Service SMEs Research Articles

The Role of Social Banking in the Success and Sustainable Business Continuity of SSMEs

The technological developments in the social economy have significant implications for social banks and are optimistically changing the way social retail banks conduct their business. Social banks can invest in social services for small- and medium-sized enterprises (SSMEs) either to acquire a strategic advantage or out of strategic necessity. With the assistance of a mathematical model, this study tries to identify SME service channels and assess potential impacts on social deposit banks’ performance. In the first stage, the proposed model estimates the predictive capacity of interpretive accounting variables (financial ratios) versus the interpreted accounting variable (future quarterly earnings before taxes (EBT)). Then, in the second stage, the SSME service channels were added to the earnings before tax model in terms of profitability measure, which informs corporate earnings before operating the business to account for the income tax attributed to it for the purpose of estimating their impact on the performance of social banks. According to our findings, the banks are investing in SME services just to validate their investments in SME services as a strategic necessity. SSMEs services do not provide any strategic advantage to any banks in terms of financial or accounting performance or efficiency since the banks are already efficient. Investing in SMEs is a tool for preserving their strategic positions. Therefore, the contribution of this study is focused on the fact that it highlights the impact of financing the social deposit banking industry on institutions, while most studies analyze the vice versa interaction.

The Influence of Organizational Culture Through Intervening Variables of Organizational Behavior on the Performance of the Yogyakarta Cooperative and SME Service Case Study

Abstract. Organizational culture is very important for the progress of an organization or company. A good organizational culture is expected to be able to influence employee performance and organizational behavior. Maximum performance is also expected to have an impact on organizational behavior. This research was carried out at the Yogyakarta Cooperatives and SMEs Service. This research aims to find out whether the organizational culture in the Yogyakarta Cooperatives and SMEs Service has an influence on organizational performance and behavior. The research method used is quantitative, where data is collected through questionnaires with the sampling method used is saturated sampling, the sample used is all employees in the Yogyakarta Cooperatives and UKM Service, totaling 40 people. Apart from using a questionnaire, researchers also conducted interviews to gain more information about the Yogyakarta Cooperatives and SMEs Department. The data analysis used is path analysis. The results of this research provide the conclusion that the organizational culture used by the Yogyakarta Cooperatives and UKM Service is the "SATRIYA" culture, through existing culture and through tests that have been carried out it is concluded that there is an influence between organizational culture on organizational behavior, there is no influence between organizational culture on performance, there is an influence between organizational behavior on performance, and there is no influence between organizational culture through performance on organizational behavior.

Pemanfaatan Media Sosial sebagai Media Pemasaran Jasa dalam Upaya Mendukung Peningkatan Perekonomian pada UMKM Pemancingan Kelapa Gading Rembang

The problem that is often complained of by MSMEs in Rembang is the weak promotion strategy they carry out. According to business actors, one way for the business to grow is by introducing Indonesian local services or products to foreign countries. In this advanced era, business people must be good at using the internet. Websites, blogs, media are the biggest solutions for introducing business to the wider community. Social media is now a big opportunity for business people because social media is a source of information delivery. Instagram is already widely used around us. Everyone can use Instagram happily and easily. Instagram social media can be used as a learning tool, a means of introducing products or services and a means of buying and selling. The object of research in this paper is the Instagram social media accounts of fishing service SMEs in Rembang, Blitar, East Java. Using qualitative methods, it can be concluded that not only large companies can utilize the internet and social media as marketing media, but social media has become the main activity for business people because Instagram can facilitate communication with the public.

Digital market orientation and organizational economic performance of service SMEs

Market orientation is a high-impact factor for the success in the management of SMEs, especially in the digital business era, which is why companies are required to direct their management toward this segment. This study uses the deductive method to measure the relationship between orientation to the digital market and the organizational economic performance of service SMEs in a peripheral region of Colombia under a quantitative methodology. Likewise, the study is of a descriptive correlational type, and non-probability sampling is used for convenience. A sample includes 243 employees at the management level of 158 organizations in the region. The multidimensional MKTOR scale by Narver and Slater (1990) was adapted to measure the digital market orientation scale, while a scale designed and validated by the authors was used for economic performance. The hypothesized constructs were analyzed with the SEM approach using SPSS software and its AMOS complement. The results showed a positive and significant relationship between market orientation and the economic performance of SMEs (0.691, p < 0.00). Next, it was evidenced that SMEs have a low market orientation because they do not have technological tools designed to satisfy the needs of digital clients; they are unaware of the processes of the competition. Although they work in a coordinated manner at the cross-functional level, they show poor organizational performance. AcknowledgmentThe authors thank the Universidad Surcolombiana for their support in the development of the research.

