IMPACT OF SELF SERVING SERVICE (ONLINE SERVICE) ON THE

COMPANY COMPETENCE IN THE IT SECTOR IN EGYPT

STUDENT NAME: Amr Mohamed El Manhawy

COURSE NAME: Master of Business Administration
DEPARTMENT: Management
COURSE CODE: Research Methodology - Intake #3
 CONTENTS
ABSTRACT ...................................................................................................................................................................... 4

INTRODUCTION ............................................................................................................................................................ 5

BACKGROUND OF EGYPTS RISE IN INFORMATION TECHNOLOGY INDUSTRY.................................................................. 5

SELF-SERVING SERVICE (ONLINE SERVICE) .................................................................................................................... 6
Examples of Online Service Provider ........................................................................................................................ 6
BOOM OF ONLINE INDUSTRY OF EGYPT .......................................................................................................................... 6
KEY CONCEPTS DISCUSSED IN THE PAPER ...................................................................................................................... 7
Key Challenges .......................................................................................................................................................... 8
Advantages of Self-serving Service That Play a Positive Role in Increasing the Company Competence in the
Information Technology Sector.................................................................................................................................. 8

PROBLEM STATEMENT ............................................................................................................................................ 11

OVERVIEW .................................................................................................................................................................... 11
RESEARCH QUESTION ................................................................................................................................................... 11
HYPOTHESIS .................................................................................................................................................................. 11
H 1 (the research/alternate hypothesis) ................................................................................................................... 11
H 0 (the null hypothesis) .......................................................................................................................................... 12
THEORETICAL FRAMEWORK (MODEL AS FOLLOWS) ..................................................................................................... 12

OBJECTIVES AND AIMS ............................................................................................................................................ 13

OVERALL OBJECTIVE .................................................................................................................................................... 13

SPECIFIC AIMS .............................................................................................................................................................. 13

BACKGROUND AND SIGNIFICANCE ..................................................................................................................... 14

INTERNET IN EGYPT ...................................................................................................................................................... 14

BACKGROUND OF INFORMATION TECHNOLOGY SECTOR OF EGYPT .............................................................................. 15
Cost Competitiveness ............................................................................................................................................... 15
Geographical Location ............................................................................................................................................ 15
World-class Telecommunications Infrastructure and Services................................................................................ 15
Focus on Research and Development, Entrepreneurship and Innovation............................................................... 15
KEY CHALLENGES IN THE WAY OF INFORMATION TECHNOLOGY INDUSTRY OF EGYPT................................................ 16
E-COMMERCE ............................................................................................................................................................... 17
Enhancing the Information Infrastructure ............................................................................................................... 17
THE ROLE OF WEBSITES IN INCREASING COMPETENCE OF INFORMATION TECHNOLOGY SECTOR ................................ 17
THE ROLE OF E-FINANCE IN INCREASING COMPETENCE OF INFORMATION TECHNOLOGY SECTOR ............................... 18
THE ROLE OF ONLINE CUSTOMER FORUM IN INCREASING COMPETENCE OF INFORMATION TECHNOLOGY SECTOR ..... 18
THE ROLE OF ENTERTAINMENT IN INCREASING COMPETENCE OF INFORMATION TECHNOLOGY SECTOR ..................... 19
THE ROLE OF ONLINE STORES IN INCREASING COMPETENCE OF INFORMATION TECHNOLOGY SECTOR ....................... 19

RESEARCH DESIGN AND METHODS ..................................................................................................................... 20

2
 OVERVIEW .................................................................................................................................................................... 20
POPULATION AND STUDY SAMPLE ................................................................................................................................ 20
Convenience Sampling............................................................................................................................................. 20
Purposive Sampling ................................................................................................................................................. 21
Quota Sampling ....................................................................................................................................................... 21
SAMPLE SIZE AND SELECTION OF SAMPLE .................................................................................................................... 21
Confidence Level...................................................................................................................................................... 22
Population Size ........................................................................................................................................................ 22
Proportion................................................................................................................................................................ 22
Confidence Interval.................................................................................................................................................. 22
Confidence Interval: Upper and Lower ................................................................................................................... 22
Standard Error......................................................................................................................................................... 22
Relative Standard Error........................................................................................................................................... 22
Sample Size .............................................................................................................................................................. 23
Formula Used to Calculate the Sample Size............................................................................................................ 23
SOURCES OF DATA ........................................................................................................................................................ 23
COLLECTION OF DATA .................................................................................................................................................. 23
DATA ANALYSIS STRATEGIES ....................................................................................................................................... 24
TIMEFRAMES ................................................................................................................................................................. 24

REFERENCES ............................................................................................................................................................... 25

3
 ABSTRACT

Background
Despite of massive uprising in Egypt in January 2011 that overthrew the former regime,
Information Technology industry grew at an astonishing double-digit rate1. The tremendous
improvement in demographics and development in information and communication technology
infrastructure has benefited the IT industry of the country. This boom of the Information Technology
industry of Egypt inspired me to conduct a comprehensive and thorough research about any
specific aspect of IT industry of Egypt that tends to increase its competitiveness. Thus, the impact
of self-serving service (online service) is studied in this research and its impact on the company
competence in the Information Technology sector in Egypt will be analysed.

