Elevating the profitability of small and medium enterprises: Systematic review on risk management principles

Abstract

Small and medium-sized enterprises (SMEs) have a significant position in the world's economies by encouraging innovation and employment. These enterprises have limited resources and address particular obstacles while providing potential for development. Effective risk management is critical for SMEs to achieve long-term profitability. By identifying and minimizing possible risks, such as market changes and operational uncertainty, SMEs may protect their financial health and establish the foundation for long-term success. Implementing effective risk management concepts enables these organizations to handle insecurity, capitalize on opportunities and improve overall operational efficiency, resulting in a robust and effective business environment. In this research, we provide an in-depth examination of risk management in SME profitability, depending on empirical data, conceptual frameworks and beneficial case studies. Our objective is to determine common trends, challenges and standards of excellence in the field of SME risk management by investigating a range of resources. Initially, we collected 28 publications that primarily focused on risk management strategies for organization management, 10 articles were eliminated the cause of without taking into consideration SMEs. The subsequent phases of this systematic review of the literature, as well as the research process were based on in-depth analysis of the remaining 18 research articles. This research provides a beneficial understanding for improving overall SMEs' operational efficiency and profitability.