Computer Usage in the Small Business Environment: A Trend Analysis

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ABSTRACT

This study is a trend analysis to investigate how computer utilization in small business has changed since the original study was conducted in 1992. Specifically, the investigation is concerned with how small business owners / managers are further using computer systems and application software packages in long-range and operational planning.

INTRODUCTION

Management Information Systems (MlS)monitor and control the business and predict future performance. An MIS, if properly used, can aid the small business owner in both long-range and operational planning, which are vital to the organization's success rate. Technology is advancing so rapidly that in order to "keep up" with the competition, small businesses are investing additional personnel and capital in computer systems. The advent of low-cost/high-performance microcomputers, coupled with relatively easy-to-use business applications software, has allowed an increasing number of small organizations to implement computer-based systems in their day-today operations. Networking of computer systems over a wide area or local area has enabled small business owners to share informational or hardware resources, to which they may not have access.

The success of small businesses is crucial to the stability of the U.S. economy (Amer & Bain, 1990). In the last decade, the introduction of microcomputers has made a tremendous impact on the capabilities of small businesses to operate efficiently and to increase the probability of enhancing the decision-making process through information systems. Effective long-range planning proves to be vital in view of a failure rate of about 70 percent (Amer & Bain, 1990) for small businesses each year. In recent field studies of small businesses of less than 50 employees (Chen, 1993; Schleich, et al., 1991), over half of the firms were utilizing computer systems in day-to-day operations. This phenomenon has led to an examination of computer usage and satisfaction of various variables related to computerized business systems. Schleich (1991) indicated that despite the great potential of microcomputers, it is estimated that only one-third of the microcomputers sold are being used for the functions for which they were originally purchased.

METHODOLOGY

The sample was drawn from the same population as the original study (Selby & Li, 1993). As in the original study, the population was stratified using the industry type as the variable, in order to improve the representation. The sample data was collected through a mail questionnaire administered to a systematic sample of 200 small businesses. The questionnaire addressed issues such as demographic information, computer brands, software usage, local area network usage and satisfaction, and various computer system satisfaction questions.

The sample was drawn from a population of 1,400 small businesses, which made up 85 percent of small businesses meeting the following criteria: (1) no more than 50 employees and (2) annual sales of $5 million or less. The industries sampled included: manufacturing, construction, retail, wholesale, business and professional/financial services. The education sector was withheld from the study. With 27 percent of the questionnaires returned, the results were analyzed using SAS.

RESEARCH HYPOTHESES

The following hypotheses pertain to the degree of insignificance between the various variables compared with the computer satisfaction constructs. A two-tailed T-test with the population assumed normal or approximately normal was used to test the hypotheses. The population standard deviation is tacitly assumed unknown, because this is usually the case. A 0.10 alpha level of significance was used, as was in the original study.

Research hypothesis 1: There is no significant difference in the mean responses between industries relative to the various satisfaction constructs.

Research hypothesis 2: There is no significant difference in the mean responses based on length of service of a business relative to the various satisfaction constructs. …