Impact of Search Engine Optimization Dimensions on SME Companies using Online Promotion in Malaysia

This study aims to investigate the influence of Search Engine Optimization (SEO) aspects on Online Promotion among Malaysian SME companies. The literature identifies four SEO dimensions that influence Online Promotion: SEO Connectivity, SEO Competitiveness, SEO Experience, and SEO Techniques. The online survey received 153 responses from Malaysian SME service providers. In addition to descriptive statistics, the data were subjected to Partial Least Squares-Structural Equation Modelling (PLS-SEM) analysis. The proposed framework builds a strong relationship between SEO Dimensions and Online Promotion for Malaysian SME businesses. According to the analysis findings, there is a significant relationship between SEO Competitiveness and Online Promotion for Malaysian SME businesses. In addition, the data found a significant relationship between SEO Experience and Online Promotion. The value of SEO Competitiveness and SEO Experience, as well as the responses to the study, show that these tactics are frequently used in Online Promotion for SME companies in Malaysia. The findings will help company decision-makers enhance their internet presence and reach. It may result in decreased marketing expenses and a rise in new clients, consequently boosting the company's sales revenue.

Factors for the implementation of the circular economy in Big Data environments in service companies in post pandemic times of COVID-19: The case of Colombia.

In emerging economies, Big Data (BD) analytics has become increasingly popular, particularly regarding the opportunities and expected benefits. Such analyzes have identified that the production and consumption of goods and services, while unavoidable, have proven to be unsustainable and inefficient. For this reason, the concept of the circular economy (CE) has emerged strongly as a sustainable approach that contributes to the eco-efficient use of resources. However, to develop a circular economy in DB environments, it is necessary to understand what factors influence the intention to accept its implementation. The main objective of this research was to assess the influence of attitudes, subjective norms, and perceived behavioral norms on the intention to adopt CE in BD-mediated environments. The methodology is quantitative, cross-sectional with a descriptive correlational approach, based on the theory of planned behavior and a Partial Least Squares Structural Equation Model (PLS-SEM). A total of 413 Colombian service SMEs participated in the study. The results show that managers' attitudes, subjective norms, and perceived norms of behavior positively influence the intentions of organizations to implement CB best practices. Furthermore, most organizations have positive intentions toward CE and that these intentions positively influence the adoption of DB; however, the lack of government support and cultural barriers are perceived as the main limitation for its adoption. The research leads to the conclusion that BD helps business and government develop strategies to move toward CE, and that there is a clear positive will and intent toward a more restorative and sustainable corporate strategy.

The Role of Innovation Capability in the relationship between Entrepreneurial Leadership and Innovation Performance in the SMEs Service industry

Drawing on the resource-based view (RBV) and the dynamic capabilities view (DCV), this study aimed to investigate the mediating role of innovation capability (IC) on the relationship between entrepreneurial leadership (EL) and innovation performance (IP). Survey data were collected from 321 middle-level employees in the SME service industry. Structural equation modeling (SEM) was used to assess the proposed relationships. The empirical analysis revealed that entrepreneurial leadership impacted innovation performance directly and indirectly through the mediating role of innovation capability. The current research contributes to both RBV and DCV by proposing and empirically testing how entrepreneurial leaders affect innovation performance. The results from this research suggest that service SME managers can play a crucial role in promoting their firms' innovation capabilities, which, in turn, influences the firms' innovation performance. This study emphasizes EL's innovation effectiveness and the triggering process of innovation capability and provides various solutions for firms to demonstrate leadership and innovation practices in responding to uncertain environments.

Assessment of Factors Affecting the Growth of Small and Micro Enterprise: A Case Study of Eastern Wollega Zone Selected Three Woredas

Micro and Small Scale Enterprise play a crucial role in economic development and social well-being both in developing and developed world. The aim of SME development and the provision of SME services are to enable the entrepreneurs to take advantage of market opportunities and improve the access to skill development opportunities that strengthen entrepreneurial capabilities (UNIDO. 2002). As part of the industrial sector, SMEs are increasingly becoming popular and important in the Ethiopian economy as they would play a decisive role in contributing to employment generation, poverty reduction and the opening of wider distribution of wealth and opportunities (HK HAILU, 2010). In Ethiopia, SMEs Sector is the second largest employment- generating sector following agriculture. In East Wollega zone the majority of the residents are engaged in micro and small enterprise, specifically on trade, service, construction, urban agriculture and manufacturing.

