Information and Communication Technology (ICT) is an integral part of business management now-a-day. It is inevitable for the smooth running of business irrespective of size and complexity all over the world. Due to the rapid development of ICT and its huge use in all spheres of our lives, businesses are also influenced by it. Now, businesses are managing their resources by using ICT support that is helping them to perform their tasks faster and accurate than before. But the developing countries like Bangladesh are still struggling to introduce ICT supports in all areas of businesses. But due to a very strong culture at work place, this effort is hindered substantially. Therefore, this paper aims at identifying the present status of the use of ICT in business management and its challenges it faces. Secondary data have been primarily used for conducting this study which was collected from the different business reports and the journal papers. An experience survey was also conducted among the senior administrators of the business houses were also included in the study. Results show that the use of ICT is very low in the small and medium business enterprises while the large businesses houses are using ICT supports. Results also show that the use of ICT primarily depends on the complexity and the nature of the business. The entrepreneurs who have ICT literacy, they are mostly using ICT supports in the management of their businesses. This study suggests that the business houses in Bangladesh should use ICT support in order to increase the efficiency at their work. But this is often depends on the ICT infrastructure of the country as a whole.
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The Use of Information and Communication Technology (ICT) and Business Management: Contemporary Issues and Challenges
1. Electronic copy available at: https://ssrn.com/abstract=2856262
The Use of Information and Communication Technology
(ICT) and Business Management: Contemporary Issues and
Challenges
Dr. Nazrul Islam
Professor & Dean, School of Business
Uttara University, Dhaka, Bangladesh
Email: nazrulku@gmail.com
Abstract
Information and Communication Technology (ICT) is an integral part of business management
now-a-day. It is inevitable for the smooth running of business irrespective of size and complexity
all over the world. Due to the rapid development of ICT and its huge use in all spheres of our
lives, businesses are also influenced by it. Now, businesses are managing their resources by
using ICT support that is helping them to perform their tasks faster and accurate than before. But
the developing countries like Bangladesh are still struggling to introduce ICT supports in all
areas of businesses. But due to a very strong culture at work place, this effort is hindered
substantially. Therefore, this paper aims at identifying the present status of the use of ICT in
business management and its challenges it faces. Secondary data have been primarily used for
conducting this study which was collected from the different business reports and the journal
papers. An experience survey was also conducted among the senior administrators of the
business houses were also included in the study. Results show that the use of ICT is very low in
the small and medium business enterprises while the large businesses houses are using ICT
supports. Results also show that the use of ICT primarily depends on the complexity and the
nature of the business. The entrepreneurs who have ICT literacy, they are mostly using ICT
supports in the management of their businesses. This study suggests that the business houses in
Bangladesh should use ICT support in order to increase the efficiency at their work. But this is
often depends on the ICT infrastructure of the country as a whole.
Electronic copy available at: https://ssrn.com/abstract=2856262
2. Electronic copy available at: https://ssrn.com/abstract=2856262
The Use of Information and Communication Technology
(ICT) and Business Management: Contemporary Issues and
Challenges
1. Background
Management of business is a very much challenging task now a day. It is due to the increase of
human complexity at work. The efficiency of the management of business substantially depends
on the instruments management uses. If the work project is labor-intensive, the manager is
unable to use communication technology. But if it is capital-intensive, the manager is in a
position to use information and communication technology (ICT) that brings efficiency in
managing its activities. Information Communication Technology (ICT) includes any type of
software and software related activities and solutions such as ICT services, ICT applications, and
software products and embedded software. Examples of ICT solutions are customized software
development, mobile application development, website design and development and the design
of graphs and animations. As such, Information and Communication Technology (ICT) is an
integral part of business management in any country of the world. It is inevitable for the smooth
functioning of business irrespective of size and complexity especially in Bangladesh where the
quality of work is a concern.
