Performance Of Small Medium Enterprises Research Articles

Earthquakes, fear of failure, and wellbeing: An insight from Minangkabau entrepreneurship

Earthquakes have become a constant threat in West Sumatra, Indonesia, with the most recent occurring in 2009. This phenomenon has been observed to be due to the inhabitation of people, predominantly the Minangkabau ethnic group in the “ring of fire,” which potentially causes the megathrust earthquakes and arguably shaped entrepreneurial behaviors. Therefore, the objective of this study was to examine the relationship between earthquake impact, preparedness for megathrust, fear of failure, Small Medium Enterprise (SME) financial performance, and entrepreneurs' wellbeing. Furthermore, the fear of failure was regarded as a construct which significantly shaped the responses of entrepreneurs towards natural disasters. This investigation adopted a quantitative approach, using SmartPLS, to survey 120 small and medium enterprises affected by the 2009 West Sumatra's earthquake. The results showed the post-earthquake impact was positively and significantly related to fear of failure while the relationships between fear of failure, financial performance, and well-being of SME were also established. Moreover, the context of Minangkabau as a completely Muslim society generated arguments regarding religiosity and organizational resilience. These factors were discovered to have influenced entrepreneurship towards making a significant contribution to the body of knowledge in disaster entrepreneurship studies.

Theory and Evidence on the Relationship between Leadership Style and Organizational Performance: A Case in Small Medium Enterprises in East Malaysia

This research intends to provide the theoretical evidence on the relationship between leadership style and organizational performance of small medium enterprises (SMEs) in East Malaysia.  The growth organizational performances among SMEs in East Malaysia have been at stagnant stage, as they are not able to respond to unforeseen issues due to weak leadership. The SMEs in East Malaysia are losing their competitive advantages as compared to West Malaysia. There is lack of motivation among the followers working in SMEs in East Malaysia as employees do not put extra effort in their tasks. There is absence of creativity in workplace as employees have not been giving any productive output from a long time. Previous research have documented that there are relationships between leadership style and organizational performance in SMEs in East Malaysia. The current study steps forward to contribute to gaps in body of knowledge by looking at the effects that occur due to different leadership style and its influence on the organizational performance in SMEs in East Malaysia. The nature of this study add to the existing literature by integrating the theory and evidence that could enhance organizational performance.

Modified Carroll’s pyramid of corporate social responsibility to enhance organizational performance of SMEs industry

Research questions/issuesThe study seeks to examine Carrolls’ pyramid model in small-medium enterprises (SMEs) as an effective business strategy for organizational performance enhancement in industry of developing country which is in the initial phase of Industry 4.0 advance. The Corporate social responsibility (CSR) pyramid is important tool for fostering environmentally-sustainable manufacturing by having green manufacturing processes, green supply chain management, and green products and holds that firms should engage in relevant decisions, actions, policies and practices that simultaneously fulfill all component parts: ethical, legal, economic, philanthropic and environmental. Research findings/insightsOrganizational innovation as a mediator and corporate image as a moderator were incorporated in the modified conceptual model of Carroll’s pyramid. 888 valid responses from Small medium enterprises (SMEs) professionals in Pakistan manufacturing sector were collected, and then the structural equation modeling (SEM) based multivariate and conditional process modeling approaches were employed to conduct the investigation. Results demonstrated that the dimensions of modified Carroll’s pyramid of CSR have an affirmative and positive impact on the organizational performance of industrial SMEs if they were properly addressed in their innovation strategies. The findings further concluded that organizational innovation and corporate image are the significant mediator and moderator respectively between the dimensions of Carroll’s pyramid of CSR and the organizational performance that further enhance the organization performance and productivity in terms of ethical and sustainable business development and overall bottom line in the light of industry 4.0 approach. The outcomes confirmed that the inclusion of Industry 4.0, Cleaner Production, and Circular Economy concepts in the SME sector provides a synergistic business opportunity that intent to payback towards sustainable development by improving environmental management, production efficiency, and socially sustainable development for SMEs. Theoretical/academic implicationsThis study provides empirical support for the modified Carol’s pyramid in industrial SMEs following Industry 4.0 approach. As such, it suggests new avenues of research for both the Industry 4.0 literature, as well as for the studies in CSR and organizational performance perspective. Practitioner/policy implicationsOutcomes of this study suggest the senior managers of SME in industrial sector that implementing the modified CSR model would be an innovative and competitive business strategy in industry, which can effectively improve the organizational performance in terms of ethically, ecologically, and economically through organizational innovations and allows to foster Industry 4.0 development.

