Owner Managers Research Articles

Strategic, Tactical and Operational Decisions in Family Businesses: A Qualitative Case Study

Previous studies of family businesses have no common agreement on what should be the most effective and efficient approach for making decisions at different managerial levels to solve business issues. Accordingly, the main objective of this study was to understand the nature of decision-making by family members who are involved in a business in different capacities such as owners, owner managers, and managers. Locating the research in the interpretivist paradigm, and utilizing qualitative case study methods (Yin, 1994), we interviewed 24 respondents from 12 well-known family firms from different districts in Sri Lanka. Thematic analysis indicated that the consultative approach is mostly used by family members in operational, functional, and top level management decisions. Yet, family members’ decisions in the business as owners, owner-managers, and managers have not shown a common decision-making process. Owner-managers’ roles in the business decisions are highlighted as they make rational, risk averse, and deliberate business decisions which would assist to run the business. In comparison, owners and managers have followed the consultative decision-making approach to shape business decisions in line with family requirements.

Owner–manager perceptions of regulation and micro-firm performance: An exploratory view

Regulation has traditionally been explored in terms of its negative burden on financial performance. We posit a true assessment should consider both its burden and value, as well as financial and wider performance criteria. This hypothesis is explored in the context of micro-firms using original survey data from the English tourism industry, using multivariate regression techniques and qualitative comments. Perceived-Burden demonstrates a negative association with financial performance, while Perceived-Value demonstrates a positive association with goal-satisfaction. Resulting policy recommendations focus on accompanying future regulatory changes with appropriate positive information so managers can move beyond burden to recognize the inherent value, and suggesting the need for further research in this area.

Exploring the role of goal setting and external accountability mechanisms in embedding strategic learning plans in small firms

PurposeThis paper explores the role of goal setting and external accountability mechanisms in embedding strategic learning plans in small firms. The research question asks, how are strategic learning plans embedded in small firms?Design/methodology/approachInsights from in-depth action research carried out with three small firm owner-managers (OMs) inform the study.FindingsFindings present valuable insights into how small firms learn strategically, and the link between OM goal setting and external accountability mechanisms in pursuit of embedded learning. A framework for embedding strategic learning plans in small firms is presented.Research limitations/implicationsThis study offers a contribution to knowledge in the areas of small firm learning, strategic planning and social learning theory. While the sample size is small, data and case protocols are in place which allow for replication of the study. As the research is embedded in social learning theory, alternative theoretical frameworks may shed a different light on the research question.Practical implicationsThe study may be of interest to practitioners working in the design, development, delivery and evaluation of learning interventions for small service firms. Given the importance of the small firm sector to the global economy, the research may also be of interest to government agencies, who strive to protect the survival and growth of small firms generally and who set aside resource amounts each year to fund training programmes for small firm OMs.Originality/valueThe research contributes to the body of existing knowledge in the small firm setting concerning social learning theory and small firm learning strategies. It has identified a link between OM goal setting and external accountability mechanisms in pursuit of sustainable organisational learning in small firms and offers a framework for embedding strategic learning plans in small firms. The study answers calls for a more robust framework to advance understanding of how OMs learn and whether that learning is consequently embedded in the organisation. The proposed framework can be used as a guideline for support organisations in assisting small firms in reaching their learning potential. It can also be used by small firms in the attainment of strategy learning capability.

SME productivity stakeholders: getting in the right orbit

PurposeThe purpose of this paper is to explore who small and medium-sized enterprise (SME) owner–managers consider as key stakeholders for their business for helping increase productivity and the nature of the stakeholders' impact.Design/methodology/approachThe study uses the Lego Serious Play methodology and narrative analysis in a focus group setting.FindingsThe analysis revealed a narrow depth of field of productivity stakeholders and identified critical narratives, involving close stakeholders which could constrain productivity. Lack of information on current and/or future productivity states, and a social brake due to the potential impact on employees are two at the forefront of owner–manager perspectives. The study also identified the importance of internal and external champions to improve productivity and re-enforced the significance of skills gaps, the role of Further Education providers and other infrastructure assets.Research limitations/implicationsThe purposiveness sample of the single focus group setting results in a lack of generalizability, but provides potential for replication and transposability based on the generic type of stakeholders discussed. The work highlights the potential to further enhance the constituent attributes of stakeholder salience.Practical implicationsThere is a potential for different network agents to increase their collaboration to create a more coherent narrative for individual productivity investment opportunities and for policy makers to consider how to leverage this.Social implicationsThe findings suggest that the implications of deskilling and job loss are major factors to be considered in the policy discourse. SMEs are less likely to pursue productivity improvements in a low growth setting because of their local social implications.Originality/valueThe study is innovative in using Lego to elucidate narratives in relation to both stakeholder identification and their contributions to productivity improvement impact in a UK SME context. The study introduces an innovative stakeholder orbital map and further develops the stakeholder salience concept; both useful for the future conceptual and empirical work.