Literature review shows that the use of ICT in SME sector is more important where little profits
might be doubled (Plumb Lon, Zamfir Andreea, 2011). The study reveals that ICT should be used
more in SMEs within the sector of services. This conclusion is based on several premises: (1)
within the knowledge-based economy, SMEs from the sector of services are facing both
opportunities and challenges due to the information and communication technologies
development; (2) ICT are today key tools in management processes; (3) ICT could improve
managerial practices of SMEs within the sector of services; (4) SMEs could use ICT in order
to grow and to become more innovative; (5) ICT provides many benefits for SMEs within
the sector of services; (6) the costs of ICT adoption in SMEs within the sector of services
have a good potential to decrease. Findings could give good reasons for intensifying the
efforts of promoting the use of ICT in SMEs within the sector of services and attempting to
change mentalities. SMEs within the sector of services should change their managerial
practices by integrating ICT in their day-to-day activity
Rafi Ashrafi and Muhammed Murtaza, (2008) identified that ICT usage within SMEs in Oman is
moderate in common technologies, but limited in the more sophisticated technologies such as
wireless, data storage and network security solutions. It was noticed that Omani SMEs are taking
a comprehensive approach to their ICT investment focusing on both strategic and operational
aspects of their business. The results of our study show that Omani SMEs are making reasonable
investment in ICT and that there is a modest competition among the SMEs. The main driving
forces for ICT investment was to provide better and faster customer service, to stay ahead of
competition and following top management strategy. The competitive strategy for the majority of
SMEs was to provide high quality products and services to their customers and to establish long
Electronic copy available at: https://ssrn.com/abstract=2856262
3. term relationships with customers. Nearly half of the respondents have realized business benefits
of ICT adoption such as better customer relationships, increase in revenue and in reducing costs.
Two thirds of the respondents are very positive about increasing their business performance in
the future. With regard to barriers to ICT investment, three fourths of the firms feel that a lack of
necessary internal skills is a major barrier. More than half of the respondents feel that the costs of
implementation are too high. Lack of availability of relevant information and advice on suitable
and effective technologies is also one of the major barriers. Other barriers include SMEs having
no time to implement ICT projects, lack of top management support, bad experience in the past
and government regulations and requirements. These findings are consistent with other studies
e.g. (Harindranath et al 2008). This emphasizes the need for more training facilities in ICT for
SMEs, measures to provide ICT products and services at an affordable cost, and availability of
free professional advice and consulting at reasonable cost to SMEs. Our findings therefore have
important implication for policy aimed at ICT adoption and use by SMEs.
The use of ICT to improve business growth strategies of SMEs in Ghana The role of ICT in
improving business delivery services and innovations in SME is farfetched ICT provides the
bedrock on which SMEs can build their business information systems aimed at improving their
business processes, customer relations and efficient delivery of goods and services to satisfy the
needs of cherished customers (Ben Ebo Attom, 2010). Providing a proper field of innovation in
small industries for creates development technology with local conditions is considering the
planning requirements of the oriented-knowledge economy changing. ICT is the solution
(Shahram Gilaninia, Seyyed Javad Mousavian, 2012). Another study concluded that According
to the results, a perceived benefit has a strong, significant relation to ICT adoption. It is expected
since past literature has consistently shown that perceived benefit has a significant and positive
influence on the ICT adoption (Syed Shah Alam, Mohd. Kamal Mohammad Noor, 2011).
Another study reported that there is a significant benefit of ICT investment on the company
profitability (Adewoye, J.O and Akanbi, T. A,. 2012).
SMEs with large number of administrative applications readily support ICTs adoption as a tool
for management control, operational control and administration (Gyaneshwar Singh Kushwaha,
2011). It also identified that the SMEs in the developing nations should integrate into the global
supply chain, bid for outsourcing businesses, and increases their own productivity. The key for
SMEs is that the information and communication technology provides so many options and
avenues to take advantage of in a way that big business just can't or doesn't see value in. SMEs
with large number of administrative applications readily support ICTs adoption as a tool for
management control, operational control and administration.
It is certain that the adoption of ICT in Nigerian SMEs help these SMEs to grow and increase
their competitiveness. The study confirms that ICT adoption in Nigerian SMEs can assist them to
easily process and store information, communicate with customers and business partners and so
on thereby assisting in their development process (Idisemi Apulu & Ann Latham, 2011).
