Evaluation of Information Systems in Small and Medium Business in Southern Province of Sri Lanka

Abstract

Today, information processing is an essential activity for the success of business organization. Information has become essential to make decisions and is a crucial asset in organizations. An Information System is a technology required for information processing. The application of Information Systems technology in business organizations has opened up novel opportunities for running and managing them. The purpose of this study was to examine empirically the current status of adoption of Information Systems in the small and medium businesses in Southern province of Sri Lanka. A questionnaire based survey was conducted to collect data from 80 small and medium business organizations in Southern province of Sri Lanka covering all three Districts vitz. Galle, Matara, and Hambantota. Equations were developed to find the relationship of Operational, Management and Strategic level of Information Systems. Based on the Innovation - Diffusion Theory, the status of Digital Divide of the organizations was specified by means of Digital Divide Index of Information Systems. The results showed that these organizations have not become innovators, early-adopters or early - majority of adoption of Information Systems. Most organizations adopted Operational Level Information Systems; No Strategic Level Information Systems was observed. Moreover, organizations had a trend to use off the shelf Information System software rather than bespoke. The regression analysis highlighted that age and education level of managers or owners have a positive relationship with the adoption of Information Systems in their businesses.