Business Support Services and Performance of Small Medium Enterprises in Rwanda: Case of BDF Supported SMEs in Gicumbi District

Business Support Services and Performance of Small Medium Enterprises in Rwanda: Case of BDF Supported SMEs in Gicumbi District

Study on Banks’ Risk Assessment of Financing Small Medium Enterprises’ Project: the findings and experience from Uzbekistan Banking Sectors

Small-Medium Enterprises (SME) fulfill important tasks in an economy. They play main role to create jobs opportunities and generating profit for low income nation, also support social stability and significant effect to development of a private sector dynamically. Banks have played a major role in financing and helping SMEs, work to grow up access of them to provide loan. Bank lending is the most common source of external finance for SMEs. However, no comprehensive investigation has yet been focused in banks to examine risk assessment of SMEs project. They have limited access to credit resources comparing to big companies (Jaroslav B., 2010). Therefore, most of SMEs do not use annual reports, annual file accounting or main statistics figures. So, it makes challenges for banks to identify risks and deciding to finance SMEs’ project. This paper focus on analyze risk assessment of financing SMEs’ projects in banking of Uzbekistan and investigate on identify risks, examine strong risk assessment for SMEs, try to find out various tools and techniques deal with bank financing projects. Carrying out the research, both qualitative and quantitative methods were used. Questionnaires distributed to the 100 lending managers and credit specialists, consisted three parts which two parts include 29 questions and final part include 5 open questions. We used Cronbach’s alpha to estimate reliability variables and subject regression analysis conducted on research objectives. Research found that credit managers have still challenges in understanding uses techniques and tools for assessing risks. It seems to be lacking understanding and unsophisticated approach to fully identify and manage risks. According to questionnaires’ results and case study analysis, data indicated the key indicator signals to finance SMEs’ project are financial standing, past performance of SMEs, leverage ratio and evaluated project concern significantly. Data showed an optimization of lending process lead to additional interest incomes and assessing risks in early stage. The model postulates that factors in the external, operating and internal environments of individual banks can influence risk assessment decisions for financing SMEs.

Strategic Planning and Performance of Small Medium Enterprises: Evidence From Lagos State, Nigeria

This study examines the strategic planning and its effect on small and medium enterprises performance in Lagos state, Nigeria. Specifically, the study evaluates the level of SMEs operators’ involvement in strategic planning, determines the factors influencing SMEs to adopt strategic planning in their operations, examines the perceived contributions of strategic planning in SMEs Performance, identifies the challenges facing the implementation of strategic plan in SMEs and also examines the effect of strategic planning on SMEs performance. A survey of four hundred and seventy (470) Small and Medium Enterprises (SMEs) were randomly selected from one thousand nine hundred and sixty- five (1,965) that registered with the Ministry of Commerce and Industry in Lagos State. Data were sourced via a structured questionnaire, while analysis of data was performed with the aid of frequencies, percentages, factor analysis and ordinary least square method of estimation. Results reveal that the majority of SMEs operators do not aware of the strategic planning process in their respective business organizations and their enterprises did not prepare enough for the formulation and implementation of the strategic plan. Furthermore, results also reveal that organizational complexities, scarce firm resources, new technology and environment dynamics in business operations influenced their adoption to strategic planning, while the presence of an effective strategic plan could facilitate good performance of SMEs via better decisions, customer satisfaction, increased capacity, and identification of problems, chance of success, better solutions, competitive advantage, and market recognition. Results show that inadequate resources, lack of experts and difficult to align organizational culture and strategic plan are the major challenges facing the implementation of a strategic plan in SMEs. Subsequently, the study recommends that entrepreneurial development agencies, as well as the government of Nigeria, should organize training and seminar for SMEs operators on the introduction and formulation of strategic planning. Hence the SME operators will have a full understanding of the industry in which it operates so as to cut an edge for the enterprises. Keywords: Strategic Planning, SMEs, Organizational Complexities, Firm Resources, Environment Dynamics DOI: 10.7176/EJBM/12-8-02 Publication date: March 31 st 2020

The Functionality and Comparisons of BSC and Alternative Theories in Organisations: Business Perspective