Methods
Primary and secondary sources are usually used to conduct an effective research and to
obtain accurate results2. Primary sources used in this study are questionnaires and case studies.
Questionnaires will be filled by under graduate or post graduate students of Information
Technology related fields. Secondary sources used are Information Technology related annual
reports of Egypt and websites. Journals, articles, annual reports and books are referred for
literature review.

Discussion and Conclusion

All the results obtained out of the research will be analysed using various techniques. The
most appropriate strategy that will be used to analyse the collected data will be Excel. Additionally
text from authentic annual reports on Information Technology sector of Egypt will be used to further
support and verify the data collected from the questionnaire analysis. Literature review will also
play a significant role to deduce authentic results by supporting the facts and figures that are
brought to light after data analysis. The research hypothesis, the self-serving service (online
service) has an impact on the company competence in the Information Technology sector in Egypt
will either be accepted or rejected according to the conclusions drawn from data collection and
analysis.

1
Egypt Information Technology Report Q1 2012. Cairo: Business Monitor International (BMI); 2012.
2 Kumar, Ranjit. Research Methodology. New Delhi: Pearson Education; 2009.

4
 INTRODUCTION
The aim of this research is to decipher facts about self-serving service that have impacted
the company competence in the Information Technology sector in Egypt. The key challenges,
growth and competitiveness are discussed in detail. The research aims to figure out the factors
about online services that have played a vital role in increasing competence of companies in the
Information Technology sector of Egypt and also find solutions and reasons of the facts that
negatively affect the competence of companies in the Information Technology sector in context of
self-serving services. The online services that will be studied in this research proposal include
websites, e-banking, e-commerce, online stores, entertainment, emails, online customer forum and
e-finance.

Background of Egypts Rise in Information Technology Industry

Despite of massive uprising in Egypt in January 2011 that overthrew the former regime,
Information Technology industry grew at an astonishing double-digit rate3. The fundamental reason
that led to this rise in Information Technology industry is the direct outcome of recovery following
uprising in Egypt in January 2011 and the growth in citizens buying personal computers for their
use and the huge entry of users who wanted to be connected4. The tremendous improvement in
demographics and development in information and communication technology infrastructure has
benefited the IT industry of the country. Within two years of the uprising, IT industry has still
managed to regain its strong position in the Middle East and Africa region5. The aim of this study is
to analyze company competence in Information Technology sector in Egypt in context of self-
serving service (online service). Company competence6 refers to numerous capabilities, potentials,
knowledge, set of required skills and proficiencies that empower an organization to work efficiently
in a particular market segment or situation. Information Technology7 refers to usage of computers
and numerous forms of telecommunication equipments that are used to store, retrieves, transmit and
manipulate data. The term is generally assumed to be linked with computers only but it includes many forms
of information distribution technologies like telephones, cellular phones and television. Number of industries
are linked with Information Technology like internet, semiconductors, hardware and software of computers,
e-commerce and telecom sector.

3
Egypt Information Technology Report Q1 2012. Cairo: Business Monitor International (BMI); 2012.
4 ibid
5
Rezler, Tanya . Businesswire. 30 January 2012. 10 August 2013.
6
Sanchez, Ron . Fundamental Issues in Competence Theory Development. London: Emerald Group; 2008.
7
Stoyles, Pennie , Peter Pentland and David Demant. Information Technology. New York: Smart Apple
Media; 2004.
5
Self-serving Service (Online Service)
Self-serving Service8 refers to a system that plays a significant role in todays
technologically advanced world. It aids in providing secure answers to the inquiries of people in a
well automated way rather than old traditional methods. The demand for more advanced customer
service has grown drastically over the past few decades. The concept of call center representative
and online frequently asked questions page does not tend to satisfy information hungry customers,
thus online service concept has gained boost. With this increased demands of customers for online
services, many companies are turning to Information Technology firms to get online service tools
and equipments. Self-serving Service has helped in numerous ways as it gives an opportunity to
the companies to freely automate several tasks and co-ordinate and communicate with their
customers in a number of ways without having to tangibly answer the questions, requirements,
demands and difficulties of end-users who are inquisitive about the certain procedure that is being
automated9. Online services have allowed individuals as well as companies to shape, modify and
direct customer support, technical support and employee support inquiries.

