**4.3 Profile of the IT function**

Question 3 asked the respondents if they have a group of people dedicated to the IT function. The findings, as shown in **Table 5**, reveals that a large majority (82%) of the respondents have people who are dedicated for the IT function, while 18% do not have such people.

#### **4.4 IT strategy basic development methods**

The survey questioned the participants about their level of use and familiarity with IT strategy basic development methods. They were asked to respond to this question by encircling a number on a five-point scale where 1 means fully used, 2 means partly used, 3 means familiar and has indirect influence, 4 means familiar but not used, and 5 means unfamiliar. A summary of how the surveyed SMEs are


#### **Table 4.**

*Profile of organizations.*


**153**

*\* Azyabi [7].*

**Table 6.**

(SODA)

*Evaluating Information Technology Strategic Planning Process: Lesson Learnt from Bruneian…*

using and are familiar with the IT strategy basic development methods is shown in **Table 6**. From the table data, it is evident that none of the IT strategy basic development methods are fully or partially used by the participating SMEs. Only three IT strategy basic development methods have indirect influence on SMEs: critical success factors (mean score: 3.10), transaction cost (mean score: 3.13), and balanced scorecard (mean score: 3.28). SMEs are generally familiar with many IT strategy basic methods (e.g., customer resource life cycle, strategic opportunities framework, stages of growth models, 3D model of IS success, Porter's value chain, Porter's five competitive forces, soft systems methodology, Porter's generic strategies, Strategic Information Systems Grid, information intensity matrix, and sector information management grid); however, these methods have no effect on their IT strategy development, and finally SMEs are not familiar at all with such methods as Strategic Options Development and Analysis (SODA), MIT'90, and PESTEL. The mean of these development methods is above 4.00 but less than 4.50, which further

In order to find any difference between basic strategy development methods and organization size, statistical t-test was conducted and the results are presented in **Table 7**. The results further indicate that none of the IT strategy basic development method is used by the Bruneian SMEs either fully or partially even though the SMEs are familiar with these methods. A comparison was also made with the Australian study and results reveal that two of the basic strategy development methods such as critical success method and transaction cost are significant rather

**IT strategy development basic methods Mean rating Ranking Australian study\*** Critical success factors 3.10 1 3.00 Transaction cost 3.13 2 3.00 Balanced scorecard 3.28 3 3.39 Customer resource life cycle 3.34 4 3.85 Strategic opportunities framework 3.39 5 3.88 Stages of growth models 3.61 7 3.94 3D model of IS success 3.84 12 4.06 Porter's value chain 3.68 10 4.09 Porter's five competitive forces 3.60 6 4.15 Soft systems methodology 3.79 11 4.15 Porter's generic strategies 3.67 9 4.24 Strategic information systems grid 3.66 8 4.27 Information intensity matrix 3.85 13 4.27 Sector information management grid 3.81 14 4.27

MIT'90 4.33 17 4.69 PESTEL 4.25 16 4.72

4.22 15 4.59

*DOI: http://dx.doi.org/10.5772/intechopen.84449*

indicate the marginal familiarization of these methods.

than the balanced scorecard.

Strategic Options Development and Analysis

*Results of IT strategy development basic methods.*

**Table 5.** *Profile of IT function.*

#### *Evaluating Information Technology Strategic Planning Process: Lesson Learnt from Bruneian… DOI: http://dx.doi.org/10.5772/intechopen.84449*

using and are familiar with the IT strategy basic development methods is shown in **Table 6**. From the table data, it is evident that none of the IT strategy basic development methods are fully or partially used by the participating SMEs. Only three IT strategy basic development methods have indirect influence on SMEs: critical success factors (mean score: 3.10), transaction cost (mean score: 3.13), and balanced scorecard (mean score: 3.28). SMEs are generally familiar with many IT strategy basic methods (e.g., customer resource life cycle, strategic opportunities framework, stages of growth models, 3D model of IS success, Porter's value chain, Porter's five competitive forces, soft systems methodology, Porter's generic strategies, Strategic Information Systems Grid, information intensity matrix, and sector information management grid); however, these methods have no effect on their IT strategy development, and finally SMEs are not familiar at all with such methods as Strategic Options Development and Analysis (SODA), MIT'90, and PESTEL. The mean of these development methods is above 4.00 but less than 4.50, which further indicate the marginal familiarization of these methods.

