Accelerating SME e-Business Adoption: Focus on Productivity &Profitability
2006
代写留学生电子商务论文The use of advanced information and communications (e-business) technologies (ICT) by smallfirms makes a strong contribution to their productivity and profitability. E-business is more thansimply selling products over the Internet. While the Internet does represent an importantadditional sales channel, this area is a relatively minor aspect of the overall e-businessphenomenon. Eighty to ninety percent of the benefits attributed to e-business are derived frombusiness-to-business transactions and from savings accrued by making internal businessprocesses more productive.In short, e-business, as discussed here, primarily is about making traditional businessrelationships and processes, such as recruitment, procurement, administration,marketing/selling and customer support (taken together these processes can be loosely termed‘overhead’), more efficient through innovative applications, technologies and processes. Byadopting and applying information technology and the e-business applications that run overnetworked technologies, businesses can reduce costs, increase profit and improve customersatisfaction. The government needs to place a greater emphasis on ICT usage to ensureCanada’s productivity and competitiveness in a global economy.SMEs represent a significant percentage of economic participation in Canada. Statistics Canadaestimated that of the 1,046,345 employer businesses known to exist in Canada in 2004, slightlyless than 3000 or about 0.3% have more than 500 employees. The vast majority of employerbusinesses (98%) have fewer than 100 employees, nearly 75% have fewer than 10 and 58%have only 1 to 4 employees. SMEs account for approximately 65 percent of total private sectoremployment and is growing by 15-25 per cent annually. In addition to the economic importanceof SMEs, this community must not be overlooked as a key social institution. With the majority ofCanadians employed by SMEs (in the private sector), this is where they are most oftenintroduced to, exposed to and trained with respect to new processes and technology. Hence,while promoting innovation and e-business adoption among SMEs is key to enhancingCanada’s productivity, it also represents an important vehicle to increasing social goals such astechnical literacy among the citizenry.Therefore, when Canada discusses the diffusion and application of innovation throughout theeconomy, SMEs represent the critical mass of businesses that must be targeted. In fact, moreCanadian SMEs claimed financial benefits from e-business adoption—both increase in revenueand decrease in cost of goods sold, and in sales, general and administrative expenses—thandid SMEs in the U.S. and the E.U. SMEs are increasingly cognizant of this trend, and look forthe bottom-line benefits of technology adoption. However, the high overall results for Canadamask the fact that adoption is uneven across firm size and sector. While small firms (fewer than100 employees) led their international counterparts in adoption rates for customer-focusedsolutions, and financial, accounting and procurement solutions, medium-sized firms (100 to 500employees) lagged internationally. Given this, the government should immediately take steps todevelop a national ICT strategy and establish a National Council on the E-economy to advanceICT in Canada, as recommended in the 2006 Telecommunications Policy Review (TPR) report.
This National Council would continue the good work that was undertaken by the Canadian e-
Business Initative (CeBi). CeBi was an important step forward for advancing Canada’s ICTawareness and it encouraged increased productivity, leadership and innovation in SMEs. Theimplementation of the National Council would lead to a national effort to provide benchmarking,insight and recommendations for Canadian e-business.
E-business adoption, including the type of solution, also varied by industry sector. While 71percent of firms in the financial services industry were using or adopting customer service andsupport e-business, this was true for only approximately 40 per cent of the manufacturingindustry and 63 per cent of the retail industry were using this tool. In addition, firms in the retailsector reported low usage of supply-chain management tools, as did those in manufacturing.
E-business Adoption by type and Sector
Manufact.
Financial
services
Wholesale/
Retail Trade
Com/
ISP
Public
sector
Customer Development & e-
Marketing 38.5 63.5 68.8 63.6 55.8
Customer Service & Support 40.4 71 62.5 54.2 68.2
E-Commerce (including B2B) 42.5 38.7 67.3 45.5 39.5
Finance & Accounting 35.8 58.1 33.3 35.7 51.2
Human Resources 13.5 25.8 16.7 43.6 37.2
Procurement & MRO 30.8 19.4 22.9 20 23.3
Sales Force Automation 25 30.2 34.7 25.5 9.3
Supply Chain Management 17.3 22.6 18.8 25.2 30.2
Corporate Portal 11.5 50.8 32.7 67.3 44.2
Source: Net Impact Study Canada, the SME Experience, 2002
SMEs report a number of reasons for such variable adoption, reasons that often include
qualitative judgments such as perceptions regarding the inapplicability of e-business solutions totheir sector. However, the high cost of the solution figures as a significant barrier for firmsacross /sectors. The Canadian Chamber suggests that, given that high effective tax rates oncapital for corporate investments affects capital investment decisions, building a competitivetaxing regime and accelerating the elimination of capital taxes, could aid firms in deciding tomake greater ICT investments.
Recommendations
That the federal government:
1. Take the lead to implement and establish an ICT adoption strategy and National Council onthe E-economy to better advance ICT adoption throughout all sectors of the economy.
2. Continue to work with the private sector, to accelerate e-business adoption among SMEs,recognizing the growth rate in this sector and the opportunity to focus on new companies,which research 代写留学生电子商务论文has shown have a higher penetration of e-business applications. Specificfocus should be placed on emphasizing the productivity and profitability potential of ‘ebusinesstransformation’ via sector-specific approaches
3. Create a conducive investment climate (including competitive business and personal taxes)that encourages foreign and domestic investment in Canadian e-business opportunities, ebusinesstransformation and the creation of new e-business ventures.