Successful Small- And Medium-sized Enterprises Research Articles

Personality-Traits Taxonomy and Operational and Environmental Performance: A Cross-Sectional Analysis of Small and Medium Scale Manufacturing Enterprises

This research aimed to assess the operational and environmental performance of small- and medium-sized enterprises (SMEs) in Nigeria in relation to their adoption of personality-traits taxonomy (i.e., conscientiousness, openness to experience, extraversion, neuroticism or emotional resilience and agreeableness). The survey-based study involved the entire population of SME operators in South West Nigeria, totaling 1842 individuals (i.e., entrepreneurs). Through the use of stratified random-selection methods, a sample size of 420 was chosen. Data was collected, and both structural and measurement models were used to assess it. The results of the study demonstrate that personality traits have a significant influence on how successful SMEs function. The results also demonstrate that personality traits have a positive impact on SMEs’ environmental performance. These findings suggest that sustaining operational and environmental performance may be accomplished by resource allocation, promoting diversity and inclusion, and employing trustworthy assessment methods. To enhance both their overall operational performance and their environmental performance in particular, the study advises SME operators in Nigeria to undertake proper management of personality traits for sustainability. The paper recommends for greater research on this subject and emphasises the necessity of understanding how personality factors impact operational and environmental performance in Nigerian SMEs.

Key factors influencing the sustained growth of high-tech SMEs in South Korea: the perspectives of founder owner-managers

PurposeThis paper explores key factors influencing high-performing, sustained growth, high-tech small- and medium-sized enterprises (SMEs) in South Korea.Design/methodology/approachA qualitative study is adopted to explore seventeen founder owner-managers of high-tech SMEs who sustained consistent employment growth, greater than the industry average, for seven years. Within the sample, those with higher (10% or over) employment compound annual growth rates (CAGRs) over this period are also compared to those with lower rates.FindingsThe study suggests that proactive approaches, such as flexible organization, risk management, fast decision-making and international market entry, are seen as important contributing factors to sustained growth. These findings contribute to a better theoretical and empirical understanding of sustained high-tech SME growth, in a country with a strong entrepreneurial and internationally competitive information technology sector. Also, collaboration across the SME was perceived as making an important contribution to staff development and growth, consistent with stewardship theory.Research limitations/implicationsThe sample is based on successful high-tech SMEs, so there are limitations in extrapolating results to other types of firms, sectors or countries.Practical implicationsKey factors identified in this study can be considered by entrepreneurs seeking to achieve sustainable business. These also provide improved understanding for policymakers into the complexity of factors related to sustained and high growth of technology-based SMEs, which many countries are keen to foster to aid national economic growth.Originality/valueThe research provides new evidence exploring the diverse perspectives of founder owner-managers, on the sustained growth and failure in South Korean high-tech SMEs, and how these have changed since the inception of their business.

The Effect of Halal Certification and Entrepreneurial Marketing on the Successful Small and Medium-sized Enterprises of Food Products

This research aims to examine the effect of halal certification and entrepreneurial marketing on the successful small and medium-sized enterprises (SMEs) of processed food products and investigate the dominant factors affecting the successful business of food products. A quantitative method supported by Structural Equation Modeling Partial Least Square (SEM-PLS) is employed to conduct this research. Seventy-one respondents from SMEs actors of food products registered in the Institute for the Study of Food, Drugs, and Cosmetics of the Indonesian Ulema Council (LPPOM MUI) of Riau Province and had the halal certification became the research sample. They are selected using a purposive sampling technique. This research reveals that halal certification positively affects a successful enterprise, while entrepreneurial marketing, directly and indirectly, positively affect a successful business. In addition, entrepreneurial marketing positively affects halal certification. It interprets that halal certification and entrepreneurial marketing are the significant factors determining the successful enterprise of food products. Furthermore, the dominant factors affecting the successful business of processed food products are the certainty of material quality based on the halal concept and consumer preference (halal certification), the level of ability to weave the relation with government (entrepreneurial marketing), and marketing performance (successful business). So, halal certification and entrepreneurial marketing are the essential factors that have to be considered by entrepreneurs to achieve a successful enterprise of food products. Â

