An Evaluation of the Relationship between Origins of Corporate Competencies and Business Performance of Taiwan’s SMEs

Abstract

This study develops an exploratory model to evaluate the relationship between origins of corporate competencies and business performance, which targets small and medium‐sized enterprises (SMEs) in Taiwan, analyzes 36 competence items in four functional dimensions: marketing, product design and development, manufacturing, and human resources management. The results from 760 valid samples from managers of Taiwan’s SMEs reveal that in marketing competence and manufacturing competence were ranked high by Taiwan’s SMEs managers. Elements contributed to manufacturing competence regarding reducing the number of suppliers has not been emphasized by Taiwan’s SMEs managers. At the very top of the prevailing management competitive priority list are: (1) product or service quality, (2) timely delivery, (3) quality control improvement during the process, (4) increasing reliability of tranportation, (5) introduction of new concepts and continuous improvement, and (6) improving after‐sale services. The four competence dimensions are found highly correlated to business performance, which reflects the policy adjustments that Taiwan’s small and medium‐sized enterprises have made in the changing business environment to respond to the global market.