The Malaysian study found empirical evidence to support the notion that, despite the vast
majority of the firms already using computers in their organizations and being connected to the
internet are impacted by ICT shortages such as employee computer skills, lack of adoption of
web applications, databases, and other business applications. Another interesting finding is that,
despite the majority of SMEs surveyed that use the internet to interact with their suppliers; the
Electronic copy available at: https://ssrn.com/abstract=2856262
4. same SMEs were not 15keen to use the internet for transactions with financial institutions due to
perceived concerns over privacy and security. This study also found that there are a number of
factors that hinder SMEs willingness to use ICT in their organization. Among the major
hindrances are finance, employee education levels, in particular, in relation to ICT skills, the
high cost of ICT infrastructure and non availability of skilled human capital present major
challenges for Malaysian SMEs in the adoption of ICT (Ali S. Saleh, Lois Bargess, 2009).
There is no significant impact seem on either e-business and on HRM strategies of the
organizations of Pakistan. The probable reasons behind the low adaption of e-business and
implementation on HRM strategies may vary significantly such as awareness, annual income
rate, social and cultural influences. They seem satisfied with the traditional method for
management strategies. They seem more comfortable without HRMIS in their organizations
(Asma Moomal, Maslin Masrom, (2014). Keeping this in mind, this study aims at identifying the
contemporary issues and challenges of introducing ICT in business of Bangladesh.
2. Objectives of the Study
The objective of this study is to identify the challenges for introducing ICT in business
management in Bangladesh. The specific objectives are outlined below.
i. To describe the management systems of business in Bangladesh;
ii. to identify the impact issues and challenges related to the use of ICT on business
management in Bangladesh;
iii. To give some suggestions to improve the probability for introducing ICT in business
management.
3. Research Methods
This study attempts to identify the challenges and issues for using ICT in business management
in Bangladesh. To conduct the study, primary and secondary sources were used. Primary data
were collected from the experience survey and the secondary data were collected from the books,
magazines, research monographs and national and international journals. For surveying
experienced persons, a checklist was used for the items related to the use of ICT and business
management process in Bangladesh. Only descriptive statistics1
were used in this study.
4. Issues Concerning ICT-Use in Business Management
In old days of Bangladesh, land properties and their wealth were considered very important.
Later on, industrial revolution changed this concept and introduced technology at the
manufacturing level of the companies and mass production started. In recent years, information
revolution changed the whole idea about the wealth management systems in Bangladesh which is
now called information and communication technology. Management of business in Bangladesh
1
Descriptive statistics includes statistical procedures that we use to describe the population we are studying. The
data could be collected from either a sample or a population, but the results help us organize and describe data.
Descriptive statistics can only be used to describe the group that is being studying. That is, the results cannot be
generalized to any larger group.
Electronic copy available at: https://ssrn.com/abstract=2856262
5. is almost traditional in nature. Most of the companies are still using traditional systems for
controlling the activities of the business. However, this situation has been changing very rapidly.
Now, large corporations are using sophisticated ICT in managing their activities. But the small
and medium enterprises are hardly using the latest ICT support in managing their activities. This
revolution encouraged the managers to collect, store, process and distribute information. This is
nothing but the combination of data and computer systems in order to convert input into output
which is called information. Some important issues concerning ICT are very important for the
policymaker of Bangladesh.
4.1 E- Governance
Bangladesh government took the initiative to implement e-governance in 2001, but the
implementation of e-Governance in Bangladesh is not up to the mark and the government is not
getting the full benefits of e-Governance yet for many reasons. The term e-Governance is the
effective and efficient use of modern information and communication Technologies (ICTs) such
as Internet, LANs and Mobile Phones to improve the activities of public sector organizations
with a view to establish good and transparent governance and to promote democracy for any
country. The final objective of e-Governance is to create good governance (Alam, M.J., 2012).
The features of good governance can be identified as follows: (i) Transparency (ii) Efficiency
(iii) Effectiveness (iv) Accountability (v) Justice (vi) Reliability (vii) Participatory Democracy
(viii) Accessibility and (ix) Equity. Generally, e-governance is composed of three components
such as, government, citizen and business houses. This means, governance to government,
governance to citizens and governance to business.
Governance to government is the non-commercial communication between Government
organizations, departments and authorities and other Government organizations, departments,
and authorities. For example, city corporation yearly budget depend on the government.