Drivers of SME Resilience in Southeast Asia during COVID-19

Defining and measuring resilience has become a subject of interest in a world characterized by crises. Calls for empirical work on the microeconomic drivers of the resilience of small and medium-sized enterprises (SMEs) have drawn attention to the need for an enterprise resilience index. This paper fills this gap by proposing a multi-dimensional framework for firm resilience. Factor analysis of firm level data from surveys conducted in Cambodia and the Philippines before and during the COVID-19 crisis identifies a set of firm-level factors that drove successful SME performance during the pandemic. Structural Equation Modelling combines these factors into a firm level resilience index and confirms that the index is positively correlated with commonly used proxies of firm performance during crises, such as retaining employees. The insights from the analysis indicate that investment in certain dimensions of firm performance in good times can drive their resilience during crises.

How does innovation matter for sustainable performance? Evidence from small and medium-sized enterprises

This study explores, through the lens of the resource-based view (RBV) and Schumpeter’s innovation theories, the role of innovation in sustainable performance in the context of small and medium-sized enterprises (SMEs) that practice the circular economy (CE). Drawing from the RBV theory, we find that R&D and patents are positively related to sustainable performance. We focus on the internal mechanisms and contingent conditions of the relationships between innovation and social, environmental, and economic performance in achieving the sustainable development goals. The results show that innovation is positively related to social and environmental performance. Meanwhile, R&D investment can improve economic performance. Moreover, the study verifies the mediating role of social and environmental performance, indicating that patents and efficient innovation can indirectly enhance SMEs’ profitability through social performance, while environmental performance does not. Furthermore, firm age and ownership type moderate the relationship between innovation and economic performance. This study extends our knowledge of the relationship between innovation and sustainable performance and provides theoretical guidance for successful SME innovation practices that contribute to sustainable development.

TAKTIK INTEGRATED MARKETING COMMUNICATIONS PADA UMKM PENGRAJIN BATIK SOLO

The research carried out is the application of Integrated Marketing Communication (IMC) which includes digital/internet marketing, sales promotion and personal selling at small and medium-sized enterprises (SMEs) batik craftsmen Solo HR Boutique. This study aims to determine the IMC tactics carried out by batik craftsmen Solo HR Boutique in introducing traditional batik with a modern touch. The method in this research is descriptive qualitative. The data used are semi-structured in-depth interviews and document collection. Miles and Hubermen data analysis is a technique that will be used in this study. The results show that overall IMC tactics used by HR Boutique are interrelated and work well but have advantages and disadvantages. The advantage is that HR Boutique is able to create awareness of its brand so that it can grow positive word of mouth (WOM) and make HR Boutique a successful SME. The drawbacks are the lack of variety and creativity in creating marketing content and the lack of variety of batik designs.Kata Kunci: Komunikasi Pemasaran, IMC, Batik Solo

Model intention to success amongst Muslim SME businesses: an exploratory study and future research

Small and medium-sized enterprises (SMEs) in Malaysia have a significant impact on the economy, contributing 38.3% of GDP in 2022, and so serve as the backbone of the nation. Entrepreneurs' intention to success and their demographic attributes play a crucial role in SMEs' future growth (Delmar and Wiklund, 2008). This paper utilises the theory of planned behaviour (TPB) to analyse and propose numerous determinants of attitude (ATT), subjective norms (SN), and perceived behavioural control (PBC) toward success intention among Muslim SMEs. Further, age, education, and gender to model Muslim SMEs' intention to succeed are also analysed. This study contributes to the understanding of entrepreneurs' intention to success and their demographic attributes that may lead to successful SMEs, in particular among Muslim SMEs in Malaysia.

Weathering the storm: what successful SMEs are doing to beat the pandemic

PurposeThe purpose of this paper is to identify the configurations of working capital and customer and supplier diversification employed by successful small and medium-sized enterprises (SMEs) before and during the COVID-19 pandemic.Design/methodology/approachThis study employed a combinatory methodology to analyze how 124 Brazilian SMEs configured – before and during the pandemic – the size of their working capital and their levels of dependency on clients and suppliers.FindingsHigh levels of working capital and supplier diversification were found to be key to SMEs' ability to thrive before and during the pandemic. However, while SMEs that were growing prior to the pandemic depended on a few major customers, firms flourishing during this time have divided their sales among many clients.Research limitations/implicationsThis study focuses on what configurations SMEs have adopted during the crisis. Qualitative studies are needed to identify how SMEs reconfigure themselves in the face of a major crisis.Practical implicationsThe results of this study indicate that SMEs hit by the pandemic should avoid retrenchment strategies. They might have better chances of success if they embrace their vulnerability and take risks to foster growth.Social implicationsThe results of the study can help SMEs respond to the economic crisis caused by COVID-19, which has already caused the failure of millions of businesses worldwide.Originality/valueThis is the first empirical investigation of SMEs that are weathering the pandemic, and in this study, the authors have analyzed the three aspects of their operations, which have been struck the hardest by the crisis.