Examples of Online Service Provider

With the evolvement of technology at a huge scale, many types of online services have
emerged that are being used by people at individual as well as organizational level. Few of the
online services include internet services, automatically generated emails, press, entertainment
related online services, online stores, internet banking, government sites and e-finance10. The
online services that will be studied in this research proposal include websites, e-banking, e-
commerce, online stores, entertainment, emails, online customer forum and e-finance.

Boom of Online Industry of Egypt

Egypts internet boom is likely to consequence in online services becoming household
brands and will generating million dollars profit for its founders. This expected boom in online
services is determined by broadband diffusion reaching a tipping point. According to current survey

8
Boyle, James. Shamans, Software, and Spleens: Law and the Construction of the Information Society. New
York: Harvard University Press; 1996.
9
Schleyer, Titus K. L., Heiko Spallek and Gisela Spallek. The global village of dentistry: internet, intranet,
online services for dental professionals. New York: Quintessence Publishing; 1998.
10 Stoyles, Pennie , Peter Pentland and David Demant. Information Technology. New York: Smart Apple
Media; 2004.
6
report of Egypt, there are more than 2 million DSL subscribers that have made this online business
economically feasible11.
The major reasons that have led to this boom of online service sector in Egypt are as
follows:
Information Technology sector of Egypt has aimed to target masses, poor class not only
affluent, millions of people not merely a specific target market comprising of few
thousands12.
The vision of IT experts of Egypt is to empower the LONGTAIL. They are not only
restricted to multinationals and big organizations instead they have framed their structure in
a way to satisfy the demands and needs of small businesses with less than 20 employees.
Their online service structure is designed in a way to fulfil the needs of the customers who
do not have required organizational capacity to implement advanced self-serving
services13. This is one of the core competencies of Information Technology sector of Egypt.
The service is made valuable enough to justify the price that is being charged for providing
the online service.

Key Concepts Discussed in the Paper

The aim of this research is to decipher facts about self-serving service that have impacted
the company competence in the Information Technology sector in Egypt. The key challenges,
growth and competitiveness are discussed in detail. Major driving forces that have positively
impacted the company competence in the Information Technology sector in Egypt that are
highlighted in this paper are its up-to-date infrastructure, multilingual talented labor at competitive
prices, business environment that is attractive to Multi National Companies, strong government
support and prioritization of the sector, a central geographical location and strong focus on
Research and Development, entrepreneurship and innovation. Contribution of Information
Technology sector to the economic growth and development of Egypt is clarified through literature
review. Other external environmental factors that have a significant impact on IT sector include
geographical location of the country, business environment, tax reforms, customer reforms,
financial sector reforms and number of projects that are started as an outcome of investment in

11
Khosrowpour, Mehdi. Managing Information Technology in a Global Economy. London: Idea Group
Publishing; 2012.
12
Goswami, Arti Grover, Aaditya Mattoo and Sebastian Saez. Exporting Services: A Developing Country
Perspective. Washingtion: The World Bank; 2012.
13
Abdulla, Rasha A. . The Internet in the Arab World: Egypt and Beyond. New York: Peter Lang Publishing;
2007.
7
research and development14. External15 environment refers to every aspect outside the boundary
of the organization that can affect it.

Key Challenges
The key challenges faced by self-serving service that can negatively impact the
competence of companies in the Information Technology in Egypt are researched and solutions
are suggested in the conclusion that can reduce or eliminate the losses it incurs. Few of the
challenges that are researched in this paper are as follows:
Concerns about personal, property and data safety in Egypt exist. This can have a negative
influence on the self-serving service as people might feel reluctant to share their personal
information for availing any such service16.
Online services have gained a boom during the past few years and are still progressing
rapidly. The problem faced by IT companies in this scenario is that they are unable to pace
themselves with this growing industry. They lack the experts to handle the situation and
progress. This lack of wider pool of talent can lead to many problems for Information
Technology sector like higher salaries and lesser cost competiveness17.
SMEs use of IT is still limited in Egypt and this is a serious challenge that needs to be
monitored.

Advantages of Self-serving Service That Play a Positive Role in Increasing the

Company Competence in the Information Technology Sector
Many factors about online services that will be studied through this research that play a
positive role in increasing the company competence of Information Technology sector are as
follows:
Increased Credibility: the more advanced a firm is in providing self-serving services (online
service) to numerous organizations, the credibility will increase. Nowadays, with these
changed trends and technological advancement have made organizations more and more
concerned about evolving them technologically. If a company or an organisation doesn't
have a website, it doesn't exist. The more information and services an organisation
provides online, the more professional it appears to the public. Thus, increased credibility of
IT firms to provide up-to-date soft wares definitely affect their competence18.

