OPERATIONS MANAGEMENT AND SMES

Operations management and SMEs



Operations management and SMEs

Introduction

As new century is characterized by era of knowledge and information, these terminologies affect each and every aspect of our daily life as individuals. Obviously role of these concepts is stronger in business levels. So as to benefit from implication of knowledge, first and foremost one should determine various functions of it. Small-Medium size Enterprises, compose the large portion of today's businesses, thus, practical extension of such the concept to dipper stratums of SMEs is essential.

The deployment of IT within businesses has often resulted in replacement of old problems with new and expected business benefits of IT not realised. Despite increasing expenditure on IT, productivity has not increased and this has given rise to the 'productivity paradox'. The difficulties of identifying benefits have been discussed and it has been suggested that some businesses may not have received any According to David, there is often the time lag before benefits are achieved. In fact, his research has shown that productivity benefits begin to emerge once diffusion rate of technology in industry surpasses 50%. Brynjolfson and Hitt and Stirroh have also shown that it takes time for productivity benefits to be achieved. Stirroh noted that construction sector in US did not experience increases in productivity between 1995 and 1999; this industry sector lagged behind others in embracing IT. Like US, construction sector in Australia is the 'laggard' in terms of its productivity output and adoption of IT when compared to other sectors of economy. Considering this, we examined approaches used by construction small medium-sized enterprise (SME) to evaluate and justify their IT investments, etc.

The present paper looks into technology adoption decisions of small and medium enterprises (SMEs) in Greece. In particular, it aims to identify context-specific diffusion determinants for take-up of Internet. To this end, decision to purchase Internet-enabled personal computers (IEPCs) is modelled against the set of literature-suggested factors influencing diffusion plus influence of previous experiences with earlier forms of technology.

SMEs frequently operate in markets which present insufficient leverage for technical change. In Greece, majority of SMEs are to be found in industries characterised by narrow sectoral niches and geographic isolation (e.g. tourism, retail and wholesale trade, light manufacturing), where individual company-level benefits may not appear to justify technological adoption. Nevertheless, technological advancement affords long term industry and economy-wide opportunities for growth and competitiveness, even if they are not apparent at firm level.

The above assumption is central to rationale behind modern technology policy at regional, national, and supranational level in EU and beyond. Policy-oriented documents have repeated time and again importance of swift and even spread of innovation for European competitiveness and growth (CEC, 1995, OECD, 1997, Government, 1999 and GSRT, 2003). Numerous government sponsored schemes are aimed at promoting take-up of information technology (IT) in particular1 by providing financial support (either directly or through mediation instruments) and raising awareness.

If technology policy is to follow an interventionist route, then subsidies need to be attuned to context that calls for ...