In order to find any difference between basic strategy development methods and organization size, statistical t-test was conducted and the results are presented in **Table 7**. The results further indicate that none of the IT strategy basic development method is used by the Bruneian SMEs either fully or partially even though the SMEs are familiar with these methods. A comparison was also made with the Australian study and results reveal that two of the basic strategy development methods such as critical success method and transaction cost are significant rather than the balanced scorecard.


#### **Table 6.**

**Frequency Percentage**

*Strategy and Behaviors in the Digital Economy*

Years of operation

Industry segment

Number of employees

Approximate sales

**Organization characteristics Frequency Percent**

Less than a year 4 6.0 –5 years 18 27.0 5–10 years 16 24.0 Over 10 years 29 43.7

Manufacturing 8 12.0 Service 21 31.3 Construction 2 3.0 Retail 4 6.0 ICT 20 30.0 Other 12 18.0

Less than 10 14 21.0 11–50 23 34.0 51–250 30 45.0

< \$100,000 9 13.4 \$100 K to < \$250 K 19 28.3 \$250 K to < \$500 K 18 12.0 \$500 K to < \$ 1 million 7 10.4 More than 1 million 9 13.4 No answer 15 22.0

**152**

**Table 5.**

**Table 4.**

*Profile of organizations.*

*Profile of IT function.*

People responsible for IT function

People responsible for IT decision-making process

No 12 18.0 1–5 23 34.0 6–10 18 27.0 More than 10 14 21.0

None 32 48.0 1–5 22 33.0 6–10 7 10.0 More than 10 6 9.0

*Results of IT strategy development basic methods.*


#### **Table 7.**

*T-test results of the use of the IT strategy basic methods based on organization size.*


*Significant at 95% confidence level.*

*Manuf: Manufacturing; Non-manuf: Non-manufacturing.*

#### **Table 8.**

*T-test results of the use of the IT strategy basic methods based on industry sector.*

Another comparison was made to explore the differences between industry sectors regarding the same three IT/IS strategy methods. The responding SMEs were divided into two main industry sectors: manufacturing and non-manufacturing. The results (presented in **Table 8**) reveal that there are no significant differences between these two industry sectors regarding the use of three IT/IS strategy basic methods.

#### **5. Discussion**

The findings indicate that none of the IT strategy basic development methods are used by the Bruneian SMEs either fully or partially, even though they are familiar with most of these methods. One qualitative question asked respondents to add any further comments about IT strategy development in SMEs. Some of them mentioned that these methods are well recognized in academic field but are not known in the SME context under these terms and names. Furthermore, some respondents reported that these methods could be more applicable for large organizations rather

**155**

**6. Lesson learnt**

*Evaluating Information Technology Strategic Planning Process: Lesson Learnt from Bruneian…*

Bruneian and Australian SMEs on the basis of industry sector.

This pioneering study conducted among Bruneian SMEs has met both of its objectives. As mentioned in the introduction, the main objectives of this study were to investigate the extent to which Bruneian SMEs use or are familiar with the basic IT strategy basic development methods. Regarding the first objective on the use of the IT strategy development methods, it was found that none of the provided basic IT strategy development methods is used by these surveyed SMEs either fully or partially; only three methods have indirect influence on IT strategy development in these SMEs: critical success factors, transaction cost, and balanced scorecard. Nevertheless, these surveyed SMEs are not familiar with SODA, MIT'90, and PESTEL, and surveyed SMEs are familiar with other strategy development methods, but these methods had no effect on their IT strategic development. Moreover, no statistical difference was found with the familiarization with the basic IT strategy development methods on the basis of organization size and industry sector that conclude our second objective. In the practice side, this research assists SMEs in recognizing the importance of IT strategy for SMEs, and it therefore provides an insight of IT strategy development in SMEs. The study further found some similarities in the use of basic IT strategy development methods with Australian SMEs on the basis of industry sector; however, on the basis of organization size, the results are in contrast, and it is because of the more developed business practices of Australian SMEs.

