Manufacturing Small And Medium Enterprises Research Articles

Stakeholder pressure and circular supply chain practices: Moderating roles of environmental information exchange capability and circular innovation orientation

AbstractThis study deploys institutional theory and Resource orchestration theory (ROT) to examine the roles supply chain stakeholder pressure, circular innovation orientation (CIO) and environmental information exchange capability (EIEC) play in adopting Circular supply chain (CSC) practices. This study uses a partial least square structural equation modelling (PLS‐SEM) to analyse survey data gathered from 290 managers of manufacturing Small and medium enterprises (SMEs) in Ghana. This study finds that pressure from supply chain stakeholders substantially drives manufacturing SMEs' CSC practices. This study confirms that EIEC negatively moderates the relationship between supply chain stakeholder pressure and CSC practices. Finally, this study confirms the complementarity between CIO and EIEC through moderating effects between supply chain stakeholder pressure and CSC practices. This study advances circular supply chain management (CSCM) literature by testing a research framework that examines important but rarely studied roles of CIO and EIEC in SMEs' CSC practices adoption under supply chain stakeholder pressure through institutional and resource orchestration perspectives.

Designing a Sustainability Assessment Framework for Peruvian Manufacturing Small and Medium Enterprises Applying the Stakeholder Theory Approach

Among the main obstacles affecting the competitiveness of Peruvian Small and Medium Enterprises (SMEs) are poor strategic planning and incipient use of management control systems that support the integration of sustainable practices for the growth of the organization. Not considering sustainability in the strategy and management control systems of Peruvian SMEs can jeopardize their stability and growth, as they are part of the supply chain of large companies that look for suppliers that comply with sustainability standards. Since manufacturing SMEs play a vital role in the economies and social welfare of countries, providing them with appropriate management tools to evaluate the sustainable performance of their activities is urgent to assure their survival. Thus, the aim of this study is to design a holistic sustainability assessment framework that enables Peruvian manufacturing SMEs to evaluate the full integration of sustainability into their business strategy and the creation of value for each stakeholder. Based on the gaps found in the literature review, a conceptual assessment framework was designed, then a multiple-case study was conducted in three Peruvian manufacturing SMEs in the plastic sector, and the data obtained were used to deploy the proposed conceptual assessment framework.

Advanced Sustainability Action Plan: Supporting manufacturing SMEs on a sustainability pathway

The manufacturing industry faces numerous challenges: increasing energy and material costs, limited resources availability, customers’ and legal requirements on product quality, climate action, social standards. An example for a political and regulative push is the European Green Deal and the Industry 5.0 strategy announced by the European Commission, which requires manufacturing enterprises to take actions to improve sustainability. Especially small and medium enterprises (SMEs) require support to identify potentially suitable actions to implement.This paper proposes a guided decision support method for SMEs to help them on the sustainability pathway. With a multi-step procedure, the current status of a specific company regarding sustainability actions, their development goals, challenging fields of action, plans and interests in application of advanced technologies and social or environmental services can be identified. Starting from a questionnaire-based self-assessment, relevant fields of actions are derived and potential advanced technologies, social innovations and environmental services are identified. The developed approach combines evaluation of the assessment results, as well as online workshops with SMEs to refine the obtained information, align the suggested set of actions with needs of the companies and prioritize them. As result of this procedure, participating SMEs receive an advanced sustainability action plan (ASAP), which helps them to prioritize available measures to implement on their individual sustainability pathway. The ASAP has been implemented for 41 companies within an online community hub system designed to match and join technology and service providers with manufacturing SMEs. "Processes and Production system" was identified as the most important action field for 41% of SMEs, highlighting the need for efficiency improvement in production processes.

Effect of internal barriers on innovation performance in embryonic SMEs in Malaysia

Manufacturing small and medium enterprises (SMEs) need to propel their creativity and innovativeness to enhance their innovation performance in the competitive and fast-changing environment. The current environment has transformed the internal working pattern, structure, and communication system to survive the rough business ecosphere. Consequently, SMEs encountered innumerable barriers to achieve the innovation performance and the SMEs should recognise the internal barriers so that they are able to accelerate their innovation performance. Therefore, this study aims at examining the internal barriers namely constraint in financial resources, constraint in technology, and constraint in human resources that hamper the innovation performance among the Malaysian manufacturing SMEs. This study embarked on two phases of data collection. First phase includes a series of semi-structured interviews with 15 participants from 5 SMEs via snowballing technique to gather their insights on internal barriers that impede innovation performance. For second phase, the survey method was adopted, and 217 SMEs responded to the survey. All the responses were analysed using SmartPLS technique. The interview findings demonstrate that all the internal constraints are indeed important for SMEs to grasp and serve as the obstacles for innovation performance. Nevertheless, from the quantitative analysis, only financial constraints serve as the significant barrier that impede innovation performance. To summarise, this research produces insights on decisive proof regarding internal barriers that inhibit the manufacturing SMEs to achieve innovation performance.

