Page 1 of 10

Journal for Studies in Management and Planning

Available at

http://edupediapublications.org/journals/index.php/JSMaP/

e-ISSN: 2395-0463

Volume 02 Issue 11

November 2016

Available online:http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 30

Problems of ICT Adoption in Agro-Small and Medium Scale

Enterprises of Ibadan, Oyo State, Nigeria BY

JOSHUA Abolade Opeyemi, AJAYI Olaniyi Adewale and OLODUDE Dorcas Opeyemi

1. Department of Animal Science, University of Ibadan, Oyo State, Nigeria

2. Department of Educational Foundation and Management, Ekiti State University, Ado

Ekiti, Ekiti State, Nigeria

3. Department of Demography and Social Statistics,ObafemiAwolowo University,

Ile-Ife, Osun State, Nigeria

Corresponding Author E-mail:ajayiolaniyi13@gmail.com

Abstract

Information Communication Technology has become an indispensable tool for agro-small and

medium scale enterprises globally. It provides agro-small and medium scale enterprise with

valuable information, increase knowledge, improved performance, improved relations with

customers and suppliers, increase efficiency, reduce cost of production among others. However

despite the benefits of ICT to world business, the same adoption is not evident among Nigeria

agro-small and medium scale enterprises.This study reviews literature on ICT and agro-SMEs. It

also identifies Problems of ICT adoption in Nigerianagro-SMEs and suggestsameliorative

measures to make agro-SMEs in Ibadan, Oyo State, Nigeria reap its full benefits.

Morover, findings from literature review and oral interview indicated thatthere are many

problems to ICT adoption in agro-SMEs in Ibadan, Oyo State, Nigeria such aslack of capital,

cultural barrier, lack of infrastructural facilities, lack of support from the government, lack of

regulatory policies, institutional framework, electricity constraint, lack of support from banks,

cost of implementation, corruption,low level of education, lack of skills and training;

technological background among others.The study concluded that costs should be reduced by

government intervention in reducingcustoms and execise taxes on ICT, and there is need for the

owners to be educated throughawareness programs and workshops to encourage the full

utilization of ICT for them to experience agric-business growth and success.

Keyword: Benefits, Impediments, Information Communication Technology Small and

Medium Scale Enterprises, ICT Adoption.

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Journal for Studies in Management and Planning

Available at

http://edupediapublications.org/journals/index.php/JSMaP/

e-ISSN: 2395-0463

Volume 02 Issue 11

November 2016

Available online:http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 31

Introduction

Ashrafi and Murtaza(2005) state that

organization around the globe are now

utilizing ICT not just for cutting costs and

improving efficiency, but also for providing

better customer service. According to

Spanos et al. (2002), buyers and sellers are

able to share information and transfer goods

across national borders with the use of ICT,

which helps to increase access to global

supply chains.

The effective use of ICT remains at central

stage in facilitating the change growth of

enterprises. Many small and medium

enterprises (SMEs) consider enabler to their

development (Dixon et. al. 2002).Also, the

increasing awareness and appreciation that

ICTs impact on Educational development,

economy development through the

expansion and growth of Small and Medium

enterprises (SMEs) improvement in

governance, environmental monitoring,

health security and human rights promotion

to mention just a few has further brought

ICTs to the fore in development discourse.

The benefits arising from innovative

technological solutions, products and

services have therefore transformed and

opened up new avenues for SMEs and

government to work together to eradicate

poverty, promote sustainable human

development, accelerate economic growth

and facilitate integration of many countries

into the global economy (Usman, 2010). The

potential of The adoption of ICT is crucial to

Agro-SMEs as ICT has become a major

catalyst and enabler of organizational

change (Hazbo et al, 2008). However,

despite the benefits of ICT to world

business, the same adoption is not evident

among Nigeria agro-small and medium scale

enterprisesItis in respect of these

background problems that this study

reviews literature on ICT and agro-SMEs. It

also identifies benefits and impediments of

ICT adoption in Nigerian agro-SMEs and

suggests ameliorative measures to make

agro-SMEs in Ibadan, Oyo State, Nigeria

reap its full benefits.

