EJISDC (2000), 2, 7, 1-17

An Empirical Investigation of Use of Information Technology among Small

and Medium Business Organizations: A Bruneian Scenario

Afzaal H. Seyal*
Md. Mahbubur Rahim
Mohd. Noah A. Rahman
Department of Computing & Information Systems,
Institut Teknologi Brunei (ITB),
Jalan Tungku Link, Gadong BE 1410,
Bandar Seri Begawan, Brunei Darussalam.
Fax: 673-2-249036
*e-mail: ahseyal@brunet.bn
Abstract
In the last two decades issues regarding management of Information Technology (IT) within
organizations have gained due consideration. The heavy reliance on IT has caused difficulties
for chief executives officers (CEOs) to optimize their computing resources. A survey of
fifty- four small and medium sized organizations was conducted to investigate the degree of
IT usage in Brunei Darussalam. The study attempts to assess the depth and breadth of IT
usage in business. The parameters such as organizational (size, sale or profitability and type
of business) and chief executives (educational level and computer literacy, ownership of PC
and computer experience) are studied. The study highlights how sales figures of the
organizations; type of business and CEO computer literacy contributes toward the use of IT.
None of the other variables were found to be significant.
Keywords: Information Technology, Microcomputer adoption, Management Information,
Small and Medium Business organizations
Introduction
Information Technology (IT) plays a vital role in the sustained growth of business
organizations. The term IT is defined in a broad sense as technologies dedicated to
information storage, processing, and communications (Ang et al 1997). This notion of IT
focuses on a combination of hardware, software, telecommunications, and office equip ment
that transform raw data into useful information for speedy retrieval. Increasing investment in
IT and the strategic role played by information systems make IT implementation as an
important research issue within the MIS discipline (Bostrom and Heinen, 1977). While the
strategic importance of IT is established and progress has been made in understanding it, less
is known about how to implement IT effectively for achieving general organizational goals.
Much research, especially in the MIS discipline, has been undertaken to develop a better
understanding of IT implementation in improving organizational efficiency and effectiveness
mainly in the context of small to medium business organizations. As such the size of business
in these organizations is smaller in magnitude. It is sometimes known as having centralized
structure and is often resource poor in terms of human, financial and material resources
with less control of external factors (Lesjak, 1995). However, in the absence of a precise
definition, small and medium organizations are defined in different context in various
business cultures. For example, organization having less than 200 employees in USA is
known as small (Palvi et al 1994). In Singapore and Hong Kong, those with less than 50
employees were included in the definition of small organizations (Yap et al 1992). By
The Electronic Journal on Information Systems in Developing Countries,
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EJISDC (2000), 2, 7, 1-17

contrast, in Greece, staff of less than 100 was considered as small (Doukidis, 1994). Some
studies in small business computing fail to define what constitutes smallness in firm size
(Montazemi, 1988). It is however, true for medium sized organizations, where the number of
employees varies to what constitutes medium size organizations. In this study, we have used,
for the sake of simplicity, the size of greater than 50 employees to less than 250 employees,
as medium size organizations whereas, size of less than 50 employees is treated as small
organization. Although these organizations are smaller in size they are nevertheless highly
dependent on computer technology in promoting their business (Lesjak, 1995).
A formidable body of literature exists on the usage, adoption, and implementation of
IT. Several other researches shed lights on the success factors of IT along with main issues
concerning IT. Additionally, some studies have developed Users Satisfaction Model and
conducted empirical studies in measuring construct (Delone, 1988) in IT. None of the
existing literature, to the best of our knowledge has studied the use of IT in the broader sense
as defined by Ang & Koh (1997). Most of the existing studies have focused on
microcomputer usage and few has tackled the IS usage. Most of these studies were conducted
in early 1980s in the western countries and in the United States. Tan (1997) has used the
term matured leopard for the vario us countries of Asia-Pacific comprising Australia, Japan
and New Zealand. Growing tigers was used for countries comprising Hong Kong,
Singapore, South Korea and Taiwan. The developing economies were termed as young
lions comprising China, Malaysia Brunei, Philippines, Thailand and Vietnam. The pursuit of
IT in various regional countries is rather diversified and use of IT also varies tremendously
within these countries. (op cit). Comparatively, very little has been researched in the
countries referred to young lions. Thus the result of these studies might not be applicable to
Brunei Darussalam that is not only smaller in size but also different culturally. Keeping in
view the tremendous benefits of using IT in the business organizations, a pilot study was
conducted in early 1998 among the selected business organizations in Brunei Darussalam.
Brunei Darussalam is a small sultanate located on the northwest coast of Borneo with a total
population of nearly 0.3 million. Its main economic activity is dominated by the oil and gas
sector, and gross domestic product per capita is B$ 23,865 (US$1= B$1.68) (Brunei
Darussalam Year Book, 1994). After achieving its independence in 1984, the government has
recognized the need for broader use of computer technology in the public sector. The heavy
reliance of public sector organizations on IT has created IT awareness and established
technologically oriented culture among the business entities. More and more private sector
organizations have started getting the benefits of IT in their daily business.
The results of a pilot study were very effective in determining the usage of IT. That
has led us to undertake an empirical study in October 1998 to examine the practice of IT
usage among business organizations with a broader perspective. This paper presents the
findings of this study.
Objectives of Study
The central theme of this study is to examine the extent of the use of IT in various small and
medium business organizations working in Brunei Darussalam. This has been achieved
through conducting a pilot study by formulating the following two specific objectives:
(a)
(b)

