e-business/smes
Small to medium enterprises make up a very heterogeneous group. The realm of SMEs encompasses organisations with between zero and 200 employees, or an annual turnover of less than $200 million (Australian Bureau of Statistics 2003a). This presents a substantial range of business types and attitudes. Typically, smaller firms have been included in the market only as part of the trading community rather than as an economic cluster (Brown & Lockett 2001). Despite being poorly understood small and new enterprises are widely recognized as 'engines of employment creation' (Audretsch 2002). Micro-businesses with five or fewer employees survive by continuously applying entrepreneurship to preserve their edge.

Considerable fragmentation in SME studies has led to a number of contradictory findings regarding drivers and barriers to uptake (Al-Qirim 2004). What is emerging from larger longitudinal studies however, are clear indications that reasons for adopting e-business and the benefits realised from adoption differ significantly for SMEs from those of larger firms across a number of indicators. The idea that small businesses are miniature versions of large businesses rather than unique in their own right, is gradually giving way to recognition that e-business is a rather complex concept.

One of the small number of shared characteristics of the SME group is the role of the chief executive officer, especially in micro-businesses. Most micro-businesses are virtually ruled by the chief executive officer, who is the sole employee, or the founding entrepreneur, or the head of family (Mintzberg 1992). This individual is typically the dominant strategy setter, and his or her enthusiasm for, or ignorance of, particular business ideas will make or break their adoption and success within the business, particularly in the areas of information technology adoption (Cragg & King 1993; DeLone 1988; Lefebvre, Mason & Lefebvre 1997; Poon & Swatman 1999).
There is little doubt that the chief executive officer's recognition of the business value of the Internet combined with his or her attitude to business growth represent key factors in determining Internet adoption strategies in smaller firms (Cragg & King 1993; DeLone 1988; Lefebvre, Mason & Lefebvre; 1997; Levy & Powell 2003; Poon & Huang 2004; Poon & Swatman 1999). Where the chief executive officer takes on the role of local champion, he or she can play an important role in raising awareness, undertaking investment in the new technology, giving legitimacy and diffusing it through various mechanisms to other actors (Cragg & King 1993; Lefebvre, Mason & Lefebvre 1997; Norgren & Hauknes; 1999). The literature provides strong support for the finding that SMEs will aim for specific adoption strategies to satisfy the chief executive officer's requirements. It is therefore important to take into account that while chief executive officers in smaller firms need to know more about e-business, they appear to be generally positive about e-business per se (Oliver & Damaskopoulos 2002).

The pivotal role chief executive officers play in e-business adoption in smaller firms may explain recent studies which counter the generally pessimistic assessments of tardy and strategically limited adoption of e-business by SMEs. It now appears that small firms can be more proactive in their use of e-business applications than their larger counterparts. Daniel and Grimshaw (2002) found that whilst larger firms were more interested in e-business applications to improve operational efficiency, smaller businesses took a more strategic slant. These smaller firms looked to e-business to extend their ability to respond to competitors, provide enhanced customer services, and improve relations with suppliers. The study also found that smaller businesses believed they had achieved greater benefits from their e-commerce services than had the larger firms in all areas explored.

Evidence of focused investment in e-business by SMEs emerged in another recent study of 27 firms. Contrary to the generally pessimistic literature, managers of SMEs were found to align their information systems and strategic contexts with the expectation of collecting significant benefits (Levy, Powell & Yetton 2001)

Firm-level decision making emerged as a key determinant of technology innovation uptake in the cross-case analysis of the EXDOC case studies (Wilkins 2003). The EXDOC implementation revealed that adoption of innovative technology, such as e-business, occurs historically as a reaction to external pressure. However, adoption because of external pressure - often exerted in the form of mandatory adoption - tends to remain patchy until senior management see industry wide benefits translating to benefits for their individual firms (Wilkins 2003). There is also evidence that even single small firms can play an important role in raising awareness, undertaking investment in new technology, giving legitimacy and diffusing it through various mechanisms to other actors and so acting as local champions for technology adoption (Norgren & Hauknes 1999).

Our brief review illustrates some key points. SMEs are not homogenous and a one-size-fits-all strategy is unlikely to be satisfactory. When focusing on micro-businesses, the chief executive officer of the business is the key decision maker and is the person for whom adoption education and encouragement should be targeted. Finally, although SMEs are not yet vigorously adopting e-business, their adoption is crucial to industry/sector-wide benefits being realised. There is evidence that properly encouraged, micro-businesses will adopt e-business in a strategic and effective manner and that the influence of their adoption might 'punch above their weight' in terms of industry-wide adoption.

Technology Diffusion Within Small And Medium Enterprises In Australia: Report On The Effectiveness Of Dissemination Methods
http://www.smartlink.net.au/library/techdiff.pdf
Conclusion: This report has focussed upon technology diffusion in respect to the issues surrounding its implementation in small and medium manufacturers in Australia. Rogers model of technology diffusion has been taken as a starting point. This model predicts that, during the implementation phase, companies change their structures, personnel, and ways of
doing things until the technology is finally assimilated into the company’s standard operating procedures.

The most recent international survey of global manufacturing companies by McKinsey and Company has identified key organisational changes that are required to be made to
maintain pre-eminence in their field. These changes include international benchmarking, job redesign, job rotation in product development and teamwork in product development
with suppliers, and co-location of product development staff.

Finally the data received from participants in Smartlink seminars around Australia during 2000 and 2001 show Australian manufacturing SMEs have different educational needs and preferences when it comes to assimilating and diffusing information on new technologies. These needs and preferences will have implications for the implementation
of new technology.