The purpose of this research is to show the comparison of Resource-based view, Human capital, stakeholder as alternative theories and Balanced Scorecards (BSCs). Resource-Based View (RBV) appears to be limited with narrow implications as the strategic roles. RBV is forced on the internal organisation of a firm and it does not consider the external factors like the demand side of the market. A firm or an organisation may have the resources and the capabilities to gain a competitive advantage but still have no demand. RBV is not explicit on how particular market-based assets and capabilities contribute to generating and sustaining specific form of customer values. Accordingly, Human Capital theory (HC) assumes education increases productivity in the organisation, resulting in higher individual wages, but failed to provide adequate insight into the process through which education training are translated into higher wages. High level of educational attainment and quality may not potentially yield greater productivity and wages across the board. In the same vein, stakeholder theory has no learning and growth perspective required in the 21st century business but provides managers with clear mission and facilitates decision making. Balanced Scorecards (BSCs) has four perspectives: Financial, Customer, Internal development and Learning and growth perspective. It sets priorities by identifying, rationalising and aligning initiatives. The broad aim of this study is to shed light on limitations of these theories. The paper intends to identify future research questions that would help to remove fundamental barriers to pave the way to the company-wide performance in Small Medium Enterprises (SMEs): does BSC or alternative theory add significant value to SMEs? If it does add value, how does it enhance the performance of SMEs in emerging economies?

정부 R&D지원사업이 중소기업 성과에 미치는 영향 분석 : 정보비대칭성의 매개효과를 중심으로

본 연구는 정부의 R&D지원 사업이 중소기업 성과에 미치는 영향을 분석한 연구이다. 본 연구는 R&D지원의 필요성에 착안한 연구이기 보다, 주인-대리인 측면의 정보비대칭성의 작용에 초점을 두고, 중소기업의 역선택과 도덕적 해이를 다루고자 하였다. 즉 최근 정부의 자금지원 등 정책정당성의 요구가 높아짐에 따라, 수혜 대상 중소기업이 지원방식과 그 내용에 대한 점검의 필요성을 제기한 연구이다. 이 같은 맥락에서 본 연구의 의의와 필요성을 제안한다. 이를 위해 본 연구는 전남 및 울산지역의 중소기업을 대상으로 설문조사를 실시하였으며, 수취된 165개중 147개를 표본으로 활용하여, 매개효과를 추가한 회귀분석을 실시하였다.BR 분석결과를 요약하면 다음과 같다. 첫째, 정부의 R&D지원제도는 중소기업의 성과에 영향을 미치며, 재정적-비재정적 지원 방식 모두 효과가 있다. 둘째, R&D 지원제도는 정보의 비대칭성이 내재되는데, 단 비재정적 지원은 유의하지 않았다. 셋째, 정보의 비대칭성이 있을 경우, 기업 성과에 부정적 영향을 미쳤으며, 역선택보다 도덕적 해이의 정도가 더 크다. 마지막으로 정보비대칭성의 매개효과로, R&D지원제도의 효과에 정보비대칭성은 부정적 영향(-)을 미친다.BR 본 연구결과를 종합하면, 중소기업에 대한 자금지원방식은 효과성이 높으나, 정보의 비대칭성도 그 만큼 높다. 반면, 비재정적 지원 방식(교육, 정보지원, 사업화 등)에 있어서 비대칭성이 낮게 발생하는 것을 도출하였다. 이와 같은 연구결과를 바탕으로 정부는 보다 효과적인 R&D지원 방식을 기획하고 모니터링하는데 활용할 수 있다. 또한 정부는 중소기업의 상황과 요구에 따라 지원제도를 개선해 나가고, 다각화 할 수 있을 것이다.

Impact of Organizational Support And Technology Competence In E-Commerce Adoption On SMEs Performance In Jabodetabek Region

E-commerce has changed the ways of doing business in many business sectors, including Small Medium Enterprises (SMEs) sector. However, SMEs encountered varied challenges in adopting e-commerce to their business. This research analyzed organizational support and technology competence in e-commerce adoption on SMEs performance in Indonesia, specifically in Jabodetabek region. A quantitative approach was applied in this study, with a Likert-scale questionnaire as a tool to determine the impact of internal factor regarding e-commerce adoption on the SMEs performance. An ordinary linear regression analysis was conducted to test the hypothesis. The results showed that the variables of organizational support and technology competence simultaneously affect the performance improvement on e-Commerce adoption by SMEs in Jabodetabek region

Strategizing Information Systems: An Empirical Analysis of IT Alignment and Success in SMEs

IT investment is a crucial issue as it does not only influence the performance in Small-Medium Enterprises (SMEs) but it also helps executives to align business strategy with organizational performance. Admittedly, though, there is ineffective use of Information Systems (IS) due to a lack of strategic planning and of formal processes resulting in executives’ failure to develop IS plans and achieve long-term sustainability. Therefore, the purpose of this paper is to examine the phases of Strategic Information Systems Planning (SISP) process that contribute to a greater extent of success so that guidelines regarding the implementation of the process in SMEs can be provided. Data was collected by 160 IS executives in Greek SMEs during February and May 2017. Multivariate Regression Analysis was applied on the detailed items of the SISP process and success constructs. The results of this survey present that managers should be aware of the strategic use of IS planning so as to increase competitive advantage. Senior executives should choose the appropriate IT infrastructure (related to their business strategy and organizational structure), so as to align business strategy with organizational structure. The findings of this paper could help IS executives concentrate their efforts on business objectives and recognize the great value of the planning process on their business.