To identify and to assess the extent of the use of IT in organizations

To identify the factors that may influence IT use in the organization.

EJISDC (2000), 2, 7, 1-17

A Review of Litera ture

The extent of use of information technology is actually related to the computing environment.
Computing environment is normally classified into two broad categories: the traditional data
processing (DP) and end- user computing (EUC). In the DP environment the user interacts
with the computer indirectly through professionally trained staff. On the other hand, in EUC,
the user interacts directly with the computer through application software (Palvi et al 1994).
In EUC, the user is supported by professio nal consultants, a vendor support program or
through education/training firms who act as intermediaries between the computer and the
user.
A wealth of studies has been contributed to both of these computing categories.
However, for the simplicity, we review what has been written about the EUC. The main
reason for selecting the EUC is characterized by the control that user have over choice as to
when and how to use a computer (Rockart and Flannery, 1983) (Kasper and Cerveny, 1980).
Moreover, EUC has grown rapidly within last twenty years. It is estimated that annual EUC
growth rate of 50% to 90% (Rockart & Flannery). With this increase use of EUC among
business organizations, it would be quiet appropriate to study on EUC environment. The
subject was discussed in various previous studies from different perspective considering
several approaches, such as microcomputer adoption, user satisfaction, determinant of factors
relating to the success of computer and impact of various organizational variables in the use
and also in the success of EUC. Table 1 highlights the various factors and variables that have
been studied by various researchers in the use of IT. Further studies have suggested the
different segments of business organizations have different level of IT usage. Raymond
(1982) reported that the concentration of IT in big organizations was more on supporting
managerial functions, whereas, in small organizations the concentration on IT was more on
operational functions.
In the Asia-Pacific region Valida et al. (1994) studied the IT utilization among 230
business organizations in Malaysia. They concluded that the use of IT in Malaysian
organizations was strategic in order to gain competitive advantage. Thong and Yap (1995)
developed an IT adoption model fo r small businesses. They concluded that small businesses
that had innovative CEOs possessed more positive attitudes toward IT adoption. Another
study at Singapore by Ang & Koh (1997) explored the relationship between user information
satisfaction and job satisfaction by developing two constructs to measure the relationship and
found to be correlated. In Hong Kong, Burn (1990) studied the strategic use of IT in Hong
Kong small and medium sized organizations. She surveyed three medium sized organizations
and found that IT strategy was related to Porter and Miller (1983) model of competitive
advantage.
In Australia Sohal et al (1998) studied the role and impact of IT in 530 Australian
Business Organizations and found IT usage was positively related to organizational
performance. On the other hand, Fink (1998) studied 280 Australian small and medium
business organizations and identified ten IT adoption factors in the business firms. Table 1
lists the important factors studied by various researchers facilitating IT usage in business
firms (Fink, 1998).