Exploring the role of goal setting and external accountability mechanisms in embedding strategic learning plans in small firms

PurposeThis paper explores the role of goal setting and external accountability mechanisms in embedding strategic learning plans in small firms. The research question asks, does an external learning intervention influence how strategic learning plans are embedded in small firms?Design/methodology/approachInsights from in-depth action research carried out with three small firm owner-managers (OMs) inform the study.FindingsFindings present valuable insights into how small firms learn strategically, and the link between OM goal setting and external accountability mechanisms in pursuit of embedded learning. A framework for embedding strategic learning plans in small firms is presented.Research limitations/implicationsThis study offers a contribution to knowledge in the areas of small firm learning, strategic planning and social learning theory. While the sample size is small, data and case protocols are in place which allow for replication of the study. As the research is embedded in social learning theory, alternative theoretical frameworks may shed a different light on the research question.Practical implicationsThe study will be of interest to practitioners working in the design, development, delivery and evaluation of learning interventions for small service firms. Given the importance of the small firm sector to the global economy, the research may also be of interest to government agencies, who strive to protect the survival and growth of small firms generally and who set aside resource amounts each year to fund training programmes for small firm OMs.Originality/valueThe research contributes to the body of existing knowledge in the small firm setting concerning social learning theory and small firm learning strategies. It has identified a link between OM goal setting and external accountability mechanisms in pursuit of sustainable organisational learning in small firms and offers a framework for embedding strategic learning plans in small firms. The study answers calls for a more robust framework to advance understanding of how OMs learn and whether that learning is consequently embedded in the organisation. The proposed framework can be used as a guideline for support organisations in assisting small firms in reaching their learning potential. It can also be used by small firms in the attainment of strategy learning capability.

Multidimensionality of HRD in small tourism firms: A case study of the Republic of Ireland

This case study explores multiple dimensions of human resource development (HRD) in small tourism firms (STFs) within the Republic of Ireland. Underpinned by the evolutionary resource-based view (ERBV) and institutional logics, this study investigates owner-manager/senior manager and employee perceptions of the internal and external STF context and how such contextual contingencies shape their perceptions and experiences of multiple dimensions of HRD. Our study highlights (a) a dynamic interaction between external institutional logics and internal contextual factors, with the owner–manager acting as a key agent in shaping HRD dimensions; (b) actors within STFs are able to reconcile potentially conflicting institutional logics to create a dynamic HRD approach; (c) STFs implement HRD in a coordinated manner, imbued with elements of formality and informality, and (d) significant differences exist between owner-manager and employee perceptions of HRD dimensions. We discuss the implications of the findings for both research and practice. • A broadening of the investigation of HRD in STFs to include managerial and employee, quantitative and qualitative dimensions. • The owner-manager is a key agent that mediates the impact of external contextual factors on HRD dimensions. • The owner-manager reconciles a plurality of institutional logics within the STF setting. • STF owner-managers and employees may differ significantly in their perceptions and experiences of HRD with the firm. • STFs adopt a coordinated approach to HRD implementation, imbued with elements of formality and informality. • HRD should be explored as a multidimensional concept to capture the actual reality of owner-managers and employees.

Exploring the system of digitised retail design—flattening the ontology

The objective of this article is to combine the two dominant perspectives of retail design— design and business—through systems thinking and flat ontology, in order to understand the ‘store’ as designed by retail designers in the new digital area. Using an abductive case study of the Danish retail design world, this article connects actors into a system, redefines 'the store’ as an interface between retailer and customer, and attaches the metaphors ‘observed universe’ and ‘extended self’ of owner managers to collectively designed spaces. The implication of the study is a retail design (and business) canvas.The article's practical contribution is clarifying the profession of retail design under the condition of digitised retail, and to present a first step towards a system-based theory for retail design. Managerial contributionThe article redefines the store as an interface affording customers' and retailers’ exchange of product and experiential interaction with the aim of providing adequate revenue.