Governance to citizens is the communication process of individual citizen with the government
and its different bodies and departments. For example, payment of utility bills such as, electric
bill payment system using mobile phone is a common. Payment of gas and other bills like
payment to Bangladesh Road Transport Authority by the individual. Any citizen can see the
driving license exam’s result or download the driving licenses Form using Bangladesh Road
Transport Authority. Government can develop and use more website for all sectors of
Bangladesh to involve the citizens of the country to make the successful e-Governance in the
country. Governance to business is the interaction between the government and the commercial
or business houses to get the businesses information in order to form or run the business. This
interaction also may involve many reasons such as, to establish a company, NGOs or others
commercial business has to use different types of forms. Most common example is corporate tax
paying system to the government using National Board of Revenue or applying for trade license
from the government to run the business through internet using Office of the Registrar of Joint
Stock Companies from the website. In Bangladesh, there are some problems to implement e-
governance at the national levels. The problems are (i) internet connectivity (ii) internet network
(iii) security issues (iv) central database problem (v) problems in financial sectors (vi) use of
Electronic copy available at: https://ssrn.com/abstract=2856262
6. computer (vii) automation in government sector agencies (viii) financial problems (ix) public
awareness about the government portal and (x) lack of training of the users.
4.2 E-Commerce
E-commerce refers to the buying and selling products and services over electronic systems
through internet and other computer networks. E-commerce involves digitally enabled
commercial transactions among the organizations and the customers. The most popular medium
of e-commerce are (i) electronic data interchange (ii) electronic mail (e-mail) (iii) world wide
web (WWW) (iv) internet applications and (v) network applications. The common applications
of e-commerce are (i) e-mail (ii) enterprise content management (iii) instant messaging (iv)
newsgroups (v) online shopping and order tracking and (vi) online banking. Now, if we look at
Bangladesh, we’ll see that the present situation is not favorable for e-commerce in Bangladesh.
The reasons are concerned with the overall development of ICT in the country.
4.3 Management Information Systems (MIS)
Management information system (MIS) broadly refers to a computer-based system that provides
managers with the tools to organize, evaluate and efficiently manage departments within an
organization. In order to provide past, present and prediction information, a management
information system can include software that helps in decision making, data resources such as
databases, the hardware resources of a system, decision support systems, people management
and project management applications, and any computerized processes that enable the
department to run efficiently.
Today, MIS is used in various contexts and includes but is not limited to: decision support
systems, resource and people management applications, project management, and database
retrieval applications. Although the boundaries have become fuzzy over the years, typically MIS
still covers systems that are critical to the company's ability to survive, including accounting and
order entry. Upper management should not lose sight of this fact. In many businesses, MIS
handles legacy software and hardware, coded by programmers long since retired, who left no
documentation for the systems. The enterprise upgrades or modernizes these systems only very
carefully, and with high appreciation of the risks involved. But if we look at Bangladesh and its
businesses we’ll see that MIS is hardly functional in the country. Business houses are not using
fully automated MIS systems in Bangladesh and still suing traditional systems in controlling
their and managing their activities.
4.4 Farming and Agricultural Development
Bangladesh has a primarily agrarian economy. Agriculture is the single largest producing sector
of the economy since it comprises about 18.6% of the country's GDP and employs around 45%
of the total labor force. The performance of this sector has an overwhelming impact on major
macroeconomic objectives like employment generation, poverty alleviation, human resources
development and food security.
Electronic copy available at: https://ssrn.com/abstract=2856262
7. A result from interview and personal observation suggests that the telecentre projects had limited
impacts in terms of meeting some crucial agricultural information needs. Mobile telephony,
computers and internet connectivity have the potential to deliver the information. However, the
information content and the applications need to be developed through a bottom up approach in
order to achieve the objectives of meeting the information needs of farmers. The reasons could
be attributed by the (i) Lack of use of technology in the production (ii) Financial and structural
relationship (iii) Natural Calamities (iv) Lack of bargaining power of the farmers (v) Lack of
productivity of the farmers (vi) Price and demand fluctuation in input market (vii) Lack of
pricing information for the output market and (viii) Lack of agricultural knowledge.
4.5 Health and Hygiene
In developing countries like Bangladesh, preventable diseases and premature deaths still inflict a
high toll. Inequity of access to basic health services affects distinct regions, communities, and
social groups. Under-financing of the health sector in most countries has led to quantitative and
qualitative deficiencies in service delivery and to growing gaps in facility and equipment upkeep.