EJISDC (2000), 2, 7, 1-17

Authors
Yap et al., (1992)

Cragg & King (1993)

Iacovou et al., (1995)
Thong & Yap (1995)
Ang & Koh (1997)

Factors Studied
Consultant Effectiveness, Vendor Support
IS Experience, Financial Resources
CEO Support, User Participation
Relative Advantage, Competitive Pressure
Consultant Support, Managerial Enthusiasm
Organizational Readiness
External Pressure to Adopt, Perceived Benefit
Organizational Size, CEO Attitude to IT
CEO Innovativness, CEO Knowledge of IT
Age, Education, Organizational Level
Frequency of Computer Use, Computer literacy
and User training

Table 1

Research Model
Relevant literature was reviewed in order to develop a model and to propose various
hypotheses based upon it. For this study we have decided to develop a one-stage model
(Figure 1) relating to various variables for this study. As more experience is gained this
model can be refined. Each of the variables used is discussed below.
Organizational Parameters
The role of the organizational parameters such as size, structure, profitability was
considered as vital in the microcomputer usage. As pointed out in the introduction, several
researchers have discussed this variable from different perspective from adoption of
microcomputers, use of PCs, to studying end- user satisfaction. Lind et al (1989) concluded
that size and structure of the organization had a significant impact in the adoption of
microcomputer. Ein- Dor & Segev (1978) correlated the size and age of the business with the
use of microcomputer.
The larger, an organization, the more likely and extensive was such use. Raymond and
Megnenet (1982) went one step further and studied this variable with the end- user
satisfaction. He did not find any significant association between organizational size (no of
employees) and end-user level of satisfaction. This may be due to reason that he has
measured organization size based upon number of employees whereas Ein-Dor & Segev (op
cit) measured on the basis of annual sales turnover.

EJISDC (2000), 2, 7, 1-17

CEO
PARAMETERS

Ownership of PC

Computer Literacy
1*, 2*, 3*, 4*

Educational Level

Computer
Experience

H2(a) - H2(d)
Size of Organization

H1(a) - H1(c)
IT
USAGE

Type of Business

Profitability or Sales
of Organization

ORGANIZATIONAL
PARAMETERS

Note:
1* - in-house computer training
2* - outside computer training
3* - self-taught computer skill
4* - computer education

Figure 1 Showing Normative Model of IT Use

However, Gremillion (1994) found little significant in the relationship between the
size of organization and use of microcomputer. Lind et al (1989) studied the size of the
organization that was viewed as a predictor of the adoption of administrative, innovation, and
information system use. Similarly, type of business was found to be relevant in various
studies. Galbraith (1973) concentrated on the processes through which the informationprocessing environment influences a business action. The businesses in different sectors
have different information processing needs and those in more information intensive sectors
are more likely to use IT than those in less information intensive sectors (Yap et al 1992).
Valida et al (1994) in their study of Malaysian business organizations also support the
findings. They concluded that IT usage and integration were higher among organizations
involved in providing goods and/or services comparative to manufacturing and distribution.
It is also noticed that greater the information intensity, the greater the potent ial for
strategic use of IT in a business (Porter and Miller, 1985). Currie (1996) also suggested that
business types have considerable influence on the structure of IS activities of the
organization. Premkumar (1992) claimed that financial sectors organizations have greater