14 Egypt Information Technology Report Q1 2012. Cairo: Business Monitor International (BMI); 2012.
15 Ricky W. Griffin, Management, New Delhi: Biztantra; 2005.
16 Egypt Information Technology Report Q1 2012. Cairo: Business Monitor International (BMI); 2012.
17 ibid
18
Rajaraman, V. Introduction to Information Technology. New Delhi: Prentice Hall; 2003.
8
 Increase exposure: increased exposure of organizations as well as individuals to numerous
online services definitely increases the company competence in the Information
Technology sector.
Greater quantity and quality of inquiries: online services have been playing a tremendous
role in answering the inquiries of people with better and advanced ways19. Companies with
increased and more technologically advanced online services will definitely gain a
competitive advantage in IT sector.
Reduce cost per contact: doing any kind of business through online services and internet is
much cheaper than any other form. Thus, this advantage of online service definitely gives
rise to the IT sector.
Increased access to your information: Online services can supply information 24 hours of
the day and 365 days of the year20. This huge advantage of online service surely makes
Information Technology sector far more competitive. It also provides an additional feature to
up-to-date any changes made in the information without much effort.
Maintain information that's "up to the minute" accurate: if we compare printed media with
online services, many interesting facts can be discussed. In printed media, updating any
piece of information is much more costly and time consuming as compared to updating info
through online services. Similarly, the information you tend to deliver in printed form can be
out of date even before you get it back from the printer but this is not the case in online
services21. Lastly, as people are viewing the same online source so there are no chances of
people viewing obsolete updates as compared to any form of printed info that people might
forget to replace with the new copy.
Printing cost can be saved.
Reduction in staff load and usage of telephone line: as online services are available for 24
hours of the day so the extra expense of calling people to provide info about updated
features of any service or the expense of staff hired to answer the queries of people can be
reduced22. This is surely a cost effective technique that can be very profitable at individual
as well as organizational level.

Other important factors about Information Technology sector of Egypt that will be analyzed
and seem to have a huge impact on the competence of this sector are as follows:

19
Doyle, Stephen. Understanding Information Technology. London: Stanley Thornes; 2000.
20 Rajaraman, V. Introduction to Information Technology. New Delhi: Prentice Hall; 2003.
21
Abdulla, Rasha A. . The Internet in the Arab World: Egypt and Beyond. New York: Peter Lang Publishing;
2007.
22 Khosrowpour, Mehdi. Managing Information Technology in a Global Economy. London: Idea Group
Publishing; 2012.
9
 The Ministry of Information Technology plans to invest in infrastructure, granting 75% of
Egyptian households access to internet at a speed of 2Mbps by 2015, and, by 2021,
increasing access to 90% of households at 25 Mbps23.
According to the IT Ministry's annual report, mobile penetration reached 115% in 2013,
while internet usage has grown at an annual rate of 10% from 2012 to 2013 to reach a
penetration rate of almost 40%.

These interesting facts about IT sector of Egypt will make the research much more effective
and help in obtaining desired results to prove the factors about self-serving service (online service)
that have played a significant role in impacting the competence of companies in the Information
Technology sector of Egypt. Main focus will be the role of online services but other aspects of IT
that back up online services or indirectly affect the competence of IT sector of Egypt will also be
researched in this paper to attain better and more precise results to draw conclusions.

23 Egypt Information Technology Report Q1 2012. Cairo: Business Monitor International (BMI); 2012.

10
 PROBLEM STATEMENT

Overview
The research design that will be used in this study to find out the impact of self-serving
service (online service) on the company competence in the Information Technology sector in Egypt
is based on cause and effect relationship. Dependent and independent variable are used to study
the cause that is responsible for bringing the change24. Independent variable is the cause that
brings a change whereas dependent variable is the result of the change caused by independent
variable25. In this study, self-serving service (online service) are the independent variables
whereas company competence in the Information Technology sector in Egypt is the dependent
variable. The impact of self-serving service (online service) on the company competence in the
Information Technology sector in Egypt is to be investigated. Many factors can impact the
competence of Information technology sector of Egypt but the factor that will be studied and
investigated in this research is self-serving service (online service). The online services that will be
studied in this research proposal include websites, e-banking, e-commerce, online stores,
entertainment, emails, online customer forum and e-finance.

Research Question
The impact of self-serving service (online service) on the company competence in the
Information Technology sector in Egypt

Hypothesis
Hypothesis testing is a method used in research in order to evaluate the strength of
evidence from the sample provides an outline for figuring out determinations related to the
population. It is a useful method that helps to check the reliability of the research to make
conclusions out of the observed findings in a sample under study26. The researcher frames a
hypothesis, collect relevant data from the sample population and then evaluates the data according
to the null and alternate hypothesis and concludes that whether he support the specific hypothesis.
Make sure that hypothesis is testable.

