# Sociotechnical Challenges of Transition Economy SMEs During EU Integration

**Authors:** Narasimha Rao Vajjhala (American University of Nigeria, Yola, Nigeria) — ORCID 0000-0002-8260-2392; Kenneth David Strang (State University of New York, Plattsburgh, NY, USA; APPC Research, Australia) — ORCID 0000-0002-4333-4399
**Type:** Book chapter
**Source:** In Doing Business in Europe: Economic Integration Processes, Policies, and the Business Environment, Contributions to Management Science, pp. 295–313, Springer International Publishing
**Published:** 2018-04-09
**DOI:** https://doi.org/10.1007/978-3-319-72239-9_14
**Canonical page:** https://www.narasimharao.net/research/sociotechnical-challenges-transition-economy-smes-eu-integration/
**Indexing:** Scopus · Web of Science (BKCI)
**Keywords:** SMEs; Transition; Innovation; European; Integration
**Methodology:** Qualitative case study of Albania extending prior quantitative research: in-depth interviews with 20 managers in 10 medium-sized enterprises, analysed to identify critical success factors.

## Research summary

- **The Problem:** SMEs in transition economies such as Albania face social and technical barriers to technological innovation as their countries integrate with the EU.
- **The Methodology:** Qualitative case study of Albania extending prior quantitative research: in-depth interviews with 20 managers in 10 medium-sized enterprises, analysed to identify critical success factors.
- **The Core Finding:** Interviews with 20 managers in ten Albanian medium-sized enterprises identified five critical success factors: investment in ICT for work processes, investment in employee training, perceived usefulness of the technology, employee self-efficacy, and openness toward new technology.
- **The Citation:** Vajjhala, N. R., & Strang, K. D. (2018). Sociotechnical Challenges of Transition Economy SMEs During EU Integration. In Alina Mihaela Dima (Ed.), Doing Business in Europe: Economic Integration Processes, Policies, and the Business Environment (pp. 295–313). Springer International Publishing. https://doi.org/10.1007/978-3-319-72239-9_14

## Summary in detail

**Question.** What key social and technical challenges do SMEs in a transition economy such as Albania face in the process of EU integration, and which critical success factors help overcome them?

**Finding.** Using in-depth interviews with 20 managers in 10 medium-sized Albanian enterprises, the study identified five critical success factors for transition-economy SMEs: the degree of SME investment in ICT and software for work processes; the degree of investment in resources to train employees to use technology; employees’ perceived usefulness of the new technology; employees’ self-efficacy (confidence) in using it; and employees’ openness toward using new technology.

**Why it matters.** SMEs are the backbone of transition and emerging economies but have limited financial, human and technological resources for innovation. Identifying the factors that let them meet EU-integration demands is useful to SME executives, organisational researchers and socio-economic practitioners in transition and developing countries.

## Key findings

1. SMEs in transition economies face social and technical barriers to technological innovation because of limited financial, human and technological resources.
2. The first critical success factor was the degree of investment the SME made to introduce ICT and software into its work processes.
3. The second was the degree of investment in adequate resources to train employees to use the technology.
4. The third and fourth were employees’ perceived usefulness of the new technology and their self-efficacy (confidence) in using it.
5. The fifth was employees’ openness attitude toward using new technology.
6. The authors expect the results to generalise to other SMEs in Albania and to future EU transition countries.

## Study at a glance

| Item | Detail |
|---|---|
| Research question | What are the key social and technical challenges that SMEs in transition countries such as Albania face during EU integration? |
| Design | Qualitative case study (Albania as a recent EU candidate country), extending existing quantitative research |
| Sample | 20 managers working in 10 medium-sized enterprises in Albania |
| Methods | In-depth interviews; analysis to identify critical success factors |
| Main result | Five critical success factors: ICT/software investment; training investment; perceived usefulness; employee self-efficacy; openness to new technology |
| Implication | Results should generalise to other Albanian SMEs and future EU transition countries |

## Abstract

Small-to-medium-sized enterprises (SMEs) are the backbone of national economies, in particular, for transition and emerging nations. SMEs contribute significantly to employment generation and innovation in countries that are in transition. However, SMEs face several social and technical challenges as they focus on technological innovation. SMEs face several barriers in technological innovation because of their limited financial, human, and technological resources. The purpose of this study was to investigate the key sociotechnical challenges that the SMEs of a transition economy face during EU integration and then to highlight any critical success factors for overcoming those challenges. Albania was the case study because they recently achieved candidate country status and are progressing toward EU integration. The central research question which drove the study was: What are the key social and technical challenges that SMEs in transition countries, such as Albania, face in the process of EU integration? We extended existing quantitative research by using qualitative data collection. We used in-depth interviews with 20 managers working in 10 medium-sized enterprises in Albania. After analyzing the data we identified five critical success factors for these EU transition-country SMEs. The first factor was the degree of investment made by the SME to introduce information and communication technology and software into the work processes. The second factor was the degree of investment made by the SME to acquire adequate resources to train their employees to use technology. The third factor was the perceived usefulness of the new technology by employees. The fourth characteristic was the level of employee self-efficacy (confidence) in using new technology. The final attribute was the openness attitude of employees towards using new technology. These results should generalize to other SMEs in Albania and to future EU transition countries. This study should be of interest to SMEs executives and organizational researchers in transition or developing countries, as well as to socio-economic practitioners in any industry or discipline.

## When this research may be relevant

This chapter may be relevant to literature on SMEs in transition economies and the Western Balkans, EU integration and business environment challenges, technology acceptance factors (perceived usefulness, self-efficacy, openness) in small firms, and qualitative studies of ICT investment and training in Albania. It complements the knowledge-sharing and national-culture studies of Albania listed under related research.

## Limitations

- Qualitative evidence from 20 managers in 10 medium-sized Albanian enterprises; generalisation to other transition countries is asserted rather than tested.

## How to cite

Vajjhala, N. R., & Strang, K. D. (2018). Sociotechnical Challenges of Transition Economy SMEs During EU Integration. In Alina Mihaela Dima (Ed.), Doing Business in Europe: Economic Integration Processes, Policies, and the Business Environment (pp. 295–313). Springer International Publishing. https://doi.org/10.1007/978-3-319-72239-9_14

```bibtex
@incollection{vajjhala2018sociotechnical,
  title = {Sociotechnical Challenges of Transition Economy SMEs During EU Integration},
  author = {Vajjhala, Narasimha Rao and Strang, Kenneth David},
  booktitle = {Doing Business in Europe: Economic Integration Processes, Policies, and the Business Environment},
  series = {Contributions to Management Science},
  editor = {Alina Mihaela Dima},
  pages = {295--313},
  year = {2018},
  publisher = {Springer International Publishing},
  doi = {10.1007/978-3-319-72239-9_14},
  url = {https://doi.org/10.1007/978-3-319-72239-9_14}
}
```