EJISDC (2000), 2, 7, 1-17

stake in IS use. Rahim et al. (1998) in his Brunei based study found the positive relationship
between the type of business sector and use of IS methods. It is evident from the previous
studies that organizational parameters were given due consideration but in different contexts
such as microcomputer use and IS use. However, keeping in line with these studies and to
find out the relevancy of these variables we have used the same organizational parameter to
study the current practice of IT in our study. Based upon the relevant research that supports
our model, the following hypotheses are postulated.
H1 (a) Size of business exerts a positive effect on the organizational use of IT.
H1 (b) Type of business exerts a positive effect on the organizational use of IT.
H1 (c) Sale of business exerts a positive effect on the organizational use of IT.
Chief Executives Parameters
The demographic variables are the most widely studied factors (Fuerst & Cheney, 1982). The
variables include age, education, organizational level and ownership of computer. Of these
variables, organizational position is perhaps the most researched one because of its relative
importance in organization theory. The success of IT within an organization can exert an
impact on power relations and decision -making processes (Ang and Pavri, 1994). That is
why various researchers (Thong and Yap, 1995) (Ang & Koh, 1997) under the umbrella of
end-users computer literacy and users training have most commonly investigated Chief
Executive Officers (CEO) parameters. Thong and Yap supported that end-users with
computer experience are more at ease in participating in computer based information
systems. A study by Montazemi (1988) indicates that the level of an end-users computer
literacy correlates with the users participation in the systems development process. Effective
organizational support and comprehensive user education are dominant concerns when
introducing end-users computing (Henderson & Treacey, 1993). It is widely acknowledged
that appropriate end-user training is critical to implementing IT in general, and to promote the
productive use of information systems in particular. Howard & Mendelow (1991) reported an
increase in the use of computers with computer training. Rockart and Flannery (1983) noted
that the user education is important and that different types of users need different types of
training. Igbaria & Nachman (1990) contended that prior computer background is essential in
promoting end-user satisfaction. Montazemi (1988) found end-user computer literacy
positively correlated with user satisfaction in context of small business environments.
In another study by Delone (1988), several end-user success factors were studied that
included the level of computer literacy and further associated positively the end- user
satisfaction with his level of computer literacy. Delone, however, has defined computer
literacy in term of computer experience through training or prior use and concluded that
CEOs knowledge of computers and involvement in computerization leads to more successful
computer use. OBrien & Wilde (1996) described in their study of 268 CEOs of Australian
business firms that change in chief executives attitude toward IT can be achieved by the
method of training adopted and stressed upon the structure of training, of great importance in
developing positive attitudes of the users. Training can provide better understand IT and as
such it significantly reduces computer anxiety and foster the positive attitude toward
microcomputers (Igbaria & Chakrobarti, 1990). Kasper and Cerveny concluded that greater
end-user experience increased the likelihood of end-user computing success. However, the
work of Ang & Koh provided a framework in which they classified computer literacy with
user training, frequency to use and user computer background. The more comfortable people
are with the technology, the more likely they are to use it (Ives et al. 1983). Gutek et al.
(1991) found the association in between individuals frequency and duration of use of
computer with the increase in computer literacy. The executives computer skills should have

EJISDC (2000), 2, 7, 1-17

a direct relationship with their desire to use computer (Palvi et al. 1994). As pointed out, this
factor has been used in various studies of end-user computing. Palvi et al (op cit) described
the following variables in order to assess skill of the chief executive; a) self taught computer
skill, b) formal education of the executive, c) executives computer experience d) ownership
of computer, and e) executive in- house and outside training. Nickell and Seado, (1986) have
pointed out that executive that takes computer class, and own microcomputer exert a positive
attitude toward the use of computer.
Based upon this theoretical background and model, we therefore propose the
following four hypotheses:
H2 (a) Academic qualification of CEO exerts a positive effect on the organizational use of IT.
H2 (b) Computer literacy of CEO exerts a positive effect on the organizational use of IT.
H2(c) Computer experience of CEO exerts a positive effect on the organizational use of IT.
H2 (d) Ownership of PC by CEO exerts a positive effect on the organizational use of IT.
Research Design
Design of instrument
From the review of literature an instrument was developed with the aim of covering the basic
research objectives regarding the survey in mind. The questionnaire was divided into two
parts. Part 1 captured the background information about the respondents organizational data.
Single item questions were used to ascertain respondents gender, age, educational level,
ownership of PC, and organizational hierarchical level in addition to the questions about the
organizational data. Computer experience and literacy was assessed in Part II of the
questionnaire. For this part an instrument used by Igbaria and Chakrobarti (1990) was
adapted. Most of the questions asked were structured and asked respondents to indicate
whether they had experience in using different types of computer software, different
computer languages and development of computerized information systems. Responses were
coded on five-point Likerts scale with 1 for no experience to 5 for excellent experience. The
total number of categories in which respondents reported experience was used as an overall
index of computer experience. Computer literacy was measured by individuals response to
four questions which asked them to respond in four categories: Formal computer course taken
at college level, participation in- house computer training program, outside training arranged
by vendors or consultant and finally any self-study by the respondents. The response was
measured categorically by coding 1 for any training received or 2 for no training. The
dependent variable ITUSE is measured on a five-point scale (not at all 1, occasionally 2,
about half of the time 3, most of the time 4, and all of the time 5) is therefore used to measure
the ITUSE. The statistical software package SPSS for Windows was used to analyze the data.
Instrument reliability and validity
Several techniques were used to assess the reliability Cronbachs coefficient () and to assess
content and construct validity. The part II of the questionnaire assesses six items on computer
experience. The coefficient () was calculated and found to be 0.84. This is in line with the
scale used by Igbaria (op cit).
To ensure face validity of the instrument the questionnaire was sent to some of the
staff of management department and also to some of the business managers of computing
firms. In light of discussion and feedback, the questionnaire was modified.
An instrument possesses Content validity if its scales are representative of all aspects
of the attributes being measured (Raymond, 1987). Evaluating content validity is basically a
question of judgment. During a pilot study phase in early 1998, an initial questionnaire was
given to thirty chief executives during a 2 days product seminar. We have selected every

