Lazarus N. Nduati
Master of Science in Entrepreneurship
Jomo Kenyatta University of Agriculture and Technology

Dr. Kepha Ombui
Project Supervisor
Jomo Kenyatta University of Agriculture and Technology

Dr. Assumptah Kagiri
Project Supervisor
Jomo Kenyatta University of Agriculture and Technology

CITATION: Nduati, N. L., Ombui, K, & Kagiri, A. (2015). Factors Affecting ICT Adoption in Small and Medium Enterprises in Thika Town, Kenya. European Journal of Business Management 2 (3), 395-414

ABSTRACT

Entrepreneurship is increasingly recognized as an important driver of economic growth, productivity, innovation and employment, and it is widely accepted as a key aspect of economic dynamism. Transforming ideas into economic opportunities is the decisive issue of entrepreneurship. History shows that economic progress has been significantly advanced by pragmatic people who are entrepreneurial and innovative, able to exploit opportunities and willing to take risks (Hisrich, 2008). It makes sense therefore to conclude that, throughout the world entrepreneurship is the tap root from which Small and medium enterprises (SMEs) emerge, converting later to big enterprises in the world today. The rapid development of information and communication technologies (ICT) which changes the existing business structures and ways of communication extremely influence metamorphosis and the growth- spread of SMEs. It is known that the adoption and use of ICT represents fundamentals of competitiveness and economic growth for companies, organizations and even countries that are able to exploit them. (Steinfield, LaRose& Chew, 2012). Inevitably, the turbulent digital business environments in which small and medium-sized enterprises (SMEs) operate from necessitate SMES to adopt ICT in an effort to develop series of competitive activities required to generate a superior firm performance. ICT can play a very important role because it can help SMEs both create business opportunities and combat pressures from competition. Therefore Adoption of ICT can help SMEs cut costs by improving their internal processes, improving their product through faster communication with their customers. In retrospect, even with such information as indicated above, and the importance of ICT as an enabler to other sectors and to economic development having long been recognized, SMEs seem slow in its adoption and use as compared to other sectors. While there has been growth in ICT use by large enterprises to gain a competitive edge, there is little evidence of its adoption and use by SMEs which continue to be faced by limited access to information and markets.  As a result of this phenomenon, the study into deterrents of ICT adoption by SMEs is warranted.  
The study sought to investigate factors affecting the ICT adoption in small and medium enterprises in Thika Town, Kenya. The study adopted a descriptive research design where the population of interest in the SMEs was visited. This study employed stratified random sampling technique, the target population for the study being SMEs entrepreneurs within Thika town area. The specific objectives of the study was, to investigate the influence of cost on ICT adoption in small and medium enterprises in Thika town; to find out the influence of skills development on ICT adoption in small and medium enterprises in Thika town; to determine the influence of Infrastructure on ICT adoption in small and medium enterprises in Thika town and to establish the influence of administrative support on ICT adoption in small and medium enterprises in Thika Town. The researcher used a questionnaire as the primary data collection instrument. The questionnaire was designed to give a brief introduction and was divided into sections representing the various variables adopted for study. The questionnaire designed by the researcher based on the research questions, adopted pilot testing to refine the questions before the questionnaire could be administered to the selected sample. The findings were presented using tables with Likert scales being used to analyze the mean score and standard deviation. Percentages, tabulations, means and other measures of central tendencies were used to present the data. The study affirmed that, development of ICT was very important in the running of small and medium enterprises and that most traders in the area studied had basic level skills in ICT which according to the study acts as a lid in hindering adoption of ICT in business running processes. Cost of computer software and other ICT equipment, administrative support, managerial, high cost of network and Internet are factors that were found to have heavilly negated adoption of ICT into SMEs.

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