Modular Ontology to Support Manufacturing SMEs Toward Industry 4.0

Industry 4.0 (I4.0) implementation is a hot topic among manufacturing organizations to reach smart factory status and integrate a fully connected ecosystem. Achieving such a transition presents notable challenges for Small and Medium Enterprises (SMEs) since they often face resource and skilled personnel limitations. This study developed a domain ontology to represent various stages of maturity toward I4.0 implementation. Ontology provides a tool for SMEs to self-assess in situations of machines, processes, and factories for the dimensions of control, integration, and intelligence. This study focused on the identification of classes and relationships according to I4.0 implementation situations in the context of a manufacturing setting, the reuse of ontologies related to the domain of observations to model situations, and the creation and validation of the ontology through the information obtained from the questionnaires applied to SMEs. Finally, the ontology delivers a tool to understand SMEs' current state concerning I4.0 implementation and plan based on informed decisions about the maturity state and the technology required to advance to the next stage in their manufacturing processes.

Small and medium business transformational leadership and supply chain management

The performance-related problems facing small and medium enterprises (SMEs) in South Africa are well known. Efforts to find lasting solutions are ongoing and include empirical research focusing on various business practices and models. Applying leadership practices and supply chain management to SMEs provides fertile ground for groundbreaking solutions. This study tested the relationship between transformational leadership, supply chain execution and supply chain performance in manufacturing SMEs in South Africa. The study uses structural equation modelling to examine this empirical connection using data collected from 411 professional employees drawn from SMEs in three South African provinces. The study found that idealised influence and intellectual stimulation exert a positive impact on supply chain execution. Supply chain execution is positively linked to four supply chain performance factors, namely agility, reliability, cost optimisation and responsiveness.Transdisciplinary contribution: The study connects transformational leadership, which is an organisational behaviour construct to supply chain management, the latter of which is an emerging business discipline. The study recognises that business strategy is implemented by people whose conduct and practices are pivotal to strategic success. In addition, the study has an entrepreneurship orientation as it addresses the challenges facing manufacturing SMEs in South Africa.

The impact of corruption on SMEs’ access to finance: Evidence using firm-level survey data from developing countries

The present paper estimates the impact of bureaucratic corruption on access to finance for small and medium enterprises (SMEs) in the manufacturing sectors of 79 developing countries. Corruption can make it difficult for businesses to obtain financing by reducing profits, increasing credit demand, increasing the likelihood of bankruptcy, creating uncertainty about future profits, and exacerbating the asymmetric information problem between borrowers and lenders. Consistent with this viewpoint, our findings show that corruption significantly increases the likelihood of a manufacturing SME being financially constrained. A one standard deviation increase in the prevalence of corruption leads to a 3.5–4.9% point increase in the likelihood or probability of a manufacturing SME being financially constrained. In countries with credit bureaus and more freely functioning credit markets, the increase in the likelihood of being financially constrained due to higher corruption is much smaller. We argue and provide evidence that these heterogeneities stem from the specific ways in which corruption affects SMEs’ access to finance. Thus, the heterogeneities help to raise confidence against the omitted variable bias and reverse causality concerns with our estimation. We also find that higher corruption makes it more difficult for SMEs to access finance in more competitive product markets, as well as for small compared to medium-sized firms. The findings have important policy implications for anti-corruption initiatives, financial development, and the level of competition in product markets.

THE NEXUS BETWEEN RECRUITMENT AND SELECTION PRACTICES AND BUSINESS PERFORMANCE OF NIGERIAN SMALL AND MEDIUM-SIZED MANUFACTURING ENTERPRISES

This paper examined the relationships between recruitment and selection practices with business performance in the manufacturingsector using the Small and Medium Enterprises (SMEs) in the Lagos metropolis as the unit of analysis. It identified employee referral,job vacancy advertisement, employment agency and employee promotion as the most commonly used recruitment and selectionpractices in the manufacturing SMEs’ environment. The study made use of a questionnaire administered to 288 respondents and the results obtained showed that the vacancy advertisement and employment agency have a moderate relationship with business performance while employee promotion has a weak relationship with business performance while employee referral has a negative relationship with business performance. Regression results also indicated a positive relationship between combined recruitment and selection practices and business performance. It was concluded that the management of SMEs should prioritise employment agency among the recruitment and selection practices since it was found to have a more decisive influence on business performance. Thus, having the patronage of the employment agency with sound personnel policies that will be costeffective and outline human resource requirements is recommended.