Entrepreneurial Orientation and Open Innovation Promote the Performance of Services SMEs: The Mediating Role of Cost Leadership

In the 21st century, small and medium service firms face difficulty sustaining their performance. Additionally, the literature on entrepreneurial orientation (EO) in SMEs is scarce. Moreover, the role of cost leadership strategy as a mediator lacks researchers’ attention. Therefore, this research aims to examine the relationship between EO and SMEs performance with the mediating role of cost leadership strategy. Based on the contingency theory, a theoretical model has been drawn. A survey approach with a questionnaire technique has been adapted to achieve the study objectives. The data were collected from 283 service SMEs in three states of Malaysia. The Partial Least Square Structural Equation Modelling (PLS-SEM) technique was employed to analyze the empirical data. The study findings highlight that risk-taking and open innovation have no direct relationship with SMEs’ performance. However, through the mediation role of cost leadership, risk-taking and open innovation have a significant association with performance. Furthermore, the findings indicate that proactiveness, competitive aggressiveness, and autonomy have a positive and direct relationship with performance, whereas in the presence of cost leadership, competitive aggressiveness has a partial mediating effect. The empirical findings are helpful to policymakers, researchers, and practitioners.

Effectuation, SME service innovation, and business customers’ value perception

ABSTRACT Despite extensive research focus on the role of resource integration and combination in service innovation, the influence of decision-making logic has not been scrutinized. This study aims to examine the influence of effectuation, a distinct control-oriented decision-making logic, on small and medium-sized enterprises’ (SMEs) service innovation. Based on a survey of Chinese manufacturing SMEs, the findings show that effectuation has an inverted U-shaped relationship with incremental service innovation but a linear positive relationship with radical service innovation. Moreover, environmental uncertainty reinforces the relationship of effectuation with incremental and radical service innovation. Finally, the relationship with business customers’ value perception is positive for incremental service innovation but inverted U-shaped for radical service innovation. The findings offer unique insights into the importance of effectuation for SMEs’ service innovation in uncertain environments, as well as for customers’ value perception in the business market.

Pengaruh Manajemen Bakat Dan Komitmen Organisasi Terhadap Kinerja Pegawai Pada Dinas Koperasi Dan Ukm Provinsi Sumatera Barat

This study in, human labor is the main key to the company's business success because the performance of an employee is needed in developing a company. Aims to determine the effect of talent management and organizational commitment on employee performance at the cooperative and SME service in West Sumatra Province. The population and the sample are 58 people/employees, using the total sample technique because the total population is less than 100. This study uses primary data in the form of interviews, and direct observation of the research object. Tests using instrument testing, descriptive analysis, classical assumption test, multiple linear regression analysis and hypothesis testing with SPSS 22 program tools. The results of this study are talent management has a positive and significant effect on employee performance and organizational commitment has a negative and insignificant effect on employee performance. at the Department of Cooperatives and SMEs of West Sumatra Province.

Informal Finance: A Boon or Bane for African SMEs?

The aim of this study was to ascertain what can be done by the informal finance sector to close the credit gap in order to improve access to finance by SMEs. SMEs are the backbone of many economies as a result of generating employment and improving GDP. Despite playing such a major role in African economies, SMEs have been excluded from the financial systems. The informal finance sector plays a vital role by providing finance to small businesses. The study employed a literature survey with a primary focus on empirical studies that have been conducted in the African context. The study found that, generally, there are two circumstances under which most small businesses depend on informal finance. Firstly, informal finance is used as a last resort by SMEs that fail to access credit from the formal finance sector, owing to, among other issues, information asymmetry, lack of collateral security and perceived high default rates. Further, low financial literacy and the absence of credit bureaus in developing countries also contribute to the failure to access finance from formal institutions. Secondly, some entrepreneurs opt for informal finance even if they are eligible for formal finance as a result of its flexibility, convenience and simple administrative procedures. Notwithstanding the above benefits of informal finance, informal lenders are regarded as exploiting the clients by charging high interest rates. In addition, this sector suffers from limited resources; hence, it fails to fully service SMEs that require larger funding and are not eligible for formal finance. Invariably, all the studies that have been carried out confirm that access to finance is a major obstacle to the growth and development of SMEs. The development and empowerment of SMEs cannot be ignored as an important driver of the developmental agenda of most economies globally. The main policy recommendations that flow from this study, based on the policy syndrome of improving access to finance (financial inclusion) by the SME sector, include (1) the establishment of a suitable regulatory framework which will nurture the informal finance sector while promoting consumer protection, and (2) linking the formal and informal sector. On the other hand, SMEs should improve their risk management practices and also embrace FinTech platforms in order to access credit.