Getting Personal: the issues of trust and distrust in small and medium-sized enterprises in Nigeria

There is a pronounced paucity of empirically rigorous study that focuses on the impact of trust on small and medium-sized enterprises (SMEs) operating in a developing market context. This article offers a fresh perspective on the simultaneous relationship between trust and distrust by exploring the complex process through which they are developed. Constructed in the assumptions of multidimensionality and the inherent tensions of relationships, the design of this study is interpretive, following an emergent iterative process, where three distinct types of trust, cognitive-based trust, affect-based trust and calculus-based trust were considered as critical components for successful SME relationships. Conversely, the unpredictable negative behavior of a trade partner was critical to the development of calculus-based distrust and identification-based distrust. The results facilitate a better understanding of the distinct types of trust and distrust that underpin SME relationships in Nigeria and other developing economies, particularly in Africa. This article contributes to the ongoing debate over the two contrary yet complementary opposites of trust and distrust, and their ability to provide explanations to economic activity.

Understanding the connection between SMEs’ competitiveness and cash flow generation: an empirical analysis from Hungary

PurposeThe purpose of this paper is to interconnect the firm level competitive performance (competitiveness) to the financial performance of the firms. The goal is to give evidence on how successful small- and medium-sized enterprises (SMEs) use their financial performance to support their competitive performance.Design/methodology/approachCompetitiveness is interpreted and measured through the resource-based view theory on a wide range of competitiveness measurements with a sample size of 639 SMEs. Financial data originate from official, publicly accessible governmental archives. All data are from a mid-size Central European country (Hungary). To interconnect competitiveness and financial performance, this paper recognizes two types of cash flow, namely, cash flow to the “past” (dividend and debt service) and cash flow to the “future” (CAPEX and innovation). This paper used ordinary least squares regression and binomial logistic regression to analyze connections.FindingsCash flows to the “future” have much stronger effects on competitiveness than cash flows to the “past.” Debt services do not affect competitiveness, whereas dividends, CAPEX and innovation efforts have a significant positive connection to competitiveness, showing that higher cash flow indicates higher competitive performance. If this paper knows how much the firm spends on innovation and dividends, in about the four-fifths of the cases, this paper can predict the level of the competitiveness of the firm without any additional information. The level of these variables gives enough information, the variability of them is not relevant.Research limitations/implicationsThe explanatory power of future-oriented cash flow elements is much higher than that of the past-oriented ones, while innovation dominates all models. Firms with higher competitiveness build their returns in their cost structure, and only when the financial position of the firm is stable enough, withdraw the financial resource based on a long-term plan. The results are limited by the fact that using the current sample, detailed and representative (e.g. cross-industrial, spatial, etc.) decomposition is not possible.Originality/valueLiterature is focusing on how SMEs reach success, how SMEs “earn money.” There is no evidence on how SMEs “spend money,” earned during their success.

Institutional environment and network competence in successful SME internationalisation

PurposeThe purpose of this paper is to examine the impact of institutional environment on the international performance of small- and medium-sized enterprises (SMEs) and how this relationship is influenced by network competence.Design/methodology/approachThis study uses a quantitative approach. In total, 119 internationally operating Finnish SMEs from five industry sectors are sampled via a cross-sectional survey. Data are analysed through regression modelling.FindingsThe international performance of SMEs is influenced directly and indirectly by institutional drivers. The results show that network competence mediates the positive relationship between institutional drivers and international performance.Research limitations/implicationsNetwork capability development can help SMEs leverage more or less favourable institutional environments for successful internationalisation. Perceived institutional drivers directly result in higher performance, but the effect can be partially mediated by dynamic capabilities. The limitations of the study include its single-country context and the cross-sectional nature of the data.Practical implicationsSMEs should take their home countries’ institutional environments into account, but for long-term success, they should develop the ability to manage their business networks. A conducive institutional environment may help develop competence, which in turn can enable more successful internationalisation in terms of scale, scope and satisfaction.Social implicationsDecision-makers may benefit from knowing that, in addition to capabilities, an institutionally conducive environment that drives domestic SMEs towards international markets may be an antecedent of successful internationalisation in the SME sector.Originality/valueThis is one of the few studies to illustrate how network capabilities can mediate the influence of institutional factors on entrepreneurial internationalisation. It combines institutional theory and the dynamic capabilities view to explain successful SME internationalisation.