Unlocking the niche potential of senior tourism through micro-firm owner-manager adaptive capability development

Abstract This paper explores the role of adaptive capability development among micro-tourism owner-managers (OMs) in pursuit of the niche potential of the evolving senior tourism market. We discuss strategic adaptive capability development in a tourism micro-firm environment, prior to outlining the research context and adopted interview method used to elicit OM views. Findings indicate that limited human resources impede the level of adaptive capability engagement in micro-tourism firms, whereby operational level capabilities act as an antecedent to adaptive capabilities. Such adaptive capabilities, including market sensing capabilities and senior tourism alignment activities, are developed by OMs as a means of differentiating their respective firms from sectoral rivals in pursuit of niche market potential. Extracted from the findings, we present a Senior Tourism Adaptive Capability Framework prior to disclosing the study's practical and theoretical implications.

Co-production in BDS: The evidence from the Sri Lankan Microfinance Sector

Microfinance Institutions (MFIs), in addition to the provision of microcredit, also provide business development services (BDS) to owner managers in order to develop micro enterprises. BDS are non-financial services such as business training and access to information that help owner managers of microenterprises to develop businesses. In this respect, counsellors and trainers in MFIs co-produce BDS with owner managers. Co-production is the joint efforts of two parties, who together determine the output of their collaboration. The objective of this study therefore is to examine how co-production works in a BDS setting. A multiple case study method was used to carry out the study. Six MFIs were selected as cases and in-depth interviews were held with counsellors, trainers and managers to collect the data. The findings reveal that the expertise of counsellors, trainers and owner managers are the inputs for co-production. The outputs of co-production are twofold: MFI specific outputs and owner manager specific outputs. While MFI specific outputs are identified in better loan repayments rates, enhanced client satisfaction, and increased client retention, the owner manager specific outputs are denoted by better business knowledge, better sales, and profits. MFIs use counselling and training as modalities to co-produce BDS. There are a number of factors that affect the variability in coproduction including the readiness of counsellors and trainers, with a number of BDS provided under each modality. Therein, the findings of this study are beneficial to microfinance practitioners and policy makers. Furthermore, the findings also contribute to the knowledge domain of microfinance. Keywords: business development services (BDS), co-production, microfinance, case study method.

THE INFLUENCE OF ATTITUDINAL FACTORS OF SME OWNER-MANAGERS ON ADOPTION OF FINANCIAL PRODUCTS

Given the key role of owner managers in the decision making process, understanding socio-psychological factors of small and medium enterprises (SMEs) financial behavior has often been prescribed as an important research direction. In accordance with the above, present study in context of Pakistan investigated the attitudinal factors of SMEs owner-managers’ towards adoption of financial products. The attitudinal factors are depicted as perceived relative advantage, perceived compatibility and perceived complexity. The proposed model has been adapted, which is composed of decomposed theory of planned behavior (DTPB) and decomposed attitudinal factors of SMEs owner-manager to investigate their intention to adopt financial products in Pakistan. Relying on a survey research design, and following stratified sampling method, after screening process 285 owner-managers responses have been considered for further analysis. The findings revealed that perceived relative advantage and perceived compatibility possess significant positive relationships with owner-manager attitude towards adoption of financial product which further significantly predicts behavioral intention. Moreover, perceived complexity has negative but significant relationship with SMEs owner-manager attitude towards adoption of financial products. SMEs owner-managers exhibit serious concern towards formal financial products adoption, the policy makers are suggested to focus on creating specialized products which are useful, compatible and easy to understand for SMEs owner-manager in Pakistan.

