The Role of Information and Communication Technology on Profitability of Small and Medium Enterprises: Case of Nairobi City County
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Date
2023-11
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IAJAH
Abstract
Small businesses in Kenya have embraced
the application of technological advances in
communication and information to enhance
their performance and profitability in the
current challenging business environment.
This was particularly exacerbated by the
Covid-19 pandemic that forced them adopt to
the new technological advancements in order
to stay afloat. However, the effect of
technological innovation regarding the
profitability of premises is still understudied
in Kenya with reference to Kasarani subcounty in Nairobi County. The research
especially looks to investigate the impact of
data and conversation modern advances on
the success of minor and medium-sized
businesses in Nairobi City County.; to assess
the role of Information Communication
Technology on the quality of products and
services of Small and Medium Enterprises in
Kasarani Sub-County; and to determine the
duty of information and Communication
Technology on efficiency of Small and
Medium Enterprises in Nairobi City County.
The study is grounded on two theories, that is
the unified hypothesis of adoption and
utilization of modern advances theory and the
diffusion of technology hypothesis. The
research employed the methodology of an
informative study, for this study, it aimed
demography of owners and managers of all
registered Small and medium-sized
businesses with reference to Kasarani subcounty in Nairobi County, who total 2,136 as
per the Nairobi County Government. The
researcher computed the desired sample
using the Yamane equation to get the desired
sample size. This formula gives a sample size
of 96 owners/managers of businesses, from a
directory attributed to all licensed SMEs,
who will be chosen in Kasarani sub-county in
Nairobi County, by simple random sampling
technique. Primary data was used in this
investigation, which was quantitative in
nature and obtained using structured
questionnaires. Preliminary research was
conducted before the core investigation. The
test is performed to evaluate the precision and
dependability of the investigation's
equipment. Participants’ responses were
enumerated based on a five-point Likert
scale. The drop and pick technique were then
employed in questionnaire administration in
the main study, whereby respondents were
given a week to respond. After collection of
the data, the study assessed the
questionnaires for completeness after which
coding and entry of the data followed. Data
analysis was then conducted utilizing version
27 of the Statistical Processing System for the
Social Sciences. Both inferential and
descriptive analyses were utilized in this
regard. Results indicate that that information and Communication Technology and
profitability has a significant effect on SME
performance (β = .813, Sig. = .015<.05. In
conclusion, the findings highlight the
potential of information and communication
technology to drive financial gains elevate
product standards, streamline operations, and
emphasize the need for supportive policies
and practices to foster technology adoption
and enhance SME success.
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Citation
Waziri, T. S., Njoroge, J. (2023). The role of information and communication technology on profitability of small and medium enterprises: Case of Nairobi City County. International Academic Journal of Arts and Humanities, 1(3), 409-421.