H 1 (the research/alternate hypothesis)

The self-serving service (online service) has an impact on the company competence in the
Information Technology sector in Egypt.

24 Kumar, Ranjit. Research Methodology, New Dehli: Pearson Education; 2009.

25 Ibid
26
Kothari, C. R. . Research Methodology: Methods and Techniques. London: Routledge; 2004.
11
H 0 (the null hypothesis)
The self-serving service (online service) does not have any impact on the company competence in
the Information Technology sector in Egypt.

Theoretical Framework (Model as Follows)

Online customer
forum (V4)
Entertainment (V2)
Websites (V3)

E-banking (V5)

E-commerce (V1)

Company Competence in
the IT sector in Egypt (V6)
Online Stores
(V6)

Emails (V8)
E-finance (V7)

V1-V8 is Independent Variables

V9 is Dependent Variable

12
 OBJECTIVES AND AIMS

Overall Objective
The overall objective of this research is to find out the impact of self-serving service (online
service) on the company competence in the Information Technology sector in Egypt. As Egypt has
made tremendous progress in the field of technology that has benefitted its economy in numerous
ways like growth in GDP, so the research aims to find out the reasons, specifically in context of
self-serving service (online service) that have increased its company competence in the
Information Technology sector. The major challenges and negative impacts faced by this sector in
general as well as particularly in context of self-serving service (online service) will be studied to
have better and more accurate results out of the research. The research is based on cause and
effect relationship. Dependent and independent variable are used to study the cause that is
responsible for bringing the change. Thus, self-serving service (online service) is the independent
variable, whereas, company competence in the Information Technology sector in Egypt is the
dependent variable. The online services that will be studied in this research proposal include
websites, e-banking, e-commerce, emails and e-finance. These are all independent variables.

Specific Aims
The aim of this study is to deduce accurate results for the topic under study by using
accurate means of data collection and then analyzing the data properly. The research focuses on
all the facts that can directly affect the Information Technology sector in context of self-serving
service (online service) or can back up the independent variable to impact the dependent variable.
The research intends to find accurate result while considering the limitations of the study,
presenting the findings clearly in the form of charts and tables to make accurate analysis, making
appropriate recommendations without exceeding the scope of study and to organize the findings
and results logically to reach a solid conclusion. Additional facts and figures from the annual
Information Technology reports of Egypt will be analyzed in order to prove the facts and figures
that have emerged as a result of the research conducted.

13
 BACKGROUND AND SIGNIFICANCE
The aim of this research is to decipher facts about self-serving service that have impacted
the company competence in the Information Technology sector in Egypt. Despite of massive
uprising in Egypt in January 2011 that overthrew the former regime, Information Technology
industry grew at an astonishing double-digit rate27. The tremendous improvement in demographics
and development in information and communication technology infrastructure has benefited the IT
industry of the country.
With the growth and advancement in the field of technology, customers have become more
interested in gaining information as a result of which businesses are bound to evolve themselves
technologically to run their daily routine activities which in turn has increased the demand for more
sophisticated customer service28. This factor has greatly enhanced the competence of Information
Technology sector across the globe. With this increased demand of tech hungry customers, many
companies are turning to IT companies in order to upgrade their systems according to the
demands of todays technologically advanced world.

Internet in Egypt
Egypt is among the progressing nations of the world that have advanced themselves in all
filed including technology. In the past one decade, internet users have reached 44 % of the
population. The huge investment by the government of Egypt in internet and technology has
boosted this trend of internet usage in the life of every individual of Egypt. Government is investing
in three areas to further boost the Information Technology industry, which are as follows:
Subsidizing Internet-related technology and Internet access
Provide Internet training for the general population and for businesses in order to build skills
and increase proficiency29.
Introduce Arabic-language Internet content in order to broaden the reach of the Internet30.

The demographics of Internet usage in Egypt show that more than 45% of the individuals which
are between (16 25 years), 36% of them spend more than eight hours per day online31.

27
Egypt Information Technology Report Q1 2012. Cairo: Business Monitor International (BMI); 2012.
28
Collier, Marsha . The Ultimate Online Customer Service Guide: How to Connect with your
customers to sell more. New York: John Wiley and Sons; 2011.
29
Abdulla, Rasha A. The Internet in the Arab World: Egypt and Beyond. New York: Peter Lang Publishing;
2007.
30
Russell, Mona L. Egypt. New York: Congress Cataloging Press; 2013.
31
Abdulla, Rasha A. The Internet in the Arab World: Egypt and Beyond. New York: Peter Lang Publishing;
2007.
14
Social networking media has also gained significance in Egypt. The number of Facebook users in
Egypt almost tripled from pre-revolution levels (roughly 4 million accounts at year-end 2010) to
April 2013 (more than 14 million accounts), with the vast majority (75%) under age 3032.