EJISDC (2000), 2, 7, 1-17

second name from the registration Performa and the questionnaire was hand delivered to the
CEOs. During the tea break they were briefed about the objectives. At he end of the day 22
questionnaires were received at the registration desk. Three were dropped out as belongs to
the large organizations with over 500 employees and did not come under our definition of
medium sized organizations. The evidence from the discussion has not only provided a
content validity of our instrument that asked questions about chief executives profile but also
has provided a sound justification to propose various hypotheses. It has also provided the
base for selecting a sampling plan. The responses received from the pilot study of 19 chief
executives are in line with the responses measured by the instrument for this study.
Data collection
A survey was conducted from October 98 to December 98. A questionnaire was sent to 143
various private sector organizations, according to sampling plan. The details of which appear
in the Appendix. The questionnaire was delivered personally. Out of these, 103 organizations
have responded with a response rate of 72%. The questionnaire from fifty- four organizations
was filled up by their chief executives officers and was therefore retained for the purpose of
the survey thus bringing the real response rate to 54/143 = 38%. Further adopting
stratified/purpose selection method, the final results were classified into following main
groups. a) Banks/Insurance b) Hotels/Food Catering c) Travel & Shipping d) Retailers &
Wholesalers e) Construction f) Service organizations. For the purpose of the survey, the
above classification presents a reasonably and comprehensive approach towards inference
making on the study.
Results
Those fifty- four questionnaires that were completed by the CEOs were used for the analysis.
These questionnaire were received from a variety of business sectors, a breakdown is shown
below in Figure 2. It is useful to examine the characteristics of these respondents.

Figure 2 Main Business Activities of Responding Organizations

13%
33%

11%

6%

17%

Banking & Insurance

Trading/Retail
Construction
Food/Hotel
Shipping&Travel
Professional

20%

Out of the fifty- four organizations, 37% of the organizations were identified as
medium-sized companies and 63% are small-size companies.
The use of information technology ranges from somewhat use to very much use.
However, the majority (54%) of the organizations indicated their usage from most of the
time to all of the time (mean of 3.51 with standard deviation of 1.02). It is also noticed
that use of IT is at minimal level at 34% of the organizations.

EJISDC (2000), 2, 7, 1-17

35% of these organizations have annual sale of less than B$ 1 million. 40% of
organizations claimed their sales were in between B$ 2 million and 5 million. Whereas, 20%
of the business claimed their sales exceeded B$10 million.
Most of the respondents are aged between 30-39 years and possess first or Bachelors
degree. 63% of the respondents are male as compared to 37% of females. About 63% of them
reported to have a personal computer.
Hypotheses Testing
In line with the principles of multivariate data analysis, the paired or zero order correlation
between the independent and dependent variables is shown in Table 2. The correlation
provides directional support for the predicted relationship and shows that collinearity among
the independent variables is sufficiently low so as not to affect the stability of regression
analysis. Examinations of the correlation reveal that there exists an inter-correlation among
independent variables. The CEOs in- house training, ownership of PC, sales and type of
business are statistically significantly correlated with the usage of IT (dependent variable). It
is apparent from the table that correlation coefficient is significant and positive for three of
the four variables. However, negative correlation exists between ownership of PC and the
predicated use of IT. The correlation is negative but significant. That may be due to the fa cts
that slightly higher proportion of our respondents have PC but it affects towards use of IT is
negative. The next step is to look at the combined effects of these variables in predicting the
use of IT through stepwise multiple regression analysis. However, in conducting this
regression we should deal with the problem of multicollinearity. None of the variables are
highly inter-correlated thus fulfilling Hair et als (1979) criterion that says that variables to
qualify for multicollinerity should have coefficient of correlation .80 or above. The results of
stepwise multiple regression analysis is presented in Table 3.
Table 2 Pearson Correlation between IT Usage and antecedent variables (n = 54)
Variables
Mean
Std.
Coefficient
Dev ( r )
Organizational Variables
Size of business (SOFBUSS)
1.44
0.71
-.024
Sale of business (SALES)
2.08
1.10
.352 **
Type of business (BUSTYPE)
3.90
2.1
.255 *
Chief Executives Variables
Total Experience (TOTEXP)
2.35
1.04
.034
Ownership of PC (OWNPC)
1.38
0.49
-.277 *
Educational level of CEO (GENEDU)
1.94
1.05
.053
In-house training by CEO (COMTRGI)
1.16
0.35
.213 *
Outside training by CEO (COMTRGO)
1.11
0.31
.113
Self-taught Computer Skill (STAUGHT)
1.07
0.26
.226
Formal Computer Education by CEO 1.07
0.26
-.028
(COMPEDU)
** indicates statistical significance at (p< .05)
* p<.01