An Analysis of Eco-Innovation Capabilities among Small and Medium Enterprises in Malaysia

The objective of this study is to look at how Malaysian small and medium enterprises (SMEs) are applying eco-innovation capabilities in order to sustain their business performance. Eco-innovation capabilities are represented in this study by five different types of practices, with the indication of unexpected circumstances: eco-product innovation, eco-process innovation, eco-organisational innovation, eco-marketing innovation, and eco-technology innovation. The qualitative research approach was used in the study, and the content analysis was based on in-depth interviews with six top-level managers/owners of Malaysian manufacturing SMEs. According to the data, more than half of SMEs acquired eco-innovation capabilities in order to continue their business performance and thrive in the business sector, while having to confront certain hurdles due to unforeseen situations. According to the findings, eco-innovation capabilities encourage SMEs to engage in waste management, recycling or reusing resources, research and development, sustainable goods that utilize customer requests, and the use of environment management machines. Thus, the findings of this study may aid the efforts of government agencies, policymakers, and top-tier manufacturing SMEs in building an exceptional innovation platform on which SMEs may rely for assistance and support in preserving their business performance in the future and beyond.

Knowledge management: Implications to SMEs performance in Nigeria

Purpose: The purpose of this research is to determine the effect of knowledge management on firm’s performance in selected manufacturing small and medium enterprises (SMEs) in Southeast Nigeria.
 Design/Methodology/Approach: The data is gathered from different manufacturing SMEs in Southeast Nigeria for this study. The sample size was 196 gathered from the population size of 800 selected manufacturing SMEs. The convenience sampling is used for the study. Descriptive statistics (frequency tables and percentages) was adopted for data presentation, however, Pearson correlation co-efficient along with regression analysis was applied for hypotheses testing.
 Results: The results exposed that there is an encouraging positive significant association between knowledge management along with SMEs performance. The outcome expressed that there is an encouraging significant relationship between the knowledge management dimensions (knowledge sharing, knowledge acquisition in addition to knowledge protection) and firm performance dimensions (market share, sales growth as well as customer satisfaction).
 Conclusion: The study concluded that SMEs which acquire new knowledge tend to satisfy their customers more than those with outdated knowledge, and those who share knowledge with employees tend to gain larger market share than those who do not share with employees.
 Contribution to Literature: This study contributes to the existing literature in two ways: first, this utilized the knowledge management variables which were not utilized in previous studies. Second, this study decomposed firm performance by using three different indicators.

Kesan Orientasi Pengurusan Strategik Terhadap Kecekapan Firma Pembuatan Halal

High demand for halal products globally has contributed the rapid development of halal small and medium enterprises (SMEs). Halal Manufacturing Supply Chain Management (HSCM) has been adopted by SME as a dynamic action in improving firm performance (FP). However, the benefit of HSCM can not be fully achieved without effective strategic manufacturing management (SMM). Based on this concept, the relationships between SMM, HSCM, and FP have been debated. Hence, rigorous research is necessary to identify the factors and the implications of SMM towards HSCM and also FP as a whole. The primary objective of this research is to recognize the SMM practises applied in the halal manufacturing SME sectors. This research uses purposive sampling. A Structural Equation Modeling (SEM) by Partial Least Square (PLS) technique has been employed in analysing the collected data. Market orientations were found to have a significant impact on business performance when applied to halal-certified SMEs. On the other hand, despite having statistically significant effects on business performance, supply chain orientation exerted a reduced influence. This study establishes a framework for halal practitioners to improve their business operations through the application of strategic orientation principles.

What drives responsible innovation in polluting small and medium enterprises?: an appraisal of leather manufacturing sector.

Responsible innovation (RI) has always been a major topic in discussions about environmental concerns, such as the depletion of natural resources, economic advancement, climate change, and social responsibility. Still, its incorporation in the business field is in its early stages, particularly among small and medium enterprises (SMEs). This research aims to investigate the influence of internal and external drivers on RI and sustainable competitive advantage (SCA). The hypotheses of the study are examined through the Structural equation modeling (SEM) technique, and data were gathered from 291 owners/managers of leather manufacturing SMEs through simple random sampling. The study found that external drivers significantly and positively impact RI strategies, whereas internal drivers have an insignificant relationship with RI strategies. Furthermore, RI strategies have a significant and positive relationship with SCA. This study adds to the existing literature by focusing on predictors that impact SCA. This initial study examines the influence of external and internal drivers on RI and SCA using dynamic capability theory and institutional theory. On these bases, relevant recommendations have been made to promote RI from the perspective of the government and SMEs.

