European SMEs’ value management based on controlling, financial analysis and ratios – empirical study

Přemysl Písař

doi:10.21511/imfi.16(4).2019.24

Abstract

Small and medium enterprises (SMEs) are a powerful economic force, significant employers, and creators of added value. In the European Union SMEs are the backbone of its economic and innovative potential, and for this reason, economic development and stability of SMEs are critical. The goal of this study is to apply modern controlling to the management of SME value growth using the tools and indicators of financial analysis. This study is based on a detailed analysis of 359 companies from the European Union in order to test 4 hypotheses. The data obtained were subjected to statistical analysis to identify the dependence between the controlling management of a company, tools of financial analysis, innovative potential, level of digitization, internal auditing, and HR communication tools used in the SME. The statistical analysis confirmed a close relationship between the studied variables and created a model for managing the company’s value growth for the study sample of SMEs. Subsequent experimental testing was used to confirm these conclusions, and other important associations were found that are important for successful management of SMEs value growth. The findings obtained are applicable in practice and can be used for a deeper analysis of the issues in question.

Highlights

The development of technology, globalization, hypercompetitive environment, and strong competition from large and multinational corporations are significant factors influencing the sector of small and medium enterprises (SMEs)
This study aims to apply modern controlling to the management of SMEs value growth using the
The analysis showed that 76% of all the SMEs with revenues of over EUR 20,000 are rated with the highest level of the variable HR communication, and these SMEs showed the highest level of the variable Financial analysis at 61%

Summary

Introduction

The development of technology, globalization, hypercompetitive environment, and strong competition from large and multinational corporations are significant factors influencing the sector of small and medium enterprises (SMEs). SMEs are a significant part of national economies. The development, growth, and stability of SMEs is a key component for the stability and competitiveness of national economies and the cohesion of the EU. This research is focusing on use of financial analysis and controlling management system as tools for SMEs value management. The obtained data were analyzed using the statistical methods, and the results were verified using the experimental testing in the selected SMEs. The obtained data were analyzed using the statistical methods, and the results were verified using the experimental testing in the selected SMEs This testing proves that controlling management system and financial analysis should be used for company’s value growth and long-term stability. A sample of 359 SMEs from the EU was used to study these issues

Objectives

Findings

Discussion

Conclusion