Computer experience is measured on six items; the reliability of the scale is calculated
as .90. Most of the items asked questions to determine various comput ing skills of the CEOs.
Most of the items correlate with each other. Similarly, computer literacy asked questions
about various training programs and any self-taught skill attained by the CEOs. Regression
analysis has further found that computer experience did not contribute toward the use of IT.
Whereas, among computer literacy, in-house training program is found to be significant
predictor in determining the organizational use of IT.

EJISDC (2000), 2, 7, 1-17

10

Table 3 Result of Stepwise Multiple Regression Analysis Predicting Use of IT

(n = 54)
Independent Variables
B
Beta
p-value
BUSTYPE
.252
.403
.013 *
SOFBUSS
SALES
OWNPC
COMTRGI
COMTRGO
COMPEDU
STAUGHT
TOTEXP
GENEDU
Multiple R = 54% R2 (adj) = 29%

-.195
-.099
.780
.623
-.887
-.310
1.11
.277
-.600
-.135
-.904
-.169
.995
.187
.077
.090
.087
.065
Std Error = 1.20

.487
.000 *
.110
.047 *
.637
.580
.411
.566
.648

The Durbin-Watson statistics is also calculated, as 1.85 that shows that problem of
auto-correlation does not exist. Further the R2 and adjusted R2 suggests the validity and
significance of the regression model. However, it found to be consistent with other studies
(Palvi et al 1994).
It is evident from our data analysis in Table 3 as above that our hypotheses H1(a),
H2(a) H2(c) and H2(d) are rejected. Whereas, hypotheses H2(b) is partially supported.
Hypotheses H1(b) H1(c) are found to be significant.
Discussion
One of the objectives of this study is to identify and assess the extent of the use of IT in
organization. On a five-point Likert scale the mean usage of IT in the organizations is 3.51
with a standard deviation of 1.0. From our survey 51% of the organizations claimed their
usage of information technology ranges from most of the time to all of the time. Whereas,
15% of the businesses use IT at about half of the time. Similarly, 31% of the businesses are
still using IT occasionally. It is interesting to note that out of the 56% of the business that use
IT about most of the time, only 21% are medium sized organizations. Conversely, out of
remaining 24% of the organizations that claimed the use of IT about half of the time, 66% of
the organizations are medium sized. This is evident from our hypotheses testing that the size
of the organization is not a determining factor in the use of IT. This in contrast with findings
of Ein- Dor & Segev (1978), Lind et al (1989) and Lesjek (1995) who has concluded that
small organizations are highly dependent on IT in promoting their business. However, our
findings are in line with Raymond and Megnenet (1982) and Gremillion (1994) who found
that size of the organization and use of microcomputer is not correlated. The size of the
business therefore, does not exert positive effects on the organizational use of IT.
The type of business is found to be a significant variable in our study. Our findings
support Valida et al (1994) who found that different business sectors have different levels of
IT integration. Organizations involved in goods and services have higher intensity of
computer usage as compared to those involved with product manufacturing and distribution.
Valida (op cit) concluded that both small and large firms in Malaysia are receiving similar
type of IT support. Our findings also confirm the results of a study by Currie (1996) and
Rahim et al (1998). A further analysis of means (ANOVA) between various groups and also
tests for significant differences has indicated that Banking and Travel business sector is more
avid user of IT.
The sales of the organizatio ns under survey are found to be significant contributing
factor in the use of IT. However, this study has confirmed the findings of Burn (1990) and
Valida (1994) who have studied IT among the Hong Kong and Malaysia based organizations
and concluded that IT is being used to gain competitive advantages. Our results of responding