Mobile Data Technologies And Sme Adoption And Diffusion: An Empirical Study On Barriers And Facilitators
http://dl.acs.org.au/index.php/ajis/article/view/187/161
Abstract: The technological environment in which Australian SMEs operate can be best described as dynamic and vital. The rate of technological change provides the SME owner/manger a complex and challenging operational context. Wireless applications are being developed that provide mobile devices with Internet content and E-business services. In Australia, the adoption of ecommerce by large organisations has been relatively high, however, the same cannot be said for SMEs, where adoption has been slower than other developed countries. In contrast, however, mobile telephone adoption and diffusion is relatively high by SMEs. Will SMEs who have been reluctant to adopt ecommerce technologies in the past be more ready to go on-line with the merging of the Internet and mobile data technologies?

This exploratory study identifies attitudes, perceptions and issues for mobile data technologies by regional SME owner/managers across a range of industry sectors. The major issues include the sector the firm belongs to, the current adoption status of the firm, the level of mistrust of the IT industry, the cost of the technologies, and the applications and attributes of the technologies.

Technology and gender - female operated SME technology uptake
http://www.ofw.facs.gov.au/work_education/eco_security/wbi_may07h.htm
Whilst technology usage amongst female‑operated SMEs has traditionally lagged their male counterparts, usage levels have significantly improved over the past twelve months. Overall, the proportion of female-operated SMEs with a computer of any type was marginally lower than for male-operated SMEs (95 per cent compared to 97 per cent), however the proportion of female‑operated SMEs with a notebook computer was actually higher than for male‑operated SMEs. There was strong growth in notebook computer ownership amongst female‑operated SMEs, up 15 percentage points over the past year.

Internet penetration amongst female-operated SMEs lagged that of their male-operated counterparts. Overall, some 87 per cent of female‑operated SMEs had an internet connection, compared to 93 per cent of male-operated SMEs. Overall, female-operated SMEs were less likely to have a broadband connection (79 per cent compared to 86 per cent for male-operated SMEs).The take-up of broadband in female-operated SMEs was mainly lower due to their slightly lower propensities to have a computer or an internet connection. Of those SMEs that had an internet connection, the proportion of female-operated SMEs with a broadband connection was the same as for male-operated SMEs (92 per cent).

Over the past year, one of the most exciting areas for technology uptake in female-operated SMEs was in the use of e-commerce. Whilst traditionally female-operated SMEs have lagged male-operated SMEs, the last twelve months has seen significant growth for female-operated SMEs in using technology to sell online. An additional five per cent of female‑operated SMEs reported selling online. The increase from 43 per cent to 48 per cent this year means that now close to half of all female-operated SMEs sell online, with this proportion now behind male-operated SMEs by only one percentage point.

Indeed, this is again influenced by the lower proportion of female‑operated SMEs that are online, and it is interesting to examine the data looking at those SMEs that had an internet connection.Of female-operated SMEs that had an internet connection, some 56 per cent were selling online, compared to only 52 per cent of male‑operated SMEs.

Invisible Opportunities and Irreversible Trends -
Journal of New Business Ideas and Trends 2003 1(1), pp38-49
http://eprints.utas.edu.au/820/1/JNBIT_v1_1.pdf
Compounding the situation is the difficulty small firms face in locating technology linkers who can understand how their core activities relate to web-based opportunities and guide their exploitation (Plume, 2001; Jones et al., 2002). The technology linker is the person/s responsible for transferring specific knowledge related to exploiting the web’s technologies from the market to the firm (Marshall & Reday, 2001). It is common for this role to be performed by Information Technology consultants.

However, given the limited scope of small firm operations, the responsibility of this role may fall to persons without the necessary ability to adequately transfer such knowledge, for example, the local Internet Service Provider (Jones et al., 2002). Therefore, it is possible that the firm may not acquire the specific knowledge required to exploit the web’s technologies. This may result in existing internal selection processes promoting persistence rather than change.

Cultural Barriers in the Adoption of Emerging Technologies
http://www.smartinternet.com.au/ArticleDocuments/121/P06_103_paper.pdf.aspx
Extract: The primary goal of Harker & Van Akkeren’s (2002) Australian study was to understand the mobile data technology needs of SMEs and SoHo (Small Office/Home Office) in a regional setting. They found the following adoption barriers to IT:

§ Owner / manager characteristics such as their perceived benefits of PDAs, computer literacy, perceived control, their mistrust of the IT industry and time and financial pressures.
§ Return on Investment (ROI) - SMEs make many decisions based on ROI. SMEs need technology that provides fast ROI, for SMEs are concerned with small-medium term survival rather than long term market share like large businesses.
§ Firm characteristics, such as organisational readiness (staff, suppliers), market pressures from competitors etc., size, sector and even the structural sophistication of the firm (its current IT infrastructure and need for e-mail, inventory management etc)

According to Harker and Van Akkeren (2002) “Previous studies identify that the marketing of technological innovation to SME owners/managers is a minefield of emotion, attitudes, behavioural intention and perceptions. Coupled with other factors considered important to owner/mangers such as cost and technical complexity, plus issues such as computer literacy of the owner/manger, and the size, sector and status of the firm, it would appear that marketers of mobile data technologies have many barriers to overcome.” This Australian study found that SMEs will typically go through three phases when determining whether to adopt IT:

§ Assessing IT benefits, organisational culture and firm-suited IT
§ Assessing internal resources and procedures
§ Evaluating external environment, support and services

Harker & Van Akkeren (2002) discuss how Australia’s adoption of e-commerce and related technologies is widely varied between states and even more so between regional and city-based firms. This, however, was found not to be the case with mobile technologies, with evidence showing a high adoption across all states and regions in Australia. “Mobile data technologies, which ‘marry’ mobile phones and e-commerce technologies, are seen as eliminating time and distance as barriers for regional businesses in their adoption of these technologies.” (Harker and Van Akkeren 2002)