Background of Information Technology Sector of Egypt

The driving factors that have helped the IT industry of Egypt to increase its competence are as
follows:

Cost Competitiveness
Egypt is cost competitive basically due to its relatively low cost of skilled human resources
and the competitive prices of real estate, electricity and telecom. The workforce in Egypt is
relatively young that makes it more competitive and helps it to improve its technology33. The total
number of multilingual and suitable talent pool that is willing to work in the BPO in Cairo is
estimated to be at least 24,000. Combined with its solid base of IT and technical skills, this
provides Egypt with a strong critical mass of talents available to the global BPO industry34.

Geographical Location
It acts as a bridge between East and West, North and South. Thus, its location helps it to enjoy
access to various markets of the world that in turn increase the competence of its overall industry
as well as Information Technology sector35.

World-class Telecommunications Infrastructure and Services

Egypt has a high class well established infrastructure that has helped the country to progress in all
fields. Currently, Egypt enjoys high-quality network facilities that are built around a world-class
infrastructure, including 10 gb/s optical fiber and 2.5 gb/s rings, delivering services over a Public
Switched Telephone Network (PSTN). Mobile and packet-based networks spread across the
country36.

Focus on Research and Development, Entrepreneurship and Innovation

Research and development is a necessary measure that needs to be adopted in the Information
Technology sector for continuous growth and development of the country. Few of the research and

32 Russell, Mona L. Egypt. New York: Congress Cataloging Press; 2013.

33
Danet, Brenda and Susan C. Herring. The Multilingual Internet: Language, Culture, and
Communication Online. New York: Osford University Press; 2007.
34 Ibid
35
The Report: Egypt 2011. Business Report. London: Oxford Business Group; 2011.
36 Rezler, Tanya . Businesswire. 30 January 2012. 10 August 2013.
15
development projects of Egypt that are further enhancing the competence of Information
Technology sector are as follows:
Center of Excellence program
Technology Incubation Program
Technology Development Fund
Information Technology Academia Collaboration37
MED-IST Project
Map Information Technology Project
Cairo Microsoft Innovation Center
IBM Nanotechnology Center
IBM Academy

Key Challenges in the Way of Information Technology Industry of Egypt

In this era of global economic recession, Information Technology industry of Egypt has to prepare
itself for the challenges to not only maintain its powerful position in BPO but also to reach its target
of acquiring the position among the top five BPOs of the world. The major challenges faced by
Information Technology industry include:
Although online services have boosted the growth of Information Technology sector. It has
increased its competence tremendously but has also caused problems like intellectual
property rights and reducing security risks. Further progress in the infrastructure of the IT
industry is necessary to deal with this issue. Improving quality and prices of the online
service can play a positive role to deal with this challenge38.
Additionally, lack of wider pool of talent if the sector grows at faster rates than the talent
pool. This is a serious challenge which could lead to high salaries and lesser cost
competitiveness39.
There is a need to invest further in the development of human capital capable of using new
technologies, to promote the use of e-commerce, provide protection and security to users
under cyber laws and to continue investing in infrastructure40.
Limited use of Information Technology in Small and Medium Enterprises is a major issue
that needs to be monitored. . For enterprises to benefit from ICT adoption, the government
can encourage enterprises to use e-government services to improve the efficiency of their
operations. There is a need to adopt new policies to promote the IT industry.

37
Anonymous. EIA. 31 July 2013. 8 August 2013.
38 Ibid
39 Rajaraman, V. Introduction to Information Technology. New Delhi: Prentice Hall; 2003.
40 Ibid
16
E-Commerce
With the concept of Add to Cart option in online shopping, customer service in some form
became a part of e-commerce. E-commerce has become a central element in the economic growth
and the expansion of world trade.
Major Factors that Boosted E-Commerce are as follows:

Enhancing the Information Infrastructure

This involves improving access to telecommunications and Internet services at the price,
reliability, and speed levels needed for e-commerce41.
Building Trust for Users and Consumers of Electronic Commerce
The factors that helped in building trust for consumers of e-commerce are as follows:
Addressing principles for online business and information disclosure
handling consumer complaints
provision of effective dispute resolution
education and awareness
Global co-operation.

