ICT Usage, Bounded Rationality and Business Performance of SMEs in Sri Lanka

This study endeavours to investigate empirically how Information and Communications Technology (ICT) usage affects the bounded rationality and business performance of Small and Medium Enterprises (SMEs) in Sri Lanka. The data collection has been done with 400 owners of SMEs in Sri Lanka by employing...

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Bibliographic Details
Published inColombo business journal Vol. 12; no. 1; pp. 54 - 86
Main Authors Ranatunga, R. V. S. P. K., Priyanath, H. M. S., Megama, R. G. N.
Format Journal Article
LanguageEnglish
Published Faculty of Management & Finance, University of Colombo 29.06.2021
Subjects
bounded rationality
business performance
ict usage
small and medium scale enterprises
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Summary:This study endeavours to investigate empirically how Information and Communications Technology (ICT) usage affects the bounded rationality and business performance of Small and Medium Enterprises (SMEs) in Sri Lanka. The data collection has been done with 400 owners of SMEs in Sri Lanka by employing telephone and face to face interviews using a structured questionnaire. The Partial Least Squares-Structural Equation Modelling (PLS-SEM) was utilized to analyse the data. The empirical results discovered that the different dimensions of ICT usage such as infrastructure, applications, policy, human resources, and mobile technology have a negative impact on bounded rationality and positive effects on the business performance of SMEs in Sri Lanka. Thus, the study recognizes that several dimensions of ICT usage make proper information flow to pull out information asymmetry and reduce the bounded rationality of SMEs, thereby increasing the business performance of SMEs in Sri Lanka.
ISSN:1800-363X
2579-2210
DOI:10.4038/cbj.v12i1.71