Investigating the Effects of Technology Adoption on the Performance of Small and Medium Enterprises (SMEs) In Zambia: A Case Study of Kitwe District

This study examined the effect of technology adoption on the performance of small and medium-sized enterprises (SMEs) in Kitwe town. This paper was motivated by the three specific objectives; to determine the extent to which technology has been adopted by SMEs; assess how technology adoption affects SME revenue; and to evaluate how technology adoption influences operational costs among SMEs in Kitwe town. Quantitative approach was adopted, with 50 different businesses selected through purposive random sampling. The results show that at least 70% of SMEs have adopted at least one form of technology in their businesses and chi-square test yielded the significant distribution with test of independence proving positive (x2=15.67, p=0.003) which shows statistically significant association between the size of the SMEs and the level of technology. The results on the effect of technology on SMEs revenue, regression analysis showed a positive coefficient (0.25, p =0.002) indicating that for every unit increase in technology adoption, SMEs revenue increases by an average of 25% and these results show that it is statically significant. The regression function thus gave a positive slope in the function indicating a positive relationship with high causality influence. The effect of technology influence on operational costs among SMEs showed an inverse relationship tested significant at 50, t-test output (t=4.56, p=0.001) which is statistically significant. The slope was found to have a value of -7 factor reduction in operational costs for every unit of technology incorporated in the business. This was a remarkable indicator showing that there is a reduction in operational costs to a tune of 7 times after technology adoption of a unit. Indeed, technology adoption leads to lower operational costs. This study further found that over 74% of businesses were able to adopt technology without extreme financial strain, while a smaller portion faced higher costs that may have limited the scale or speed of adoption. Overall, the data suggests that there is positive correlation between technology adoption and business performance however this comes with its own bigger and minor challenges depending on the size and type of the firm of the business. The study recommends expanding technology integration, financial support and affordability, encourages awareness and knowledge sharing as well as capacity building and skills. The government needs to invest in research and development and reward innovation for those SMEs adopting and devising new technologies.