EJISDC (2000), 2, 7, 1-17

11

organizations show the relationship of sales and the use of IT. We may conclude that IT is
used to increase the sales. However, the extent up to which IT is used for strategic or
competitive advantages are yet to be measured. It is very difficult to generalize the result on
the basis of our survey result. At present, the use of IT is measured on how much it is used
within the surveyed organizations but doesnt measure the purpose of use within the
organization. In order to find out the deeper insight of the findings, this issue has to be readdressed accordingly.
As far as chief executives parameters are concerned, most of the literature review
supports the notion that CEO with higher educational qualifications also has more positive
attitudes towards IT (Nickell & Seado, 1986). Furthermore, prior computer training is found
to be significant contributing factor (OBrien & Wilde, 1996; Schleich et al. 1990). Delone
(1988) and Montazemi (1998) identified the computer literacy as a significant attitude
determinant. In our survey of CEOs qualifications, computer experience and computer
literacy were measured. Under the umbrella of computer literacy several factors were
measured, such as in- house computer training, outside computer training and self- taught
computer skill of the CEOs. Only in-house computer training is found to be significant. This
supports Scawen (1989) who concluded that attitude can be influenced by education and
training or at least in short term, training can provide better understanding of IT. Our finding
also supports Palvi et al (1994) who stressed executives in- house training. This is a very
important finding and has to be investigated in greater depth in future studies.
In order to assess the computer experience of CEOs, several items were studied,
including the respondents experience with various packages and systems related tasks. None
of the several factors is found to be a significant predictor of the use of IT. This in contrast
with the findings of various researchers, e.g. Nazem & Price (1984), Soh (1990) and OBrien
& Wilde (1996), who found that experience with word processing dominate in determining
the CEOs positive effect on the organizational use of IT.
Finally, ownership of a PC by CEO is also found to be insignificant in exerting a
positive effect on use of IT. Although the self- reported ownership of PC among surveyed
participants is 63%, yet it has failed to exert a positive impact on the CEO use of IT, rather it
is negatively associated. This is another important factor and has to be investigated in depth.
However, this does not support the results of Nickell and Seado (1986) and Palvi et al (1994).
Conclusions, Limitations & Recommendations
This study has identified and assessed the degree of the use of IT among participating small
and medium business organizations in Brunei Darussalam. It has further identified the factors
that influenced the use of IT. One of the major findings is chief executive s computer
knowledge is positively associated with the use of IT. CEO knowledge of computer and
involvement leads to more successful use of IT in business. The use of IT is however
influenced by the organizational factors such as sales and type of business.
The research has also identified that most of the surveyed organizations are avid users
of IT, however it does not confirm the turnaround and strategic support from IT applications.
That provides an insight for the chief executives and policy makers in revising their mission
statements and to re-tune their perspective in promoting the business. Chief Executives not
only should explore the ways to adopt the latest technology but also to encourage their
functional and business managers to learn and use the various techniques of telemarketing to
get the business gain and to built a real IT culture. In order to build an IT based culture, IT
should be used not only to support management functions but also to support the operational
functions. The CEOs must look into the matter seriously.
As evidenced from our study the business in Brunei is using and relying on IT like
several other countries in this region (Burn 1990, Valida 1994 and Ang 1997). The use of IT

EJISDC (2000), 2, 7, 1-17

12

among Bruneian business organizations is in line with various neighboring countries such as
Hong Kong, Malaysia and Singapore, as reflected from the studies
(Op cit).
This study is also not free from it weaknesses as such the sample size is small and
some more variables could be further added. This might have significant impact on the
assessing the predicted use of IT in the business and could further improve the adjusted R2 .
However, we still recommend that result should be used with caution and can further be
improved with revised research methodology in future studies. Another weakness of this
study is found in a way, it does not measure the specific nature and level of use of IT in the
business.
Although the study is pioneering in its nature, yet it has provided some valuable
information on the na ture of IT use in Brunei, especially the influencing factors. Based upon
the experience gained from this study, an expanded survey is being planned where a more
detailed research instrument will be used on a wider sample of the organizations. This would
provide a richer picture of use of IT into business practices in Brunei Darussalam that may
provide the basis for comparison with other ASEAN countries.
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EJISDC (2000), 2, 7, 1-17