Exploring Factors Affecting the Effectiveness of Business Training in The Microfinance Sector: Using Industrial Marketing Purchasing (IMP) Approach

Microfinance institutions provide business training to its clients/owner managers to start and expand businesses. The literature reveals that business training given by MFIs helps improve the performance of both the MFIs and its clients (i.e., Owner managers of microenterprises). In effect, due to business training, MFIs can have improved loan repayment rates, client retention, and client satisfaction, while the owner-managers can have better sales, profits, and skills. However, despite the importance of business training to both MFIs and owner-managers’ performance, there is a dearth of research undertaken to explore the effectiveness of business training intervention in microfinance setting. In this study, effectiveness is defined in terms of the impact of business training on the performance of MFIs and owner-managers (i.e., training – performance dyad). Hence, the purpose of this exploratory study is to examine the factors affecting the effectiveness of business training given by the MFIs in Sri Lanka. A multiple case study method was used to carry out the study. The study was guided by the Industrial Marketing Purchasing (IMP) group framework. Thus, the study looks at how operating environment, atmosphere, interacting parties and the interaction process affect the effectiveness of the training intervention. The findings reveal that lack of money and low client demand for the operating environment influence training effectiveness. Further, it was identified that factors such as better loan repayment and new venture creation motivate the MFIs to provide business training, whereas better business knowledge and business performance motivate the owner-managers to receive business training. These motivators are part of the atmosphere that has a bearing on the effectiveness of business training. The findings further show that the characteristics of the interacting parties (i.e., trainers and trainees in this study) could affect business training effectiveness. Thus, the trainer’s expertise, trainer being internal or external, and trainer being full time or part-time can influence the training-performance dyad. Further, the owner-managers’ expertise and organizational structure could also affect the effectiveness of training. Several factors enhance the interaction between trainers and owner-managers. They are the trainer’s expertise and the owner-manager/client, trainer readiness, communication, follow-up procedures, feedback, and owner manager’s willingness. Further, location, duration of the training, charging a fee or not, the voluntary/compulsory nature of training, and the provision of subsidies also could enhance the interaction between the trainers and the owner-managers. Therein, this study contributes to the knowledge domain of microfinance. The findings are useful to practitioners and policymakers in microfinance as they can look at the IMP framework to identify factors that could enhance the business training-performance dyad. In this study, the client and the owner-manager are used interchangeably. Keywords: Microfinance, Business Training, Business Development Services, Case Study Method, IMP Framework.

Management Practices of SMEs Owners in Emerging Economies: A Gender Comparative Study

The literature on management practices indicates that the company’s performance depends largely on the skills of its leader, when the intuition of the latter is based on the instruments and rational management methods. The aim of this study is to analyse the relationship between the gender and management practices in terms of current operations (Production, marketing, finance, …), identify the characteristics of the owner-manager of SMEs (male and female specific), and detect the points of divergence and convergence between women's and men's management. To do so, we conducted a theoretical analysis of the main concepts and indicators that allowed us to develop a research model. The analysis of the answers was based on a survey adressed to a sample of owner-managers. Our findings confirm that the personal characteristics of the owner-manager influence the management practices. The results of the comparison between the Moroccan ruling woman and man, show that there are no real differences in management style, but rather some shared values between them. This paper provides a theorical contribution on the link between the profile of owner-managers and management practices including the gender parameter. In terms of pratical contribution, it contribute to understand behavior of Moroccan SMEs owners and to show the importance of this two dimensions, the profil of owner managers and gender approach, it can be also considered as a recent study of the typical profile of owner-managers in an emerging country such as Morocco. We try, through this work, to contribute to this field of research which remains very fertile.

Corporate Environmental Responsibility and Firm Information Risk: Evidence from the Korean Market

Despite the potential benefits of a firm’s corporate environmental commitment to its information environment, few empirical studies examine the relationship between corporate environmental responsibility (CER) and firm information risk in emerging markets. In such markets, better corporate transparency and less information asymmetry are becoming increasingly important owing to firms’ poor governance structures, the lack of protection for investors, the substantial participation of unsophisticated individual investors, and so on. Using a comprehensive sample of firms engaged in CER for the period from 2005 to 2016, we find that a firm’s CER score has a negative effect on measures of firm information risk in the emerging Korean market, which is characterized by poor corporate governance and a strong influence of owner–managers. Furthermore, our results show that the negative relationship between CER and information risk is more pronounced for firms with higher uncertainty (lower transparency). Thus, we conclude that CER enhances a firm’s information environment by reducing investors’ information risk.