Inefficient allocation of scarce resources and lack of coordination among key stakeholders have
made duplication of efforts, overlapping responsibilities, and resource wastage common and
troublesome problems.
Improving the health of individuals and communities, and strengthening health systems, disease
detection and prevention are crucial to development and poverty reduction. ICTs have the
potential to impact almost every aspect of the health sector. In public health, information
management and communication processes are pivotal, and are facilitated or limited by available
ICTs.
Research shows that that business model of Bangladesh are more likely to target a better-off
population, who can either pay a fee for the services, or enable a website to generate revenue
from selling goods or services online. Although it is possible to conceive of the use of a platform
to provide lower cost services to the poor, the only such models available in Bangladesh involve
donor funding.
4.6 Environment Development
Bangladesh is one of the countries most vulnerable to climate change. It has three big river
systems, a large deltaic floodplain, and a long coast, all susceptible to frequent floods, cyclones,
tidal surges, salinity intrusion, and sea-level rise. Different areas of Bangladesh have different
types of environmental threats. For example, the long coastal area on the South experience high
salinity, inundation of lands by tidal surges, cyclone or sea level rise, while some upland area at
the northwest, northeast and southeast experience heavy rainfall in some years. The
Northwestern region is affected by drought and low rainfall (Mallick, Rahman, 2010). The
private sector in Bangladesh has a tendency to consider environment protection as a corporate
social responsibility but not as a mode of doing business. This takes environment more as a
charitable concern rather than part of sustainable development. There is a general sense amongst
private sector bodies in Bangladesh that businesses would lose their competitive edge if
Electronic copy available at: https://ssrn.com/abstract=2856262
8. environmental concerns are integrated into everyday practice. Few companies in Bangladesh
have taken the initiative regarding their e-waste. Policies in Bangladesh are developed from a
sectoral perspective. This causes problems for environment policy development, which is likely
to be a cross-sectoral issue. For example, the Environment Policy of Bangladesh, 1992, covered
almost 15 sectors including agriculture, industry, energy, health, and land etc.
4.7 Development of Manpower
Bangladesh is one of the rising countries in the world from economic and human development
perspective. Information Communication Technology (ICT) plays a significant role in
developing human capital through bringing a revolutionary change in education system specially
focusing on the development of rural schools by the use of ICT in imparting education to the
students of primary and secondary levels. The government of Bangladesh has taken some
initiatives to integrate ICT in education system and one of these is to digitize the academic books
both in primary and secondary levels and distribute these across the country so that the students
in rural areas can download the books from the Internet at free of cost and thereby facilitate the
education system. Government also provides training to the teachers and other authority of the
rural school to encourage them to use ICT for both academic and administrative purposes. This
paper attempts to identify the various impacts of ICT on education systems focusing on the rural
schools in Bangladesh (Arifur, et. al., 2013).
4.8 Infrastructure Development
Bangladesh is a country of a thousand rivers, large and small, and most of its territory is
regularly flooded during the monsoon season. This fact makes it extremely difficult and
expensive to build modern transportation and communication networks. The river boats and
ferries traditionally used for transportation are cheap, but slow and inefficient. The situation is
further complicated by the fact that the Bangladeshi government has sharply limited resources
not only for building new infrastructure but also for maintaining the existing one. From the
colonial era Bangladesh inherited underdeveloped and unevenly distributed infrastructure and
transportation networks. Poor and inefficient infrastructure undermined the economic
development in the country, and only recently has the government been able to address the
problem systematically and channel investments towards expanding its highways, railroads,
seaports, and airports. More recently, with international assistance the government has also
started to modernize its telecommunications infrastructure and introduce the Internet.
5. Challenges of Using ICT in Business Management
However, for the development and introduce ICT in business management there are number of
barriers which are often beyond the control of the mangers. The important barriers for the
development of ICT are outlined below.
5.1 Poor Telecommunication Infrastructure
Electronic copy available at: https://ssrn.com/abstract=2856262
9. Bangladesh was one of the first countries in South Asia to allow private participation in its
telecommunications sector. Initial licenses were issued in 1989 and private provision of services
commenced in 1993. Since then, however, the pace of reforms has been slow, and the country
has fallen behind most of its neighbors with regard to performance in this sector.