Literature Review

Concept and Role of Agro-Small and

Medium Scale Enterprises (SMEs)

Agro-SMEs are located within the broader

group of agro-enterprises. They are defined

as

enterprises, activities, institutions and

relationships that take place off-farm and are

involved in

supply of farm inputs, storage, distribution,

processing and other value-adding

transformation

processes of food and other agro-based

products. Agro-SMEs are found in both

rural and urban

areas. They form a very heterogeneous

group with wide differences in skills,

technologies,

markets and social environments (Freeman

and Valle, 2003). Agro-SMEs are an

important category within the emerging

private sector, accounting for a largeshare of

firms and employment as well as

contributing to a significant share of the

total valueadded in agro-industries in

developing countries. Utilizing rudimentary

technologies with veryhigh transaction

costs, women and other entrepreneurs in the

informal sector operate many ofthese

enterprises. They provide excellent

opportunities for private sector-led growth

and will becritical in driving economic

growth and social development in many

developing countries (Freeman and Valle,

ibid). Agro- Small and Medium Enterprises,

(SMES) are very important to the

development of any economy. The

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Journal for Studies in Management and Planning

Available at

http://edupediapublications.org/journals/index.php/JSMaP/

e-ISSN: 2395-0463

Volume 02 Issue 11

November 2016

Available online:http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 32

important role of SMEs to the development

of the economy of any nation is

even more evident when the economies of

developing nations are considered. The

SMEs have

played very critical roles in the development

of many Asian countries and indeed the

AsianGholami et al. (2010) regard SMEs as

firms that have fewer employers and a lower

annual turnover and assets than large firms

such as multi-national companies. The

authors statethat in SMEs decision-making

is centralized and key decision such as ICT

adoption are made solely by high authority

individual in the firm such as this chief

executive officer or information system (IS)

manager.

However, there have been numerous reports

on SMEs lacking in resources, experience,

skills and knowledge often placing SMEs at

a disadvantage when competing with big

companies in a globalized world (Bell et al,

2014).Bruque and Moyano (2007) also

believedthat Agro-SMEs face greater risks

in ICT utilization thanother SMEs due to

fewerr resources and limited education

about information system.

Concept of Information Communication

Technology (ICT)

Ashrafi and Murtaza, (2008) refer to ICT as

any technology that enable communication

and electronic capturing, processing and

transmission of information. These

technologies include products and services

such as desktop computers, laptops, hand

held devices, wired or wireless internet

business productivity software such as text

editor and spread sheet, enterprise software,

data storage and security and so on.ICT

provides a quicker response to market needs

and allows more flexibility in product

designs, production, and equipment

delivery. ICT also opens more opportunities

for training and the re-training of existing

staff in the mastery of new and sophiscated

technologies.

Benefits of ICT Adoption to Agro-SMEs

in Nigeria

The benefits of utilization include increase

in profit, number of local clients, number of

international clients, better image, improved

product or service quality, cheaper

communication,

better customer management, new strategies,

new opportunities and overall lowering of

operational costs. The most common

benefits that the SMEs acknowledge to have

experienced

were a better image or recognition,

improved customer relations due to

improved means of

communication (email and text message)

and increase in number of local clients. In

the

contemporary business world, ICTs enhance

the competitiveness of business enterprises.

ICTs have enormously contributed to

improved knowledge management, access to

robust

business information, efficient

administration, control and accountability,

access to markets

and growth of SMEs in both developed and

developing economies. ICTs also contribute

to the

management of enterprise resources

economically and effectively (Ruvinga and

Munyaradzi,

2012). ICTs’ adoption improves information

and knowledge management in the firm,

reduces costs andincreases the speed of

transactions for both B2B and B2C

transactions. In addition, ICTs are effective

tools for improving external

communications and quality of services for

established and new customers (Folorunso,

2005).ICTs enable SMEs to have access to