Abstract
Research on SMEs in Malaysia has become more significant nowadays as SMEs in Malaysia contribute national income to the country. Internationalisation of SMEs is imperative as smaller firms operating international business today develop their own capabilities and competitive advantage. Thus, it is important for SMEs especially those in emerging countries like Malaysia to look into their social capital and put their efforts to strategize their capabilities to respond to the global competition and business opportunities. This study was conducted to examine the impact of social capital towards the SMEs capabilities before they adopt the best strategic approach to face challenge situations at hand. A quantitative approach was employed in this study and a total of 187 responses from manufacturing SME exporters were received and further analyzed using Partial Least Square (PLS) technique. The results demonstrated that social capital of manufacturing SMEs in Malaysia has significant impact only on innovation, marketing and technology capabilities but not market-linking and management capabilities.
Highlights
IntroductionThe interrelated of business relationship, knowledge and its development of strategy become crucial as business firms such as severely impacted to small firms (SMEs) trying hard to expand their business internationally
What is the impact of social capital towards strategic capabilities especially small firms? Nowadays, the interrelated of business relationship, knowledge and its development of strategy become crucial as business firms such as severely impacted to small firms (SMEs) trying hard to expand their business internationally
This study is to explore the concept of social capital to manufacturing SMEs in Malaysia that actively doing business internationally
Summary
The interrelated of business relationship, knowledge and its development of strategy become crucial as business firms such as SMEs trying hard to expand their business internationally They put their effort to understand their social capital and capabilities they possess to go abroad. They try to work closely with stakeholders (e.g. customers, suppliers and alliance partners) and gain knowledge from them. How their current social capital affects their capabilities at hand to stay competitive in the world business since they expand their business internationally?. The critical issue in SME sector is a large number of SMEs are closed down within a very shorter period of business commencement due to the many reasons (Prasanna et al, 2019) and Covid-19 for instant, is the most severely impacted to small firms (SMEs) business
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