The Role of Websites in Increasing Competence of Information

Technology Sector
With the growth and advancement in technology across the globe, the customers have become
more and more aware and have thirst for knowledge gain. This trend in the customers has made
the businesses more concerned about implementing measures to become easily accessible to the
customers. Thus, website that is easily accessible to people across the globe is the easiest way to
deal with this situation. Additionally, its a low-cost method to approach the customers. If used
properly, a website can act as a resource for customer "self-help" and that means you may not
need as many employees to handle customer service requests by phone or mail. This mode of
communication with the technologically advance customers is available for 24 hours of the day and
365 days of the year. These advantages of website prompt the companies to approach Information
Technology industries to design a web site. This increased demand of industries has helped in
increasing the competence of Information Technology industry42

41 Russell, Mona L. Egypt. New York: Congress Cataloging Press; 2013.

42
Elmers, Sven. Egypt - Impacts & Concerns, Sustainability & Ecotourism, Industry
Responsibilities and Tourism Planning. Vaasa: Grin Verlag; 2009.
17
The Role of E-finance in Increasing Competence of Information
Technology Sector
E-finance-including investing, banking, mortgage lending, and insurance-will grow at a
dazzling rate in the coming years. It's a reflection of the spectacular growth of the Internet. In just
five years, the World Wide Web has gone from being terra incognita to becoming a ubiquitous
medium for transacting business, sharing information, and communicating with people all over the
world43. E-finance has greatly improved the competence of Information Technology centre because
of its increased demand. It has empowered consumers as well as businesses. It performs various
functions; few of them are as follows:
enabling reduced transaction costs
Speedily process documents online
Have instantaneous access to information44
Improve efficiency of business
Decrease the cost of internal business functions
Provide personalized information about consumers
Helps in one-to-one marketing

The Role of Online Customer Forum in Increasing Competence of

Information Technology Sector
The increased demand of online customer forums has played a significant role in improving
the competence of Information Technology sector of Egypt. Few of the features of online customer
forums that impel its demand in businesses are as follows:
Segmentation
Integrated Listserv
Email Engine
Mobile Applications
Search Engine
Analytics
Favourites
Auto Subscription
Limited Access for Partners
Terms of use
Event management

43
Arsalan, Ismail. Egypt, Positive Results from Knowledge Sharing and Modest Lending.
Washington: The World Bank; 2009.
44 Ibid
18
 The details about all these services will be discussed later in the complete research paper.

The Role of Entertainment in Increasing Competence of Information

Technology Sector
As technology is ruling the lives of every individual of all age groups so it has become a
necessary part of entertainment media. The number of Facebook users in Egypt almost tripled
from pre-revolution levels (roughly 4 million accounts at year-end 2010) to April 2013 (more than
14 million accounts), with the vast majority (75%) under age 3045. These mentioned facts clearly
indicate the role of entertainment in increasing the competence of Information Technology centre in
Egypt.

The Role of Online Stores in Increasing Competence of Information

Technology Sector
The benefits of online stores for businesses are as follows:
Reduced overheads cost
Lower marketing cost
Expanded geographical reach open business 24/7
Greater Flexibility
Broader potential customer base
Improved customer profiling
Increased visibility for business
These advantages of online sector clearly indicate the role of entertainment in increasing the
competence of Information Technology.

45 Russell, Mona L. Egypt. New York: Congress Cataloging Press; 2013.

19
 RESEARCH DESIGN AND METHODS

Overview
The research that is being conducted must be clear and precise, thus the data collected
must be logical and clear in order to attain rational results when data analysis is conducted. A
research project must clearly analyse all the variables involved in the study that forms the basis of
the research. The hypothesis must be clear and the conclusions attained must be obvious and
practical based on the collected data. The collection of the data must be impartial, and the
researcher must be prepared to agree to the result, even if it negates their thesis hypothesis. So in
order to attain desired and practical results out of the research, first step is the selection of
appropriate study sample. Additionally, data collection and data analysis strategies must be
implemented wisely to get effective and rational results.

Population and Study Sample

For getting accurate results from a research, population and study sample is of greatest
significance. One very simple rule that must be kept in mind while choosing study sample and
population is to be very specific in order to provide a clear and flawless understanding of the
applicability of the study to the readers. Thus, proper method of sampling needs to be
implemented. Selection of a procedure must be implemented to randomly select people in a way
that deliver perceptions and insights into the complete population under study. This can be done by
the following four methods:
Simple random sampling
Stratified sampling
Cluster sampling
Systematic sampling
On the contrary, non-random sampling technique is implemented in case random sampling is an
impractical option. The three methods of non-random sampling are:
Convenience sampling
Purposive sampling
Quota sampling

Convenience Sampling
In this method, taking whoever is willing to participate in the research46.

46
Zerde, Alpaslan and Richard Bowd. Participatory Research Methodologies: Development and Post-
Disaster/Conflict Reconstruction. Cambridge: Ashgate Publishing Limited; 2012.
20
Purposive Sampling
In this technique, individuals who fall in the clear criteria are taken as sample population47.

Quota Sampling
This method depends on interviewing or studying members of particular demographic subgroups48.

Population will be under graduate or post graduate students of Information Technology

related fields for this research.

