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Application of IT in Small-Medium Businesses

Small and medium enterprises continue to be vital support to the economy. The contribution of SMEs to the economy in terms of taxes and job creation continues to grow year after year. Nearly two-thirds of all of the employment that has been created in the private sector in the United States in the last several decades have been generated by the country’s 30 million SMEs. However, as other sectors continue to implement sophisticated technology that has seen them optimize their operations, most SMEs have lagged behind in technology adoption. This, however, can be attributed to the lack of technologies that have been tailored to serve SMEs specifically. Even for those SMEs implementing IT in their operations, most of the technology they employ is designed for large businesses. Due to this, most SMEs continue to suffer inefficiency, hindering their growth.

One such SME is Gusto Company which has been classified as a medium enterprise. Gusto is a company that offers a service that helps you manage your expenses. Gusto is a private company that provides cloud-based accounting software to companies worldwide. Founded in 2008, the company has grown quickly over the last ten years and now serves over 6 million users worldwide. Gusto was founded on the belief that all people deserve access to great financial management tools and that those tools should work seamlessly with the rest of their lives—from their phones to their computers, from their bank accounts to their credit cards, and beyond. Gusto’s founders knew that this would require an innovative approach to solving some problems that had plagued small businesses for centuries: lack of access to reliable information about their finances and sales reports; lack of transparency when it came time for employees to review budgets; and an inability for many businesses to feel confident about reporting accurate numbers to investors or creditors (Sullivan, 2020).

Although the company is a technology company offering technological solutions to other companies, Gusto Company still faces challenges facing other SME businesses. Gusto’s biggest challenge is integrating its services with existing software and systems, including customer relationship management (CRM) tools, accounting software, payroll systems, and other back-office systems. Gusto’s second challenge is the enterprise’s lack of robust data management tools. In order to make critical decisions, they need access to all kinds of information at once—not just sales data but also information about employee performance and customer satisfaction levels. The third challenge faced by Gusto is Gusto does not have a strong team of customer service representatives (CSRs) dedicated to helping customers with their issues. It does not have enough people to quickly respond to customer requests for help. Hence, the company misses opportunities to collect customer feedback and improve its product offerings.

The first step to solving their problem, Gusto Company has to first solve enhances its data security. This is mainly because customers access Gusto’s software through the internet; thus, they need to be able to trust that their data is safe and secure. Additionally, if the company relies on collected data to make critical decisions, they need to be sure of its data integrity and privacy. These two are some of the common reasons the implementation of the technological solution at the SME level fails. Data privacy and cyber security can be used to solve these technology problems by ensuring that the data they collect is secure.

Data privacy is securing personal information, like names, addresses, social security numbers, etc., from hackers and other malicious parties who may be looking to access them for their gain (Salam, 2020). Cyber security protects computers from viruses and other malicious programs that could harm the computer’s hardware or software. Because Gusto doesn’t have access to large budgets or complex software systems, they can benefit greatly from having reliable data privacy and cyber security solution that is easy to use and requires no technical knowledge. Gusto Company can achieve maximum digitization through simple cyber and data privacy techniques such as virtualization and authentication. These services would enable them to set up file data locks so only authorized users can access them. Similarly, if the company uses cloud storage for its files, it should use password protection so that anyone who steals the password cannot access all the company’s files unless they know the other passwords.

The next problem Gusto needs to address is the shortage of Customer service representatives. When a company can’t find enough CSRs to meet its needs, it can be very difficult for them to provide quality customer service to their customers. Customers will often leave unhappy after being unable to get through to a CSR when they need help, which is why SMEs are eager to find ways to address this shortage in their business. Hiring CSR can be cost-ineffective for an SME organization such as Gusto and significantly reduce their revenues. The customer service representatives (CSRs) shortage is a major problem in the SME sector. In the past, it was common practice for companies to hire CSRs temporarily. However, with the increasing use of social media, companies have realized that they must provide long-term customer support. As a result, many companies are implementing solutions that utilize Networks, the Internet of Things (IoT), and Edge Computing to address this issue (Basir et al., 2019). These technologies automate some aspects of CSR work, taking pressure off of staff members so they can focus on more strategic tasks. This approach allows companies to reduce costs while still providing excellent customer service.

For example, Networking allows companies to create virtual networks from anywhere. This means that customers can contact their CSR through email or social media without having to travel to them directly when they have an issue with their product or service. This helps reduce costs for both companies and customers by allowing them to communicate without physical access, saving time and money on transportation costs. In addition, edge computing allows CSRs to access more information about their customers than ever through automated calls or text messages sent directly into their inboxes/chat rooms/social media pages, etc., based on specific triggers such as time spent on a website. Lastly, technology such as the Internet of Things (IoT) allows for integrating computing, communication, and other resources over a network so that users or devices can access them. It also allows for the exchange of data between various sources, such as sensors and devices on the IoT network. These technologies allow SMEs to have real-time data collection, allowing them to use cloud services without having an expensive data center infrastructure required for traditional computing models.

In conclusion, Networks, the Internet of Things (IoT), and Edge Computing can be used to solve SMEs’ challenges by giving them access to new tools that allow them to monitor their activities and services in real-time and improve their efficiencies (Turban et al., 2021). This is vital to SMEs as they have limited resources and manpower to do this the traditional way. SMEs can use these technologies to gain competitive advantages by saving on cost and improving their efficiency. The other solution is offered by Data privacy and cyber security technologies. These technologies ensure that the company data is safe and reliable for making important business decisions.


Basir, R., Qaisar, S., Ali, M., Aldwairi, M., Ashraf, M. I., Mahmood, A., & Gidlund, M. (2019). Fog computing enabling industrial internet of things: State-of-the-art and research challenges. Sensors19(21), 4807.

Salam, A. (2020). Internet of things for sustainability: perspectives in privacy, cybersecurity, and future trends. In Internet of Things for sustainable community development (pp. 299-327). Springer, Cham.

Sullivan, P. (2020). What Are Fintechs and How Can They Help Small Business? The New York Times10.

Turban, E., Pollard, C., & Wood, G. R. (2021). Information technology for management: Driving digital transformation to increase local and global performance, growth and sustainability (12th ed).


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