Key Issues in Information Technology Adoption in Small Companies

The influence of small companies in the entire economy is increasing. Small companies employ more people than ever, and many more are starting their own businesses. Small companies sometimes act as incubators for future economic giants. Realizing the importance of new information technology (IT) small companies are increasingly investing in their information systems, encouraged also by declining cost of contemporary IT. They are replacing their existing manual systems or old legacy systems with new, more flexible and reliable systems, to run their daily operations. A general belief exists that this enhances the flexibility of small companies, although some investigations (e.g. Levy and Powell, 1998) indicated that IT increases the effectively and effectiveness of the business and strengthens a creative way of thinking, but does not improve their flexibility.