10 - Strategic IS dynamics

Abstract

This chapter uses the focus-dominance model to review evidence for the two trajectories of successful small- and medium-sized enterprises (SMEs). In one, the customer base increases and the information systems strategy changes from a focus on efficiency to one on co-ordination and information systems (IS) investment in local area networks (LANs) and databases. In the other trajectory, the customer base does not increase significantly but collaboration between the firm and its few major customers improves, supported by IS investments in inter-organizational systems, such as electronic data interchange (EDI). SME growth is actually achieved by a combination of the characteristics of the entrepreneur, the firm, and its context. In terms of the entrepreneur, clear business goals and management experience stand out as essential. In respect of strategy, market positioning, financial resources, and devolution of decision-making are important. Unless these are executed effective growth will be inhibited. They all must be executed well individually and must be aligned with each other to ensure SMEs' growth.