Telecommunication services in Bangladesh are underdeveloped and provide one of the lowest
rates of telephone ownership per 1,000 inhabitants in the world. The largest company is the
Bangladesh Telegraph and Telephone Board (BTTB), which enjoyed a state monopoly until
1972, when private operators were allowed. As most of the telephone service uses outdated
analogue technology, the quality of telecommunication services is often poor and in need of
upgrades. In 2000 the country had a mere 490,000 telephone lines and 52,000 mobile phones
serving 129 million people. The government is aiming to provide telephone coverage of remote
towns and villages that until now have had no telephone connections. With international
assistance and increasing private investments, Bangladesh is upgrading its telecommunication
system, replacing analogue technology with digital, introducing the Internet and e-mail services,
and expanding cellular mobile services.
The problems are concerning delays in carrying out National Telecommunications Policy (1998);
restructuring of the Bangladesh Telegraph and Telephone Board (BTTB); lack of interconnection
capacity between BTTB and private cellular companies; liberalization of international long-
distance services; rebalancing of tariffs; and obstacles to universal access.
5.2 Inadequate Skilled Manpower
Lack of Domestic Employment Opportunity of ICT Professionals
Poor Quality in Knowledge of Science, Math and English
Inadequate Incentive for IT Development
Very Strong Culture of the Established Work Practices
Highly Anchored Mindset
5. Conclusions and Recommendations
1. Periodic training in the form of workshops and sensitization programs on the benefits and
the use ICT resources in business growth strategies should be organized by National
Board for Small Scale Industries (NBSSI) for SME operators to create more awareness in
order to enhance their preparedness to institute ICT programs aimed at improving their
business operations;
2. There should be a comprehensive effort to institute ICT training programs at the various
levels of the educational hierarchy. ICT should also be made compulsory at the basic and
second cycle schools to train more students to increase ICT technical trainees and
professionals to fill the ICT job market;
3. The government on its part, initiate special incentive schemes such as tax holidays, free
computers and other ICT resources to encourage SME operators to readily accept to use
these resources to improve their business activities;
Electronic copy available at: https://ssrn.com/abstract=2856262
10. 4. A special loan scheme should be initiated jointly by the government and the various
commercial and investment banks to provide easy access to credit facilities that will
absorb the initial high investment cost of implementing ICT project; and
5. Finally, SME operators, as a matter of urgency should outsource their ICT delivery
systems by engaging ICT consultants in order to circumvent the problem of funding
relating to the setting up of their own ICT system which usually requires huge initial
capital outlay.
Prospects
Instant access to multitude if information available through the internet from countless Web sites
and quick decision making using such information are essential to be competitive in the present
globalization era. The present generation must adapt to new situations some of which are
outlined below:
- Instant accesses to information
- Quick decision making
- Efficient management
- Effective governance
- Global culture and global society
- Speeder research and development
- Faster changing in human activities
- Transparency through ICT
- Diminishing importance of political boundary etc.
Digital Divide and Bangladesh
With about 30% of its population, most of the people of Bangladesh live in villages where
amenities for ICT are almost nonexistent. Noticeable digital divide in the country can be
observed in the following areas:
- Urban and rural populations
- Dhaka and the rest of the country
- Different educational streams
- Rich population and poor population
- Male & female
- Main stream and tribal population
- Lack of education
- GOB & private organization
6. References
1. Arifur Rahman Khan, Reza Shahbaz Hadi, Dr. Md. Mahfuz Ashraf, (2013), The Impact
of ICT on Education: A Study on Rural Schools, Communications in Information Science
and Management Engineering, Aug. 2013, Vol. 3 Issue. 8, pp. 367-373.
Electronic copy available at: https://ssrn.com/abstract=2856262
11. 2. Alam, M.J., (2012), E-Governance in Bangladesh: Present Problems and Possible
Suggestions for Future Development, International Journal of Applied Information
Systems (IJAIS) - ISSN: 2249 – 0868, Foundation of Computer Science FCS, New York,
USA, Volume 4, No.8, December 2012, www.ijais.org
3. D. Mallick and A. Rahman, (2010), National policy and programs for adaptation to
climate change in Bangladesh,
http://irri.org/climatedocs/presentation_Lists/Docs/6_Mallick.pdf
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Appendices
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