The Invisible Side of Managing Sustainability in Global Supply Chains: Evidence from Multitier Apparel Suppliers

Supply chain scholars, industry leaders, and policy makers have begun to recognize the importance of managing sustainability in global extended supply chains. However, scant attention has been paid to investigating the implementation of sustainable supply management practices from the perspective of multitier suppliers located in challenging institutional contexts. Drawing on institutional theory, this qualitative study examines how institutional pressures, mechanisms, and challenges influence the sustainability implementation of a developing country’s multitier apparel suppliers. The study not only captures the viewpoints of 46 owner–managers across 33 multitier suppliers, but also provides complementary evidence from a wide range of institutional actors. The findings show that first‐tier and second‐tier suppliers experience more collective coercive pressures than mimetic and normative pressures toward sustainability implementation. However, only coercive pressure from second‐tier suppliers influences third‐tier suppliers’ sustainability implementation. The identified key collective coercive pressures were stemming from the selection and assessment requirements of direct buyers, followed by third‐party auditors, governments, and newly emerged collective buyers’ consortia. Finally, building on empirical findings, this study presents a framework and research propositions for understanding the diffusion of sustainability to multitier suppliers.

The impact of high insider ownership on SOX 404 internal controls

PurposeThis study aims to investigate the effect of high insider ownership on firms’ internal controls over financial reporting. In particular, it examines how high insider ownership affects the likelihood of an adverse Sarbanes–Oxley Act Section (SOX Section 404) opinion and its subsequent remediation.Design/methodology/approachTests of hypotheses use ineffective controls and remediation models. The initial tests in this study use ineffective internal controls over financial reporting probit regression models to investigate how high insider ownership affects the ex-post likelihood of an adverse 404 opinion. Two remediation models – a multinominal probit regression and probit regression model – are used to investigate the effect of high insider ownership on the likelihood of successfully remediating an adverse 404 opinion.FindingsResults show that while the ex-ante likelihood of an adverse SOX Section 404 auditor’s internal control opinion increases with high insider ownership, high insider ownership firms are more likely to remediate ineffective 404 controls. This study rationalizes these diverse findings by asserting that prior to an adverse 404 opinion, entrenched managers avoid internal control financial reporting oversight and monitoring. After an adverse opinion, however, and within the context of an imminent and explicit value reducing 404 opinion, powerful high insider owner managers are motivated to remedy ineffective controls.Originality/valueThis research synthesizes existing streams of literature on insider ownership and the effectiveness of internal control over financial reporting quality to provide new information on the effects of high insider ownership on firms’ internal controls.

A Study in the Selection Factors of Facility Management(FM) Enterprises Using AHP Analysis

Looking at recent safety accidents in buildings, most of them due to lack of FM expertise, and this is due to human resources. In each all industry areas, some companies are competitive, representational, and leading in the market through long-term expertise and research in their respective fields. In the field of FM industry, some companies offer core-competencies in internal and external innovative building management through competition with others. However, old custom and old management form still exist in the FM field. However, an old custom and old management system still exist in the FM field; it forces cost-cutting and caused by carelessness in technical development competitiveness and safety measures. The government control by safety inspection and facility inspection through legislation of building management, but the management is still weak as a side of in the facility management section due to inspect sth as a mere formality and submit a paper report. These facts exist different kind of usage of the building have a three-party encounter between a building owner, user, and FM enterprises. In this research identify survey, especially building owner (manager)’s choice perception priority for optional factors to choose FM enterprises. Based on this, FM enterprises will be forced to seek a new dimension for better building management. In this light, the purpose of the research is to shape changes in the FM market culture safely and providing better service in building management and understanding building owner's insight through this research's information.

Determinants of SME growth: an empirical study in Saudi Arabia

PurposeThis study aims to examine the determinants of the growth of small- and medium-sized enterprises (SMEs) in the Kingdom of Saudi Arabia. The resource-based view theory is adopted in the analysis of the study.Design/methodology/approachThe descriptive and multivariate regression analysis was used to analyze the data. A stratified sampling technique is adopted with a sample size of 119 managers from SMEs. There are variables delineated from theories (human capital, social capital, strategy and organization), which are associated with the firm’s growth that include; the size of the firm, firm age, manager’s education, training, experience, financing and network relationship.FindingsThe results found that the size of the firm, the experience of the manager, training, financing and the network relationship have a significant relationship with the firm’s growth. However, other variables such as the education and firm’s age do not have a significant relationship with the firm’s growth.Originality/valueThis study could be considered as an exposure to the SMEs in Saudi Arabia on the specific factors by the owner–managers who intend to develop their business.

