msme sector in india - role of ict(stages of ict adoption) - part -26

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Role of ICT (Stages of ICT Adoption) MSME Sector in India Part 26

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Page 1: MSME Sector in India - Role of ICT(Stages of ICT Adoption) - Part -26

Role of ICT(Stages of ICT Adoption)

MSME Sector in India

Part 26

Page 2: MSME Sector in India - Role of ICT(Stages of ICT Adoption) - Part -26

Stages of ICT Adoption

In a qualitative research study supported by Ministry of MSME#, three business types emerged on the basis of their technology adoption: a) “tech non-adopters” b) “techaspirers” c) “moderate tech adopters” Currently a lot of our MSMEs were found to operate in low-medium awareness.

Page 3: MSME Sector in India - Role of ICT(Stages of ICT Adoption) - Part -26

Stages of ICT Adoption

The research also helped point out the importance of location and clusters in driving technology adoption. So while Punjab may be known for its entrepreneurship and favorable environments for business, the technology adoption here was not as healthy as Bangalore, which could be due in part to IT hubs present throughout its metropolitan region.

Page 4: MSME Sector in India - Role of ICT(Stages of ICT Adoption) - Part -26

Stages of ICT Adoption

Exhibit 17: Technology Awareness- Adoption Framework

Page 5: MSME Sector in India - Role of ICT(Stages of ICT Adoption) - Part -26

Stages of ICT Adoption

In a subsequent PwC report and ASM e-journal paper*, another such framework for technology adoption was used, which helped understand how a firm moves up the ladder of ICT embracing.

The first stage is about very basic adoption, limited to routine administration and record keeping activities. The IT applications at this stage may involve use of Word processing, spreadsheet, email, intranet etc. ICT’s contribution here is more around providing operational efficiencies.

Page 6: MSME Sector in India - Role of ICT(Stages of ICT Adoption) - Part -26

Stages of ICT Adoption

The second stage of adoption relates to computerization of selective functions. At this stage, there is no integration between functions as the individual IT applications automate individual functions. This may include coverage of Financial, Inventory Management, Payroll systems etc. The role of ICT here is around improving effectiveness of functions through standardization of common processes.

Page 7: MSME Sector in India - Role of ICT(Stages of ICT Adoption) - Part -26

Stages of ICT Adoption

The third stage of adoption intends to automate key functions and offer complete business integration. Thus, this stage marks use of an enterprise level resource planning application (ERP). The integrated ICT systems at this stage facilitate having a cross-functional perspective of the fundamental business processes.

Page 8: MSME Sector in India - Role of ICT(Stages of ICT Adoption) - Part -26

Stages of ICT Adoption

The fourth stage marks the maturity of ICT adoption. At this stage, the companies are integrated across the value chain and using IT innovatively, through adoption of DSS, e- commerce etc. The quality of delivery, innovation and service would have become more important at this stage than control and costs.

Page 9: MSME Sector in India - Role of ICT(Stages of ICT Adoption) - Part -26

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