Turning crises into opportunities in the service sector: how to build antifragility in small and medium service enterprises

PurposeThis work aims at investigating the variables that foster antifragility in the context of small and medium-sized service companies (service SMEs).Design/methodology/approachThis work adopts an exploratory approach in order to deepen five examples of service SMEs that were able to change their own business models and to reinforce their strategic position while facing the COVID-19 pandemic.FindingsThe ingredients of antifragility ability include: entrepreneurial orientation, context insightfulness and operational dexterity. This article singles out the resources and capacities backing the blossoming of antifragility abilities in service SMEs. Slack financial resources, many and diverse research-and-innovation partners, operational dexterity, fastness and creativity are included among such resources and capabilities.Practical implicationsCrises may occur frequently in many ways; thus, this work provides some guidance geared to services SMEs in order to increase their level of preparedness for future crises and to nurture their ability to transform them into opportunities.Originality/valueDespite many concepts associated with antifragility have been dealt with in literature such as resilience or agility, antifragility is hitherto underexplored. This article is among the first ones to explore factors fostering antifragility in service SMEs.

Impact of Quality Management Tools & Techniques towards Quality Orientation leading to Firm Performance – A study in the context of service SMEs

Impact of Quality Management Tools & Techniques towards Quality Orientation leading to Firm Performance – A study in the context of service SMEs

Lessons from the COVID19 pandemic: The case of retail and consumer service firms

The COVID-19 pandemic has impacted business operations in every industry and sector around the world. Scholars, practitioners and policymakers continue to engage in understanding the effects of lockdowns, social distancing measures and other restrictions on trade; the impact of government stimulus and support measures, and how businesses have adapted their operations. The dynamic nature of the virus, and the changing socio-political and economic landscape, provide the opportunity for empirical scholarly research examining how retail and service firms have responded to the challenges and potential opportunities presented by the pandemic, and how owner/managers have pivoted in an (often) uncertain trading environment. This paper presents the findings of an applied study involving business owners (N = 268) of SME retail and service firms in the island state of Tasmania, in Australia, during the first wave of the pandemic in 2020. Findings show: (1) despite over 65 per cent of respondents reporting a downturn in revenue during 2020, almost 80 per cent indicated they had confidence in business survival heading into 2021; (2) whilst on average, businesses did not rate the level of environmental hostility as being particularly high, there was a significant correlation between perceived environmental hostility and assessment of business performance and with the level of confidence of business survival; (3) Australian federal government support and other stimulus measures were deemed crucial for business survival during 2020 with three quarters of businesses accessing the ‘JobKeeper’ scheme, and (4) businesses adapted their operations during the pandemic in terms of new products and services, increased marketing, pivoting their use of technology and promoting ‘localness’.

A nexus between green intelectual capital, supply chain integration, digital supply chain, supply chain agility, and business performance

Purpose: This study aims to examine and analyze the nexus between Green Intellectual Capital (GIC), Supply Chain Integration (SCI), Digital Supply Chain (DSC), Supply Chain Agility (SCA) dan Business Performance (BP). It also aims to examine and analyze the mediating influence of several variables: (a) the mediating role of SCI on the relationship between GIC and BP, (b) the mediating role of DSC on the relationship between GIC and BP dan (c) the mediating role of SCA on the relationship between GIC and BP.Design/methodology: Quantitative approach is carried out using a survey to the owners or managers, and owners and managers of courier service SMEs in two provinces, namely East Java and Daerah Istimewa Yogyakarta (DIY). These two provinces are known to have a courier service SMEs in a large amount because of its population density and large business transaction. The number of respondents analyzed are 183 SMEs. This study uses purposive sampling with certain criteria. The approach of the model is using Structural Equation Modelling with AMOS 23.Findings: (1) GIC has a significant positive influence on SCI; (2) GIC does not have a significant positive influence on BP; (3) GIC has a significant positive influence on DSC; (3) GIC has a significant positive influence on SCA; (4) SCI has a significant positive influence on BP; (5) DSC has a significant positive influence on BP; (6) SCA does not have a significant positive influence on BP. The results of mediation analysis conclude that: (a) SCI mediates the influence between GIC on BP; (b) DSC mediates the influence between GIC on BP; and (c) SCA mediates the influence between GIC on BP.Research limitations/implications: Selecting respondents using purposive sampling is feared to not be able to generalize the population in the two provinces, namely East Java and DIY. The study also uses a self-administered survey, especially on assessing business performance, thus it is feared that there might be a bias, although it has been compared to similar competitor SMEs. Courier service SMEs also have limitation in implementing digital SC, thus they do not quite understand the questionnaire asked even though the researcher has provided assistance during the research.Managerial Implication: Companies need to improve GIC and DSC through various strategies and policies such as training, workshop, and other intellectual development routinely and intensively. It can be done by cooperating with other parties such as universities and the government. This step should be taken in order to achieve harmony in all activities of supply chain management (SCM). Companies should also carry out an effective and efficient learning process for companies to move more agile and dynamic, therefore BP can increase sustainably and not static.Theoretical Implication: This study provides a theoretical contribution, especially on the nexus between GIC, SCI, DSC, SCA, and BP. DSC becomes a very interesting strategic aspect when it is implemented in the current era, where all the business process cannot be separated from digital-based technology.Originality/value: Studies in Asia, moreover in Indonesia, which integrates GIC and associate it with business performance mediated by SCI, DSC, and SCA is still rare. In this era, there is a need for an increase of digital competition in all human resources of courier service SMEs in Indonesia, especially when the SMEs have not had a good SCM system. Digital supply chain requires GIC, and they must be fast and agile to adapt to technology and environmental turbulence. Keywords: Green Intelectual Capital (GIC), Supply Chain Integration (SCI), Digital Supply Chain (DSC), Supply Chain Agility (SCA) and Business Performance (BP).