Sample Size and Selection of Sample

Three useful tips while selecting a sample size include:
Collecting data must be low cost.
Data must be collected fast.
Sample population must be selected wisely in order to get accurate results.
Qualitative data collection techniques will be implemented in this research to collect and analyse
data. Qualitative data49 is information which does not present itself in numerical form and is
descriptive, appearing mostly in conversational or narrative form. Non-random sampling technique
will be implemented in this research. Purposive sampling technique will be used to figure out the
population that can help in getting desired results out of the research. The criteria set for sample
population will be under graduate or post graduate students of Information Technology related
fields. After figuring out the population, exact sample will be selected with the help of convenience
sampling i.e. taking whoever is willing to participate in the research.
Exact sample size will be determined with the help of the following technique:
First select the confidence level of your own choice.
In case the population size is finite, enter the population size
If you already know the estimate Proportion, or want to check the Relative Standard Error
of an existing estimate, fill in the Proportion. If left blank it will be assumed to be 0.5.
Fill in one of the Confidence Interval, Standard Error, Relative Standard Error or Sample Size. Make
sure the bullet point corresponding to the one the researcher wishes to specify is selected50.

47
Lyon, Fergus, Guido Mllering and Saunders Mark . Handbook of Research Methods on Trust. London:
Edward Elgar Publishers; 2012.
48 Ibid
49
Chilisa, Bagele . Indigenous Research Methodologies. Washington: SAGE; 2012.
50
Panneerselvam, R. . Research Methodology. New Delhi: Prentice Hall, 2004.

21
Confidence Level

Confidence level refers to the extent of certainty or conviction with which the researcher will
estimate the exact population value. In most of the cases, 95 % or 99 % is selected51.

Population Size
Population Size refers to the total number of individuals or groups about which information is
required52.

Proportion
Proportion refers to the expected proportion of the population that contains the attributes and
characteristics that the researcher is expecting and estimating out of the search result. Educated
guess usually helps in determining the population. If the proportion is unknown and educated
guess is impractical than proportion is fixed to 0.5 i.e. 50 %53.

Confidence Interval
This refers to the desired level of accuracy of the estimate. The confidence interval value is
expressed as a proportion, meaning that if you want the result to be accurate within 5 percentage
points, then you should enter 0.0554.

Confidence Interval: Upper and Lower

These are the upper and lower boundaries of the confidence interval. For instance, if the proportion
is taken to be 0.5 then the upper and lower boundaries will be 0.5 +/- 0.05. Thus the confidence
interval will be 0.45 to 0.5555.

Standard Error
It basically indicates the sampling error, i.e. the degree to which estimate may vary from the true
value.

Relative Standard Error

Standard error when expressed as a percentage of the estimate, then it is called as relative
standard error.

51
Khan. Research Methodology. New Delhi: APH Publishing Corporation; 2008.
52 Ibid
53 Chilisa, Bagele . Indigenous Research Methodologies. Washington: SAGE; 2012.
54 Ibid
55
Kothari, C. R. Research Methodology: Methods and Techniques. New Delhi: Congress Cataloguing
Press; 2004.
22
Sample Size
This refers to the number of individuals or groups required to respond (not just the number
approached) to achieve the required level of accuracy.

Formula Used to Calculate the Sample Size

Z 2 * (p) * (1-p)
Sample Size =
c2

Where:
Z = Z value (e.g. 1.96 for 95% confidence level)
p = percentage picking a choice, expressed as decimal
(.5 used for sample size needed)
c = confidence interval, expressed as decimal
(e.g., .04 = 4)

Sources of Data
Primary sources used in this study are questionnaires filled by under graduate or post
graduate students of Information Technology related fields and case studies. Secondary sources
used are Information Technology related annual reports of Egypt and websites. Journals, articles,
annual reports and books are referred for literature review.

Collection of Data
In this study, data is collected from two sources, i.e. primary sources and secondary
sources. Primary sources refers to unpublished first hand sources of data collection such as
interviews etc. whereas secondary sources can be published documents and can be called as
second hand data as well56. Primary sources used in this study are questionnaires filled by under
graduate or post graduate students of Information Technology related fields and case studies.
Secondary sources used are Information Technology related annual reports of Egypt and websites.
Journals, articles, annual reports and books are referred for literature review.

56 Kumar, Ranjit. Research Methodology. New Delhi: Pearson Education; 2009.

23
Data Analysis Strategies
The most appropriate strategy that will be used to analyse the collected data will be Excel.
Additionally text from authentic annual reports on Information Technology sector of Egypt will be
used to further support and verify the data collected from the questionnaire analysis. Literature
review will also play a significant role to deduce authentic results by supporting the facts and
figures that are brought to light after data analysis.

Timeframes

24
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25
Zerde, Alpaslan and Richard Bowd. Participatory Research Methodologies: Development and
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26