SMEs’ sustainable innovation performance during pandemic: impact of knowledge coupling and parallel-mediation of ambidexterity and market capitalising agility

ABSTRACT Covid-19 pandemic has caused crisis and uncertainty which adversely influenced innovation performance of small and medium enterprises (SMEs). Innovation is a primary source of survival and growth in SMEs; therefore, this study aims to develop and empirically analyse conceptual model that sustains innovation performance of SMEs during the pandemic. This study integrates knowledge-based view (KBV) with a self-tuning model to examine Chinese manufacturing SMEs. Survey data of 306 responses were collected from the top and mid management and analysed through Smart-PLS 3. Results indicate a positive effect of knowledge coupling on innovation performance; besides, ambidexterity and market capitalising agility (MCA) positively mediate between knowledge coupling and SME innovation performance. This study contributes to KBV, self-tuning, strategy, innovation and crisis management literature. To practitioners, this study advises developing dynamic capabilities to sustain innovations during pandemic crisis. This is the earliest empirical examination to mediate the effect of knowledge coupling on innovation performance through ambidexterity and MCA during a crisis.

Sustaining innovation during downsizing strategy through knowledge coupling, business process digitization, and market capitalizing agility

COVID-19 has developed chaos and uncertainty for small and medium enterprises (SMEs) causing mass downsizing. Under such uncertainty, innovation is key to survival and agility to growth. This study examines role of knowledge coupling and business process digitization (BPD) in sustaining innovation through market capitalizing agility (MCA) besides downsizing strategy. Data have been collected from top and mid management of Chinese manufacturing SMEs and analyzed with knowledge-based view and self-tuning model through Smart-PLS 4. Knowledge coupling positively contributes to MCA and innovation irrespective of downsizing strategy. Effect of BPD on innovation performance is same; however, insignificant on MCA in no-downsizing sample. Likewise, MCA positively influences innovation performance and positively mediates between knowledge coupling (BPD) and innovation performance only during downsizing. This study is first of its kind to establish mediating effect of MCA between knowledge coupling (BPD) and innovation performance during downsizing phase and offers significant theoretical and practical implications. JEL Classification: J63, O31

Driving Factors of Industry 4.0 Readiness among Manufacturing SMEs in Malaysia

Industry 4.0 increases the production efficiency and competitiveness of companies. However, Industry 4.0 implementation is comparatively low in developing countries, while Malaysian manufacturing Small and Medium Enterprises (SMEs) Industry 4.0 adoption is still in its infancy stage. This quantitative study aimed to broaden the knowledge of the driving factors that significantly strengthen Malaysian manufacturing SMEs’ readiness for the digital revolution. Based on the Resource-Based View theory, the study built a research framework to govern the investigation of organizational capabilities, SME institutional support, perceived advantage, and market factors as the driving factors of Industry 4.0 readiness, while firm size as the moderating variable. The data were collected by conducting an online survey with the owners and managers of Malaysian-owned manufacturing SMEs located throughout Peninsular Malaysia, where the firms have received some form of government assistance. The analysis of the study indicated that organizational capabilities, SME institutional support, and market factors positively correlate with Industry 4.0 readiness. It was determined that firm size only moderates the relationship between SME institutional support and Industry 4.0 readiness. This study’s findings benefit industry practitioners and policymakers who wish to drive the future of Malaysia’s SMEs business ecosystem and contribute to Industry 4.0 literature.

Transactional leadership and its effect on supply chain management in manufacturing SMEs

The continued lacklustre performance of small and medium enterprises (SMEs) in South Africa has brought the quest for lasting solutions. One of the options available is to tap into the areas of leadership and supply chain management (SCM) as potential sources of SME growth.
 This study analysed the link between transactional leadership and SCM in manufacturing SMEs in South Africa. The research constructs included transactional leadership, supply chain execution (SCE), and performance.
 The research was conducted in Gauteng, North-West and the Free State provinces. Furthermore, the study focused on established manufacturing SMEs, registered with the Small Enterprise Development Agency (SEDA).
 A quantitative research approach using a correlational design was used. 411 SME owners, managers and professional employees participated in the study.
 Management by exception exerted a positive effect on SCE. In turn, SCE positively impacted customer service (CS) but did not affect supplier performance.
 The impact of transactional leadership on the execution of SCM in manufacturing SMEs is minimal and is demonstrated through management by exception. Effective implementation of SCM in these businesses is essential for optimising CS.