Digitalisation levels of innovation management practices – pilot study of service SMEs in Poland

For many SMEs innovation is essential to survive in a dynamically changing environment. Technological progress, including in particular the more intense use of digital technologies, increasingly pushes companies to take a fresh look at innovation and also indicates the need for changes in approach in the strategy adopted in order to become and stay innovative and competitive. New management approaches, flexibility of operations as well as product- and service-related innovativeness determines SMEs survival and development. As service SMEs start to compete more openly, rather than locally, their owners and managers have to stay alert and ready for changes. As digitization is beginning the factor which strongly influence how innovation processes are or can be implemented, also service SMEs should be actively aware of how digital transformation affects their environment. Emerging digital tools that aim to support the innovation process also influence its possible modifications, bringing a number of possible benefits and optimisations. The main objective of this paper is to expand the understanding of innovation process digitalization level and intensity in service SMEs, based on the pilot study conducted at the end of 2021 in Poland. The analysis was performed in relation to innovation process model, that included its six general stages. The results summarise the digitalisation score of the sample of 350 companies representing various service sector, and present the overview of innovating digitally practices in reference to general engagement in innovation process. The conclusions are drawn in regards to type and scope of digital tools used to facilitate respective activities included in the innovation management.

Why knowledge-based human resource management matters for business service SMEs

Why knowledge-based human resource management matters for business service SMEs

ISPITIVANJE ODNOSA IZMEĐU PODUZETNIČKE ORIJENTACIJE I POSLOVNE USPJEŠNOSTI MEĐU HRVATSKIM USLUŽNIM MALIM I SREDNJIM PODUZEĆIMA

The relationship between entrepreneurial orientation and business performance has been widely researched. However, in scientific literature there is still a need for further clarification when observing the before mentioned concepts, especially within the service SME context. Likewise, when observing this relationship it is necessary to look into the impact of entrepreneurial orientation on individual segments of business performance, i.e. on financial and non-financial constructs. Therefore, the aim of this paper is to explore the association of entrepreneurial orientation and small and medium business performance, while observing performance both as unidimensional and multidimensional concept. Furthermore, the paper tests whether moderation effect of external environment exists between entrepreneurial orientation and business performance among Croatian service SMEs.

High-performance work practices and labour productivity: a six wave longitudinal study of UK manufacturing and service SMEs

This study utilises both evolutionary resource-based view (EBRV) and open systems theory to investigate the long term impact of high-performance work practices (HPWPs) on labour productivity in UK manufacturing and service sector SMEs. We investigate both forward and reverse causality and the moderating role of owner-manager strategic orientation, and whether such relationships are influenced by firm size and age. Utilising a longitudinal data set (a balanced panel) comprising 284 UK SMEs and six waves of data collection over a ten-year time period (2007–2017), we found support for both forward and reverse causality. Prior investments in HPWPs were positively associated with subsequent firm labour productivity and prior labour productivity was positively associated with future investment in HPWPs. The size of the estimated coefficients for these relationships were consistently larger for small firms than for medium sized firms, however there were not significant for firm age. We additionally found that owner-manager strategic orientation towards HR moderated both forward and reverse causality relationships and that this relationship increased over time. The size of the estimated coefficients was larger in small firms compared to medium-sized firms. Overall, our findings support calls to investigate both forward and reverse causality and to better understand potential differences between small and medium sized firms.