Applications of information technology (IT) for small and medium enterprises (SMEs) in Taiwan is a costly initiative. Not only that it costs the company to develop it, it requires significant business process change in order to leverage it for business benefits. With limited resources and expertise of SMEs, the research found that most of surveyed SMEs took the Internet as a tool to improve existing business process. With investigating company?s profile, current situation, the degree of Informatization, and overall picture of IT application, there is two aspects of performance of IT applications concerned: how much can be saved and what new chances can be created? The study also revealed that SMEs in Taiwan lack of strategy and competence in the E-business area and lack of management, education and involvement of the human resource dimension. 20% of the companies said they had a strategy for E-business but most of them were not explicit formulated. The study indicates that some SMEs are working hard on applying IT for cost efficiency but as indicated above without formulated strategies. Finally, the research showed that the four types of IT applications are all following different ways along the E-business ladder and they are mainly focusing on the technical, economic and new sales channel areas of E-business and not much on marketing, management, educational training. Keywords: Information Technology (IT), Small and Medium Enterprises (SMEs), E-business