Digitalisation of manufacturing operations: The influential role of organisational, social, environmental, and technological impediments

The dynamic market environment has asserted that small and medium enterprises (SMEs), especially in the manufacturing sector, need to reassess their supply chain pursuits and effectively inculcate sustainable initiatives through digitalisation. Twenty-one barriers are identified, and fifteen solution initiatives (SI) have been suggested based on an in-depth literature review and expert opinions from electronic manufacturing SMEs. Further, experts were requested to prioritise the barriers and SIs using the Fuzzy Analytic Hierarchy Process (FAHP) and Preference ranking organisation method for enrichment evaluation (PROMETHEE) technique. “High Implementation cost”, “market competition”, and “resistance to adopt” are the barriers that hamper the adoption of emerging technologies related to Industry 4.0 (I4). “Using 6R”, “Conducting training and education for personnel”, and “Working on brand image” are the top-ranked initiatives that can actuate a firm to adopt sustainable practices. The present study will help academicians, practitioners, and policymakers to formulate effective decision strategies to overcome I4 adoption barriers.

Eco-Innovation Capabilities and Sustainable Business Performance during the COVID-19 Pandemic

The COVID-19 pandemic has had a direct impact on the manufacturing industry in Malaysia because all economic activities had to be suspended for some time. This study explores the role that eco-innovation capabilities might play in improving sustainable business performance during the ongoing pandemic. This study employs a quantitative method by distributing online questionnaires to 80 small and medium enterprises (SMEs) in Klang Valley, Malaysia. In the study, the relationship between sustainable business performance and the three variables of eco-innovation capabilities, i.e., eco-product innovation, eco-management innovation and eco-logistic innovation, were determined using multiple regression analysis. The results indicate that two hypotheses are accepted and the other one is rejected. The findings indicate that most manufacturing SMEs in Klang Valley have adopted eco-management innovation and eco-logistic innovation as crucial capabilities for their businesses during the pandemic. However, due to the challenges faced by these SMEs during the pandemic, eco-product innovation was found to have an insignificant relationship with sustainable business performance. It is insignificant because of the low productivity rate observed during the pandemic. Hence, the COVID-19 pandemic has caused manufacturing SMEs in the Klang Valley to not be able to maintain their operations and stay on track. Therefore, this research may contribute to the efforts of policymakers, government agencies and managers of manufacturing SMEs in developing a strong innovation platform on which manufacturing SMEs may rely for support in enhancing their business capacity and performance.

Responses of Exporting SMEs to Institutional Voids: The Case of Lithuania

Purpose: The aim of this study is to explore the responses of Lithuanian exporting small and medium enterprises (SMEs) to institutional voids using the typology of strategic responses to institutional processes of Oliver (1991). Study design/methodology/approach: The qualitative research case study method was selected by implementing semi-structured interviews with directors and founders of Lithuanian exporting manufacturing SMEs to collect the primary data. Findings: Drawing on the semi-structured interviews, the study identified responses of the Lithuanian exporting manufacturing SMEs to institutional voids that portrayed two main strategies: acquiesce and avoidance. Originality/value: The results provide contextual contributions exploring firms' strategic responses to institutional voids, identifying the most fatal institutional voids faced by SMEs within the sector.

A Hybrid Fuzzy Approach to Success in E-Commerce Adoption in Iranian Manufacturing SMEs

E-commerce adoption is one of the most controversial subjects among small and medium enterprises (SME)s in Iran. The present study is conducted with the aim of identifying the most important factors in e-commerce adoption – reviewing the causal relationships and clustering them. To identify the most important factors, the data is collected by questionnaires filled by 95 experts who were chosen as researchers’ judgment. Examining the causal relationships among the studied factors and clustering is done by fuzzy decision making trial and evaluation laboratory (DEMATEL) and interpretive structural modelling (ISM) techniques respectively. Data is collected from 12 experts and analysed by MATLAB and EXCEL software. According to the results, government support as one of the causal factors among critical factors effecting on e-commerce adoption is the highest influential factor, along with cost of public’s training. Both factors are put into the first cluster. Moreover, organisational flexibility plays an intermediate role between the first and the third cluster.