Studying the effects of information and communication technology on the performance of small and medium sized enterprises in Iran

Abstract

Information and communication technology (ICT) in today's developing world, is on the assets and necessities for development and growth of companies, especially for small and medium sized enterprises (SMEs) which play an important role in the economy of each and every country and are capable of bringing about results like effectiveness, profitability, decreasing trading costs, better marketing and customer orientation. In this article, we have studied the effect of ICT investment and usage on the performance of small and medium sized enterprises in the selected districts using panel data method. The aforementioned enterprises were consisted of 10 to 49 staffed enterprises in those districts in the years of 1998–2009. Results show that ICT usage and investment have a positive effect on the performance of small and medium sized enterprises. Moreover, considering the results of our approximation, it is obvious that ICT investment has a lower profit ratio in short term as opposed to that of the other production factors.