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Appendix
Sampling Design
Sample design covers the areas of sampling frame, sample size. The total number of business
establishments including very small retail shops such as tailoring, hair-cutting and laundry
shops are 4085 (Brunei Statistical Year book 1994). It is further estimated from the above
source that these very small enterprises with less than 10 employees carry about 64% of the
business and around 1% of the organizations are having more than 500 employees. Previous
released statistics on the basis of our pilot study has confirmed that about 76% of the business
are using computers from above average to frequently use. By using the formula for
estimating sample size for proportion1 and by setting 95% Confidence level (Z) and 7%
Precision Level (D).
N = (pq) (Z2 ) / D2
n = (.76)(.24) (1.96)2 / (.07)2
n = .7007 / .0049
= 143
Sample size of 143 organizations to be used for this study. This was further checked for
authenticity by using selected tables for determining sample size 2 . The total numbers of 143
sampling units were identified in the final stage on the basis of classification into various
business sectors according to their share of each sector as provided into Brunei Statistical
Year Book. Then by using Yellow Pages the organizations given in Boldface was selected to
be in the sampling plan. Based upon above stratified/purpose selection methods, the final
results were classified under following main groups:
Banking/Insurance, Construction, Hotels/Restaurants and Food Catering, Retails and
Wholesale, Travelling &Shipping and finally, Professional Services Organizations.
The above classifications were considered appropriate for the purpose of drawing the
overall results together in terms of identifying trend. For the purpose of survey, the above
classification presents a reasonable, comprehensive and wholesome approach toward
inference making based upon this study.

1
2

Zikmund, W.G., (1984) Business Research Methods, The Dryden Press.

Lin, N., (1976) Foundations of Social Research, McGraw-Hill. pp. 447.

EJISDC (2000), 2, 7, 1-17

16

Questionnaire
Part I Demographic Variables:

(Please put 3 in the appropriate box to indicate your choice)

(i) Nature of business:
Sole Trader

Partnership

Corporation

(ii) Type of business:

Bank & Insurance.
Hotel & Food Catering.
Retailer.
Construction
Professional Services
Travel & Shipping
(iii) Size of business
No of employee:

:
< or = 50

51 250

251 500

> 500

$Less 1million

$1 - 5 million

$6 - 10 million

> $10 million

(iv) Annual Sales:

Sales turnovers:

(iv) How much your business is using IT? (Microcomputers, networks, point of sales terminals etc)
Not at all use

Occasionally

About half of the time

Most of the time

All of the time

(v) Your Position (Job Title) : ___________________________________

(vi) Your level in the organization hierarchy :

Support Staff
Middle Management (Dept. Head).
Strategic Management (Chief Executive Officer)
(vii) What is your division / department : (in case you are support staff or middle managers)
Accounting
Personnel
Engineering

Finance
Information system
Legal

Marketing
Sales
Others

General Management
Production

EJISDC (2000), 2, 7, 1-17

(viii) Sex:

Male

(ix) Age:

Below 30 yrs

(x) Education:

17

Female
30-39 yrs

Secondary/Vocational School.

40-49 yrs
Bachelor

(xi) Do you own a personal computer?

Over 50 yrs
Masters

Yes

Professional

No

Part II Computer Literacy

Please 3 if you have had training in the use of computers through.
Yes
1.
2.
3.
4.

No

General courses at College or University

Outside training provided by Vendor or Consultant
In-house Company training.
Self-study.

Computer Experience:
Please circle ONE option only to indicate your actual experience with Computer.
1 = No Experience (NE)
4 = Good Experience(GE)

1.
2.
3.
4.
5.
6.

2 = Little Experience(LE)
3 = Average Experience(AE)
5 = Excellent Experience(EE)

Using computer packages such as spreadsheet, word processing or data

management
Use of computer languages such as SQL, ORACLE, DBASEIV, FOXPRO,
ACCESS
Building models on computers such as Financial, Statistical or Graphical.
Programming in computer languages such as COBOL, FORTRAN, BASIC,
PASCAL, C, C++.
Participating in the non-technical design of computer systems such as Feasibility
studies or Requirement Analysis.
Participating in the technical design of computer systems such as System Analysis
or Design and Implementation.

1
NE
1

2
LE
2

3
AE
3

4
GE
4

5
EE
5

1
1

2
2

3
3

4
4

5
5