Entrepreneurship plays an important role in the socio-economic development of the country. Its significance can be seen in terms of contribution towards economic growth, employment creation, poverty reduction and development of an industrial base. Kenya is going through a paradigm shift from an industry based economy to a knowledge based economy anchored on ICT. The government has reiterated the development of ICT industry in the country given its strategic importance. These commitments manifest in the various policies and strategies that the government has put in place over time, aimed at the growth and expansion of ICT in the country.
Despite the policy and strategy pronouncements, there are various constraints that are currently facing the growth and expansion of ICT in the country especially amongst ICT providers. The Purpose of the study was to establish the factors affecting growth of ICT Firms in Nairobi. The specific objective of the study was; To establish the influence of policy environment on growth of ICT firms in Nairobi.
The study involved a case study of ICT firms in Nairobi. The target population constituted ICT service providers located in Nairobi. The study targeted 92 firms out of 304 registered ICT service providers in the CCK database. The sampling frame used was acquired from the CCK directory of licensed ICT providers 2012. Stratified random sampling technique was used based on categories of ICT service providers registered by CCK.
Questionnaires were used to collect data from a sample of 92 ICT Firms. The respondents were owner/ managers and selected employees. The study findings indicate that ICT policy environment significantly affects growth of ICT firms negatively or positively. Regarding ICT policy environment; The government has fully liberalized ICT sector in the country, there is effective and fair regulation of the ICT sector in the country, the policy environment is conducive for the growth and expansion ICT in the country, the government has favorable ICT policy to promote growth and expansion of ICT, the government has effectively promoted ICT infrastructure in the country and Government supports capacity building in ICT sector. Despite the existence of a conducive policy environment, there are no sufficient policy incentives to enhance investment in ICT.
The study recommends the following regarding Policy Environment; The government should strive to improve the effectiveness of the existing institutions by strengthening the Department of Micro and Small Enterprise Development (DMSED) and MSE Associations, establishing National Council for Small Enterprises and legislating a Micro and Small Enterprises Act.
The government should undertake to invest in ICT research centres that nurture innovation and networking of entrepreneurs, streamline licensing procedures and enhance capacity building initiatives in ICT firms especially on emerging technologies and monetization strategies for application developers.
Casson, M. (2003). The Entrepreneur: An Economic Theory .University of Illinois at Urbana- Champaign's Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship. Available at SSRN:http://ssrn.com/abstract=1496173
Chandler, A.D. 1977. Information technology: the visible and new competitive weapon. Cambridge: Belknap press.
Duncombe, R., & Heeks, R., (2005). “Information, ICTs and Small Enterprise: Findings from Botswana”, Development Informatics, Working Paper Series, Institute for Development Policy and Management, University of Manchester.
Glaser, P.J. (2001) Information Technology Strategy: Three Misconceptions. Partners Health care. Boston, USA.
Government of Kenya (2005). Development of Micro and Small Enterprises for Wealth and Employment Creation for Poverty Reduction: Sessional Paper No. 2 of 2005. Government Printer. Nairobi, Kenya.
Government of Kenya (2006). National Information & Communications Technology (ICT) Policy. Ministry of Information & Communications. Government Printer. Nairobi, Kenya.
Government of Kenya (2008). Kenya Vision 2030; The Popular Version. Government Printer. Nairobi, Kenya.
Government of Kenya (2013). National Information & Communications Technology (ICT) Master plan 2013-2017. Kenya ICT Board. Government Printer. Nairobi, Kenya.
KIPPRA (2002). Review of Government Policies for the Promotion of Micro & Small Scale Enterprises, KIPRA Publication, Nairobi.
Miles, P. (2001). Globalization- Economic Growth and Development and Development Indicators, Planet Papers, Oxford Press, New York.
Mutula S.M. & Brakel P.V. (2006). E-readiness of SMEs in the ICT sector in Botswana with respect to information access. The Electronic Library, 24(3), 402-417.
Pohjola, M. (2002). The New Economy in growth and development, Oxford Review of Economic Policy 18(3):380–396.
Sewe (2010). Factors affecting the strategic growth of Information Communication Technology (ICT) in Kenya. United States International University. Nairobi.
UNPAN (2005). “Global E-government Readiness Report: From E-government to E-Inclusion, UNPAN, Geneva
World Bank (2012). Kenya Economic Update.. Accessed on http://www.worldbank.org/en/news/press-release/2012/12/05/energizing-kenya- seconomy- and-creating-quality-jobs on 23 October 2012.
WSIS (2005). Information Communication and Technology Growth Strategies, World Information Society, Geneva
Copyright: © 2014 The Author(s)
Published by Human Resource Management Academic Research Society (www.hrmars.com)
This article is published under the Creative Commons Attribution (CC BY 4.0) license. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this license may be seen at: http://creativecommons.org/licences/by/4.0/legalcode