E-Leadership in Small and Medium-Sized Enterprises in the Developing World

Small- and medium-sized enterprises (SMEs) play an important role in the economies of many developing countries. A critical challenge faced by SME leaders, as digitization continues, is how to adopt digital technologies to create value and enable faster product commercialization. There is a paucity of empirical research examining how e-leadership in SMEs drives technology and new product commercialization processes in the developing world. In this study, we have broadened the notion of what constitutes e-leadership, from the perspective of how advanced information technologies affect the leadership dynamic and the appropriation of advanced information technologies. Although there have been several studies on leading technologies in developed countries, we focus on developing an e-leadership framework for SMEs in developing economies. Using this framework and five selection criteria, we conducted 11 interviews with a sample of successful SMEs selected from a pool of 2,240 firms in the city of Johannesburg, South Africa. We conclude by highlighting the five key findings of this study, which explain how SMEs can develop effective e-leadership to foster commercialization and improve firm performance.

The core competence of successful owner-managed SMEs

PurposeThe purpose of this paper is to measure the impact of transformational leadership, entrepreneurial competence and technical competence on firm performance via innovativeness in owner-managed small- and medium-sized enterprises (SMEs).Design/methodology/approachData were gathered from 178 owner-managers of SMEs operating in Malaysia using a self-report questionnaire. The data were analysed using partial least squares structural equation modelling.FindingsThe results show that, except in the link between transformational leadership and process innovativeness, all relationships linking transformational leadership, entrepreneurial and technical competence with innovativeness, and linking innovativeness with firm performance are significant.Research limitations/implicationsThe self-report questionnaires that were administered to owner-managers of SMEs constitute a limitation for this research, as they may not always produce reliable and valid responses due to single informant response and common method bias.Practical implicationsThe study findings have strong theoretical and managerial implications for owner-managed SMEs seeking to adopt the four core metrics, namely, transformational leadership, entrepreneurial competence, technical competence and innovativeness, as the management core, all of which are necessary for meaningful, sustainable, disruptive transformation to do well in business, even with limited resources.Originality/valueThe value of this study lies in its effort to focus on the core competence of owner-managed SMEs, which remains relatively underexplored in the context of developing countries. Moreover, little is yet known about their combined effects on firm performance.

E-Leadership through Strategic Alignment: An Empirical Study of Small- and Medium-sized Enterprises in the Digital Age

Small- and medium-sized enterprises (SMEs) play an important role in the European economy. A critical challenge faced by SME leaders, as a consequence of the continuing digital technology revolution, is how to optimally align business strategy with digital technology to fully leverage the potential offered by these technologies in pursuit of longevity and growth. There is a paucity of empirical research examining how e-leadership in SMEs drives successful alignment between business strategy and digital technology fostering longevity and growth. To address this gap, in this paper we develop an empirically derived e-leadership model. Initially we develop a theoretical model of e-leadership drawing on strategic alignment theory. This provides a theoretical foundation on how SMEs can harness digital technology in support of their business strategy enabling sustainable growth. An in-depth empirical study was undertaken interviewing 42 successful European SME leaders to validate, advance and substantiate our theoretically driven model. The outcome of the two stage process – inductive development of a theoretically driven e-leadership model and deductive advancement to develop a complete model through in-depth interviews with successful European SME leaders – is an e-leadership model with specific constructs fostering effective strategic alignment. The resulting diagnostic model enables SME decision makers to exercise effective e-leadership by creating productive alignment between business strategy and digital technology improving longevity and growth prospects.

SMEs and public sector procurement: Does entrepreneurial orientation make a difference?

