An assessment of the impact of technology on the competitiveness of SMEs in the furniture manufacturing industry in Harare: case of Willowvale Industrial Area.

Abstract

The need for adoption of new technologies has been necessitated by the advent of globalisation and technological advancement which have resulted in growing competition in the market place which forces enterprises to refocus on their business strategies, especially on innovations, to sustain their competitive positions against competitors. SMEs struggle to compete with large corporates and imported products on quality and prices due to old production equipment and technologies. SMEs also fail to develop or reach new markets due to prohibitive market development costs because of expensive methods used to reach the markets. The objective of the study was to assess the impact of technology on competitiveness of SMEs in the furniture manufacturing industry in Willowvale Industrial Area, Harare. The research reviewed theories and empirical studies that explain the relationship between technology adoption and firm competitiveness. The reviewed theories guided the choice of the study topic, independent and dependent variables and development of the conceptual framework. The population of the study was SMEs owners in the furniture manufacturing industry in the Willowvale industrial area. Primary data was collected using questionnaires. Data analysis was done using Statistical Package for Social Sciences (“SPSS”) Version 23 and inferential statistics were used to test the relationship between technology and SME competitiveness. The study concluded that technology (information technology, process innovation and product innovation) has a significant positive effect on SME competitiveness. The study also came up with impediments or challenges faced by SMEs in adopting new technologies, benefits which accrue to SMEs from adoption of new technologies and made suggestions on how SMEs can be assisted to adopt new technologies since technology enhances their competitiveness. The study recommends that policy makers should formulate policies and programmes that facilitate adoption of new technologies by SMEs to maintain and or enhance their competitiveness for sustainability. The study also recommends that SMEs owners and managers should formulate strategies to adopt new technologies to enhance competitiveness. Lastly the study suggests areas for further research.