Effect of Inter-organizational Learning on Construction SMEs Performance

Abstract

Construction small and medium-sized enterprises (SMEs) face different challenges pertaining to their competitiveness and capabilities. Inter-organizational learning (IOL) is a key activity that contributes to organizational development and long-term survival. The purpose of this paper is to investigate whether IOL has an influence on SMEs performance. A questionnaire survey was used to collect data from 81 construction SMEs in Malaysia. Partial least square-structural equation modeling (PLS-SEM) was used to analyze the data. The results showed a strong and positive relationship between IOL and SME performance. Based on the findings, a new model has been proposed to explain how performance can be enhanced through three activities of IOL, namely internalization, externalization, and intra-organization learning. Enhancing the performance of SMEs is essential for the performance of the whole construction industry and this paper has contributed toward this main goal.