An information technology governance framework for micro, small and medium enterprises under the Youth Livelihood Program

Abstract

The use of Information Technology (IT) is undeniably necessary in business enterprises in today’s knowledge society as it has been proven to create efficiency, improve information handling, broaden the market reach, increase the visibility of the business and so many other benefits. In simple terms, using IT in today’s knowledge society is significantly linked to the enterprise’s achieving its business objectives and goals. The use of IT today therefore requires focus on IT governance so as to achieve efficient and effective use of IT tools in the business enterprises. The context of IT governance is different for every business enterprise based on the size of the business. Large scale businesses use comprehensive frameworks however Micro, Small and Medium Enterprises (MSMEs) need to customize comprehensive IT governance frameworks to one that is suitable. A number of comprehensive IT governance frameworks exist however, in the perspective of MSMEs, they are generic in nature, have complicated procedures and are expensive to implement. Therefore, a suitable framework is required to not only complement the shortcomings of the existing frameworks in the perspective of the MSMEs but to also guide MSMEs on proper management of IT tools through effective IT governance. This study investigated and analyzed the challenges faced by MSMEs in their attempt to implement IT governance (manage the usage of IT tools) and proposed a framework for guiding IT governance activities in the MSMEs. This study adopted the Design Science research methodology. The output of the study - the IT governance framework for MSMEs under the YLP was developed based on the requirements derived from an exploratory study, conducted to collect primary data from 35 business enterprises under the Youth Livelihood Program (YLP) in Kampala Central Division (KCD). The IT governance framework was also developed with guidance from the existing IT governance frameworks including; COBIT 5: Adding value through Governance of Enterprise Information Technology, ITIL and ISO 38500. The IT governance framework was validated following the usability and fitness parameters in line with the design science methodology. The results confirmed that the framework was suitable and usable by the MSMEs. The IT governance framework for MSMEs is a guideline that can not only enhance alignment of IT tools to business goals in MSMEs but can also improve efficiency, increase sales and create sustainability thus facilitate the repayment of government loans provided through the YLP. However, this requires the support of all stakeholders: Ministry of Gender, Labor and Social Development (MGLSD), NITA-U and business enterprise owners, by supporting the adoption of the framework and the IT governance activities.