The study findings further provide insight in building up an empirical foundation for understanding the organizational use of IT strategy basic methods, among Bruneian SMEs within the Southeast Asian context. The basic question that needs an immediate attention is from the policy planners that are to find out the reasons why these SMEs are not utilizing the basic IT strategy development methods

than SMEs. These reasons may help explain to some extent the absence of the use of these methods among the surveyed SMEs. The results support the study of Majama et al. [60] who found that strategic planning efforts among SMEs in Botswana do exist but to a limited extent. The comparison with Australian study was made to find out the difference between the two categories of organization size regarding the three methods which have indirect influence on SMEs' IT strategy development (i.e., critical success factors, transaction cost, and balanced scorecard). The results of student t-test (in **Table 7**) indicate that small organizations (with less than 50 employees) are less influenced by and are less familiar with the transaction cost and critical success factors than medium-sized organizations (with more than 50 employees). On the other hand, no such significant difference can be observed between these two groups of SMEs toward balanced scorecard. The results partially support Blili and Raymond [6], Boynton and Zmud [68], and Levy and Powell [62]. As far as the use of the IT/IS strategy basic development methods are concerned, our results are consistent with the Australian study [7] that further indicated that none of the IT/IS strategy basic development methods are fully or partially used by the participating SMEs. However, on the basis of industry sector and organization size (**Table 8**), our findings are in contrast with the study (ibid) as on these bases IT/IS strategy basic development methods remained insignificant. This might be due to the business dynamics and business practices of the Bruneian business environment which is less competitive, in practice, and/or lack of top management initiative. In addition, Bruneian SMEs are not struggling for their survival solely on IT [69] and are less influenced by the basic strategy development methods compared to Australian counterpart. However, no such difference is significant between

*DOI: http://dx.doi.org/10.5772/intechopen.84449*

*Evaluating Information Technology Strategic Planning Process: Lesson Learnt from Bruneian… DOI: http://dx.doi.org/10.5772/intechopen.84449*

than SMEs. These reasons may help explain to some extent the absence of the use of these methods among the surveyed SMEs. The results support the study of Majama et al. [60] who found that strategic planning efforts among SMEs in Botswana do exist but to a limited extent. The comparison with Australian study was made to find out the difference between the two categories of organization size regarding the three methods which have indirect influence on SMEs' IT strategy development (i.e., critical success factors, transaction cost, and balanced scorecard). The results of student t-test (in **Table 7**) indicate that small organizations (with less than 50 employees) are less influenced by and are less familiar with the transaction cost and critical success factors than medium-sized organizations (with more than 50 employees). On the other hand, no such significant difference can be observed between these two groups of SMEs toward balanced scorecard. The results partially support Blili and Raymond [6], Boynton and Zmud [68], and Levy and Powell [62]. As far as the use of the IT/IS strategy basic development methods are concerned, our results are consistent with the Australian study [7] that further indicated that none of the IT/IS strategy basic development methods are fully or partially used by the participating SMEs. However, on the basis of industry sector and organization size (**Table 8**), our findings are in contrast with the study (ibid) as on these bases IT/IS strategy basic development methods remained insignificant. This might be due to the business dynamics and business practices of the Bruneian business environment which is less competitive, in practice, and/or lack of top management initiative. In addition, Bruneian SMEs are not struggling for their survival solely on IT [69] and are less influenced by the basic strategy development methods compared to Australian counterpart. However, no such difference is significant between Bruneian and Australian SMEs on the basis of industry sector.

### **6. Lesson learnt**

*Strategy and Behaviors in the Digital Economy*

**Organization size**

50 3.11

50 3.14

50 3.47

**Industry sector**

> Nonmanuf

> Manuf Nonmanuf

> Nonmanuf

*Manuf: Manufacturing; Non-manuf: Non-manufacturing.*

3.16

3.06

3.06

*T-test results of the use of the IT strategy basic methods based on organization size.*

3.25 3.23

3.75 3.06

3.25 3.75

*T-test results of the use of the IT strategy basic methods based on industry sector.*

**IT strategy basic development methods**

Transaction cost

Critical success factors

Balanced scorecard

**IT strategy basic development methods**

Critical success factors

*Significant at 95% confidence level.*

Transaction cost Manuf

Balanced scorecard Manuf

*Significant at 95% confidence level.*

*\**

*\**

**Table 8.**

**Table 7.**

Another comparison was made to explore the differences between industry sectors regarding the same three IT/IS strategy methods. The responding SMEs were divided into two main industry sectors: manufacturing and non-manufacturing. The results (presented in **Table 8**) reveal that there are no significant differences between these two industry sectors regarding the use of three IT/IS strategy basic methods.

