IBIMA Publishing Journal of Innovation Management in Small & Medium Enterprises http://www.ibimapublishing.com/journals/JIMSME/jimsme.html Vol. 2012 (2012), Article ID 271072, 14 pages DOI: 10.5171/2012.271072 Copyright © 2012 Hanitahaiza Hairuddin, Nor Laila Md Noor and Erne Suzila Kassim. This is an open access article distributed under the Creative Commons Attribution License unported 3.0, which permits unrestricted use, distribution, and reproduction in any medium, provided that original work is properly cited. Contact author: Hanitahaiza Hairuddin E-mail: nita_arif@puncakalam.uitm.edu.my Developing Therapy-Based IT Adoption Model for Microenterprises Hanitahaiza Hairuddin 1 , Nor Laila Md Noor 2 and Erne Suzila Kassim 1 1 Centre for Applied Management Studies, Faculty of Business Management, Universiti Teknologi MARA, Selangor, Malaysia 2 Centre of Information Technology Studies, Faculty of Computer and Mathematical Sciences, Universiti Teknologi MARA, Selangor, Malaysia _________________________________________________________________________ Abstract In Malaysia, microenterprises contribute to almost 80% of the national business establishment. While studies have consistently reported information technology plays an important role in flourishing business operations, the majority of microenterprises in Malaysia still have not utilized the IT to its full capacity. In this case, two significant factors have been recognized; lack of IT skills and knowledge and the degree of the IT application complexity. Therefore, to encourage consistent IT adoption among this group, a unique approach based on SOPHIE clinical therapy method was proposed as an intervention program. However, since adopting the clinical approach is different from a regular IT training and is not a common IT adoption technique, a situational analysis should be conducted to understand the specific issues of the microenterprises. Hence, personal interviews, observations and document reviews of clinical therapy practice were conducted before the appropriate approach is designed. Components of SOPHIE method were then identified and mapped into the new IT therapy conceptual model. The model can later be used as a business solution to improve the productivity of microenterprises. Keywords: IT Therapy, SME, indigenous microenterprise, IT Management. _____________________________________________________________________________________________________________ Introduction Small and medium enterprises (SMEs) are a major component of the private sector. SMEs have now become an important engine of economic growth and seed beds for entrepreneurship. Their business activities can be generalized as home- based, farm-based and street-based with a number of full time workers less than five or their sales turnover is less than USD80,000 (Saleh and Ndubisi, 2006). Common products and services include food and beverages, arts, cultural and heritage items, education and consultation and real estate. However, many SMEs operate in the informal sector and are technologically backward due to the lack of funding, weak management practices and unfriendly environmental production processes (APO, 2007). In Malaysia, microenterprises dominate the businesses establishment in the country which is comprised of 78.6% of the total number of businesses (National SME Development Council, 2010). The Malaysian government has established the Small and Medium Industries Development Corporation (SMIDEC) in 1996 to promote the development of the indigenous enterprises through skills development programs and other financial assistance. Studies on SMEs in Malaysia cited that the low level of technology is one of the factors that hamper the competitiveness of SMEs (Za’afaran, 2007). To reduce the low adoption rate, SMIDEC has promoted the