The Proposed Dashboard Model for Measuring Performance of Small-Medium Enterprises (SME)

The era of free market and the more dynamic environment condition forces many companies to establish the proper strategy. Implementation of a correct strategy can increase the effectiveness and efficiency of the use of the company resources. The system of measuring performance is one of models used to monitor the success of implementing objective strategy which has been determined by the leader of the company, including SME (small- medium enterprise). However, a lot of SME do not have clear vision and strategy. It is because the SME orientation only focuses on more dominant operational performance. Therefore, smart system can be used to arrange a parameter of performance measurement. AHP (Analytic Hierarchy Process) is used to determine the priority from each criterion from KPI (Key Performance Indicator). Knowing the proper need, the company can determine the priority to select if the company has limited fund and resources. Moreover, the assessment system used in this research uses OMAX (Objective Matrix) method for each KPI. To assess, the measurement uses the concept of traffic light system using 3 colors: green (achieving a target), yellow (close with the target), and red (far from target). Nevertheless, this KPI needs to get attention in the next period. The research observes 3 SMEs located in Krebet tourism village. They are SME Ragil Handicraft, SME Sanggar Punokawan and SME Yuan art. The result shows that there are 31 keys performance indicators (KPI) used to measure the performance of SME. The assessment result of OMAX shows that there are still a lot of KPIs with red color. Thus, they need to be repaired. Knowing the performance of SME still far from target (red), the sources of the problem can be identified, so that the reparation target done by SME is more appropriate.

Multidimensional Health Locus of Control and Performance in Small Medium Enterprises (SMEs)

There is increasing evidence that entrepreneurs' well-being matters. Yet, despite this, insights into how entrepreneurs manage their well-being remain limited. Utilizing a social learning perspecti...

Measuring Financial Performance of Student Enterpreneur’s Business

This research tries to explain the financial performance of several SMEs (Small Medium Enterprises) owned by our students. They are living examples of student that run business since in undergraduate program. The discourse to boosting SMEs cannot neglect problems related to financial performance. We obtained the result that the all financial statements showed good performance. Even though there were excess funds that the entrepreneurs not maximally used. We suspect they are doing it as a caution because they are still beginners in the business world. The businesses getting most profit are those who sell staple food substitutes. This phenomenon is because these types of foods are already familiar to most people’s tongues. While businesses that focus on drinks with specific targets, it turns out shows smaller profits and even the lowest among others. However, in total, they showed their ability as entrepreneurs, even though on a small scale.

Factors Affecting Economic Performance of SMEs in Mongolia

The performance of Small Medium Enterprises (SMEs) play important role in economic development of a country, and it has been widely discussed that SMEs are the driving engine of economic development. In other words, by growth of SMEs, economy will be diversified, private sectors will be strengthened, unemployment will be decreased, technology and production will be improved. For SMEs in order to grow, sustainable economic performance is needed. The aim of this study is to identify the main factors affecting the economic performance of SMEs in Mongolia, make recommendation to improvement of the economic performance so that SMEs in Mongolia further influence the growth. This study uses data collected from World Bank Enterprise survey, and will use quantitative method to analyze the factors affecting the economic performance. The result of the study will be helpful for SMEs to orient itself and for policy makers. Keywords: Small & Medium Enterprises (SMEs), Mongolia, Economic Performance DOI : 10.7176/EJBM/11-21-16 Publication date :July 31 st 2019

Examining Enterprise Resource Planning Post Implementation and Employees’ Performance in Small and Medium Enterprises Using DeLone and McLean’s Information System Success Model

This study examines the effect of Enterprise Resource Planning (ERP) post implementation on employees’ performance in Small Medium Enterprises (SME) in Malaysia. Specifically, this study relies on the DeLone and McLean’s information system success model that proposes three quality dimensions namely, system quality, information quality and service quality in examining the effect of ERP post implementation on employees’ performance in SMEs. Using a questionnaire survey on 117 respondents that have experience in ERP, this study shows that out of the three qualities of ERP, system quality and service quality have a significant positive effect on employees’ performance in the SMEs. This study shows that information quality does not have a significant effect on employees’ performance in Malaysia. This study contributes to the information system literature and provides information regarding the quality dimensions which could help managers or ERP providers to assess the success of their ERP implementation.