**T-test for equality of means**

> **(2 tailed)**

1.862 −.169 65 0.867 Non-sig Significant

0.993 0.242 65 0.809 Non-sig Significant

4.65 1.456 65 0.150 Non-sig Non-sig

**Means F T df Sig. (2 tailed) Remark**

3.39 −0.197 65 0.845 Non-sig

0.603 −1.071 65 0.288 Non-sig

0.435 −0.833 65 0.408 Non-sig

**Remark Australian** 

**T-test for equality of means**

**study**

**Means F T df Sig.** 

The findings indicate that none of the IT strategy basic development methods are used by the Bruneian SMEs either fully or partially, even though they are familiar with most of these methods. One qualitative question asked respondents to add any further comments about IT strategy development in SMEs. Some of them mentioned that these methods are well recognized in academic field but are not known in the SME context under these terms and names. Furthermore, some respondents reported that these methods could be more applicable for large organizations rather

**154**

**5. Discussion**

This pioneering study conducted among Bruneian SMEs has met both of its objectives. As mentioned in the introduction, the main objectives of this study were to investigate the extent to which Bruneian SMEs use or are familiar with the basic IT strategy basic development methods. Regarding the first objective on the use of the IT strategy development methods, it was found that none of the provided basic IT strategy development methods is used by these surveyed SMEs either fully or partially; only three methods have indirect influence on IT strategy development in these SMEs: critical success factors, transaction cost, and balanced scorecard. Nevertheless, these surveyed SMEs are not familiar with SODA, MIT'90, and PESTEL, and surveyed SMEs are familiar with other strategy development methods, but these methods had no effect on their IT strategic development. Moreover, no statistical difference was found with the familiarization with the basic IT strategy development methods on the basis of organization size and industry sector that conclude our second objective. In the practice side, this research assists SMEs in recognizing the importance of IT strategy for SMEs, and it therefore provides an insight of IT strategy development in SMEs. The study further found some similarities in the use of basic IT strategy development methods with Australian SMEs on the basis of industry sector; however, on the basis of organization size, the results are in contrast, and it is because of the more developed business practices of Australian SMEs.

The study findings further provide insight in building up an empirical foundation for understanding the organizational use of IT strategy basic methods, among Bruneian SMEs within the Southeast Asian context. The basic question that needs an immediate attention is from the policy planners that are to find out the reasons why these SMEs are not utilizing the basic IT strategy development methods

especially when they are aware of the benefits of the strategic process. The plausible reason is that Bruneian business environments do not demand the competitive advantage. This was also supported by one of the studies on e-commerce adoption among Bruneian SMEs and had further concluded that Bruneian businesses need to develop a business culture where competitive advantage could be achieved through e-commerce adoption [19]. To deal with the severity of this problem, the CEO of these SMEs along with the policy makers of Bruneian Small and Medium Business Development Authority (SMBDA), with the help of the Ministry of Industry and Primary Resources (MIPR), should address this issue accordingly. We believe that there are some success stories among small businesses, and the planning agencies could further organize a forum where other small businesses can learn from the best practices. We also believe that until or unless the stated barriers were not curtailed or reduced, these SMEs would not be gaining.

As mentioned, one of the biggest constraints faced by theses SMEs with regard to the SISP emerged from lack of owner's awareness, their reactive behavior, and lack of formal employees' participation in business decisions. This can further be improved by either educating the owners' IT skills and abilities or by employing a formal manager-IT support. This can be possibly implemented by the intervening e-government initiative by e-Government National Centre (EGNC). Once the owners are educated and started developing SISP, these SMEs would increase competitiveness, reduce cost, and share knowledge with the members and stakeholders; the overall business processes would finally be improved to get the business, otherwise outside competitive forces will reshape the local business SMEs.

Like every research this study is not free from its weaknesses and limitations. Properly addressing these limitations in the forthcoming researches could improve the findings. Firstly, the small sample size has been a major impediment especially generalizing the results across the region. Secondly, the small contribution of the manufacturing sector among these surveyed SMEs because of the absence of very large share of this sector in Bruneian business has made the sample size bias in nature which is apparently beyond the control of the researchers. Thirdly, the study needs to include barriers of not doing the SISP to highlight the various reasons that need to be addressed by the relevant authorities Finally, most of the items in the questionnaire are self-reported and would further induce response bias, and we did not do any precautions to address this issue. So caution should be used is generalizing the results. We therefore recommend that future studies would address this issue accordingly.