Revenge of the Steamroller: ABCP as a Window on Risk Choices*

Abstract We use credit-arbitrage asset-backed commercial paper vehicles as a laboratory to empirically examine financial institutions’ motivations to take bad-tail systematic risk. By comparing the characteristics of global banks that sponsored credit-arbitrage vehicles prior to the global financial crisis to those that did not, we show that owner–manager agency problems, government safety nets, and government ownership of banks are associated with bad-tail systematic risk-taking. Although good governance is associated with less risk-taking on average, well-governed banks that also have a high ex ante expectation of being bailed out by the government take more risk. Lastly, we find mixed evidence that tougher bank capital regulation deters bad-tail risk-taking.

Mediation models: A focus on the Effect of Customer Satisfaction on the relationship between Ethicaltreatment towards Farmers and Enterprise Performance in Mumias sugar belt, Kenya

In the simplest mediation theory, the investigation of mediation specifies a chain of relations by which an antecedent variable affects a mediating variable, which in turn affects a dependent variable. Mediating variables can be behavioral, biological, psychological, or social constructs that transmit the effect of one variable to another variable. There are two overlapping applications of mediation theory. One major application of mediating variables is after an effect is observed and researchers investigate how this effect occurred. In this framework, a third variable is inserted into the analysis of an X~ Y relation to improve the understanding of the relation, that is, to determine whether the relation isdue to a mediator or is spurious. To demonstrate this astudy was conducted in Mumias Sugar Belt among cane haulage SMEs and their customers. The purpose of the study was to establish the mediating effect of consumers satisfaction on the relationship between ethical treatment towards farmers and enterprise performance. The study was guided by the stakeholder theory and a conceptualmodel of the same theory. Correlational survey design was adopted for the study. The study population was made up of 75,000 sugar cane farmers. A sample size of 382 based on 90% response rate was used guided by coefficient of determination formula. Cluster and simple random sampling techniques were used to select farmers with counties being the basis of cluster before applying random techniques. Questionnaires were used to obtain data from farmers. Frequencies were used to show distribution of responses. Correlations were used to assess associations between ethical treatment towards farmers and enterprise performance. Kenny and Barron 4 step mediation models were used to assess the mediating effect of customer satisfaction on the relationship between ethical business practices and enterprise performance. Pearson correlations established that farmers trust in drivers was negatively correlated to enterprise reputation and goodwill to the company. Similarly, Pearson correlations revealed that cane theft in transit had negative correlations with enterprise goodwill and customer loyalty. Logistic Regression indicated that cane theft in transit negatively affected customer loyalty. Pearson correlations revealed negative correlations between willingness to listen to farmers and employee dressing code. On the other hand, cane theft in transit negatively affected willingness to listen. Logistic regression revealed that willingness to listen to farmers partially mediated the relationship between cane theft in transit and customer loyalty by 9.62%. These findings are expected to enable cane transport owner managers increase enterprise profitability. Sugar cane sector policy makers are expected to use the findings to address the dwindling fortunes of the sugar sector in Kenya. KEY WORDS: Mediation model, Consumer Satisfaction, Ethical treatment enterprise performance. DOI : 10.7176/JMCR/60-05 Publication date :September 30 th 2019

Financial Inclusion for SMEs: Role of Digital Micro-financial Services

SMEs paly major role in poverty reduction and employment generation, therefore experts considered this sector as engine of economic growth. However, access to finance in developing countries is one of major issue in development of SME sector as well as hurdle in economic growth. Financial institutions banking and non-banking shows reluctant behaviour in providing financing to SMEs and the issue is more severe in emerging economies. Bank financing has been found as main source of funds for SMEs in Pakistan, however, to obtain these funds not easy for small and medium firms. Recently digital micro financial services have been introduced by a number of micro finance banks. Current study examines the role of digital micro financial services in enhancing SMEs’ access to finance and thereby enabling a more inclusive financial market for SMEs especially in context of emerging and developing economies. By digging out the existing literature and secondary data, the study discusses that digital financial services have greatly helped owner managers of SMEs in smooth management of their transactions and finances. The study concludes that to strengthen SME sector for economic growth, it is important to further reduce the cost of using digital financial services and increase the financial product portfolio on digital platforms.