PENGUKURAN TINGKAT IMPLEMENTASI REKOMENDASI HASIL KAJIAN KINERJA LINGKUNGAN PADA LIMA UKM DI SURABAYA

Actually Small Medium Enterprises (SMEs) in the city of Surabaya give negative contributions to the environment. Related to this, two studies have been conducted to help overcome the negative impact. The first stage of the study was analyzed environmental performance of SMEs in Surabaya. As a result of the study, recommendations for activities for SMEs have been formulated to be more pro-environment. The next phase of the second phase of the research, which consists of the level of implementation of the assessment that has been given, the results that can be done regarding the discussion carried out. The results of the second phase of research that discusses the level of implementation of the assessment given to SMEs varies from 50-90%. Thus, SME awareness to make its company a Pro Environment company still has to improve. The formulation of an educational model for SMEs is needed, so that the environmental performance carried out is not limited to passing legislation. Moreover, the performance of the environment implemented by the company is approved, because it provides a larger company and environmental sustainability.

Cittaslow & fast-growing SMEs: Evidence from Europe

It is stressed in the literature that territorial certification critically influences tourist destination competitiveness; however, it remains unclear as to how they influence local Small Medium Enterprises (SMEs) value creation. The research contributes to the literature by testing the relationship between territorial certifications and SMEs value creation. Based on literature review, a research model and hypotheses has been developed. The study used a quantitative analysis based on a sample composed of 1148 SMEs from 128 cities (members of the Cittaslow Association) in 15 European countries. The results highlight the direct relationship between territorial certification and SME performance in terms of both annual sales growth and positive financial performance. However, findings show that the impact of territorial certification on local SMEs enables more rapid results in terms of financial performance as opposed to annual sales growth. The implications for management and local government, considerations for future research, and the limitations of the study are also provided.

Incorporating Social Networks in Business Relationships of Retail SMEs for Better Business Performance

The presence of hypermarkets with modern retail format has impacted the performance of retail small medium-enterprises (SMEs) in Malaysia. The challenges of remaining competitive and the ability to sustain the business have pushed many retail SMEs to cease operations within a short period after commencement. Despite these challenges, retail SMEs can still attain competitive advantage through the strategies of strengthening and maintaining business relationships with their social networks. This study postulates that fostering social networks, specifically on the notion of homophily or similarities among social network members, is able to lure valuable resources needed by retail SMEs in achieving superior business performance. Unfortunately, only few studies have focused on social networks from within the Asian context and many tend to overlook the importance of social networks specifically in retailing. This study also suggests the relationship between value and status similarities of retail SMEs and their ability to coordinate efforts in horizontal relationships. Therefore, this study extends the discussion on the role of social networks towards better business performance of retail SMEs in Malaysia by conceptualizing a framework indicating the importance of value and status homophily on coordination of activities leading to business performance of retail SMEs.

Entrepreneurial Orientation, Business Strategy, and Small Medium Enterprise's Performance

There are determining factors that are directly related to the generation of opportunities that maximize performance of the small medium enterprise (SME). This research paper focuses on a quantitative paradigm to measure the entrepreneurial orientation, business strategy and SMEs’ performance as variables. A causal model was developed from the literature, from which a set of hypotheses was posed and a questionnaire was made. A sample of 95 small and medium entreprise in Denpasar was subject to the questionnaire. The findings suggest, entrepeneurial orientation have the most important effect on marketing performance rather than business strategy. The results are based on a rather small sample of exporting SMEs in Denpasar Bali; therefore, the generalizability of the results cannot be assured. But this study will sheds more light on the little researched themes of entrepreneurial orientations in the context of SMEs.

Factors affecting Firm Performance of SMEs in Malaysia

The study purpose is to identify the impact of factors (entrepreneurial orientation, information acquisition, and information utilization) on firm performance of Small Medium Enterprises (SMEs), in Malaysia. A quantitative method was adopted in this study and responses from 150 respondents that were chosen from the list population of SMEs in Malaysia were used. Regression analysis was conducted to test the hypothesis of study and establish the causal effect of entrepreneurial orientation, information acquisition, and information utilization towards firm performance of SMEs. The findings show that only two factors (information acquisition and information utilization) influence firm performance while entrepreneurial orientation was not found to relate with firm performance. Based on the results, the researcher found that information utilization was the most influence factors on firm performance of SMEs. The researcher suggests that SMEs should strengthening the effective marketing strategy or formulation of their business. Besides that, to improve acquire information of SMEs, they should be creative and innovative. Future study should increase sample size, choose multiple background industry, use qualitative methods or use other factors to relate with the performance of SMEs.