This article illustrates how the proactivity/innovativeness dimension of entrepreneurial orientation (EO) influences how small and medium-sized enterprises (SMEs) search for information on public sector tender opportunities and their subsequent bidding activity. From an analysis of the contemporary literature and our findings, we demonstrate how successful SME participation in public procurement can be encouraged and increased.

Success and failure in turnaround attempts. An analysis of SMEs within the Finnish Restructuring of Enterprises Act

This study focuses on the success and failure of small- and medium-sized enterprises (SMEs) attempting turnaround within Finland's Restructuring of Enterprises Act. In doing so, it aims to shed light on (1) how successful and unsuccessful SME turnarounds differ and (2) the effectiveness of the Finnish regime in promoting SME recovery. A preliminary review of the turnaround literature revealed 23 decline and recovery variables. Data on these variables were collected via a questionnaire sent to the administrators of failing SMEs that entered restructuring. Data from the sample of 228 returns were subjected to factor and logit analysis. The factor analysis finds four decline categories: poor management, high debt in adverse macroeconomy, an adverse microeconomic environment and one-off causes of decline. It also finds three recovery action categories: management change and cash generation, market reorientation and cost-cutting and retrenchment. The logit analysis finds that one-off causes of decline, management change and cash generation and cost-cutting and retrenchment are more important in successful turnarounds and that poor management and an adverse microeconomic environment are more important in unsuccessful turnarounds. The study also finds that the Finnish Restructuring of Enterprises Act has resulted in good rates of business survival. Fifty-four per cent of SMEs in our sample turnaround and survive.

Open Innovation in Practice: Goal Complementarity and Closed NPD Networks to Explain Differences in Innovation Performance for SMEs in the Medical Devices Sector

Cooperation with other organizations increases the innovation performance of organization, especially for small and medium‐sized enterprises (SMEs) as they encounter liabilities of “smallness” (e.g., limited financial resources, and manpower). In the medical devices sector, collaboration with external partners for NPD becomes increasingly important due to the complexity of the products and the development process. About 80% of companies in this sector are SMEs. These companies operate in a highly regulated sector, which affects the organization of the external network required for the new product development (NPD) process. SMEs are practicing extensively open innovation activities, but in practice face a number of barriers in trying to apply open innovation. This paper examines multiple network characteristics simultaneously in relation to innovation performance and thereby aligns with and builds further on configuration theory. Configuration theory posits that for each set of network characteristics, there exists an ideal set of organizational characteristics that yields superior performance. In this research, the systems approach to fit is used. Fit is high to the extent that an organization is similar to an ideal profile along multiple dimensions. This ideal profile represents the network profile that the 15% highest performing companies use. It is argued that the smaller the distance between the ideal profile and the network profile that is used, the higher the performance.The objective of this research is (1) to examine the relation between the ideal profile and innovation performance and (2) to examine which organization of the network profile is related to high innovation performance. Quantitative survey data (n = 60, response rate 61.9%) form the core of this research. The quantitative results are clarified and have been triangulated with qualitative interview data (n = 50).Our findings suggest the presence of an “ideal” NPD network profile (in terms of goal complementarity, resource complementarity, fairness trust, reliability trust, and network position strength): the more a company's NPD network profile differs from this ideal profile, the lower the innovation performance. In addition, the results of our study indicate that the NPD network profiles of successful and less successful SMEs in the medical devices sector significantly differ in terms of “goal complementarity,” while this is less the case for trust and resource complementarity labeled distinctive by previous research. Finally, results show that a relatively closed, focused, and consistent “business‐like” NPD networking approach, which is characterized by result orientation and professionalism, is related to high innovation performance. It is recommended that SMEs in the medical devices sector aiming to distinguish themselves from competitors in terms of innovation performance focus on goal complementarity while adopting such a business‐like attitude toward their NPD network partners.

Organisational, technical and data quality factors in CRM adoption — SMEs perspective

Like large organisations, many Small and Medium-sized Enterprises (SMEs) have implemented Customer Relationship Management (CRM), so that they can compete effectively in today's highly changeable economic and market climate. However, studies indicate that there are mixed results as to how successful SMEs have been in adopting CRM solutions. It is also reported in the literature that CRM implementation is influenced by issues that relate to organisational, technical and data quality factors. To this end, there is limited research conducted in this area which mainly focuses on including these dimension in the evaluation of factors that influence CRM adoption in the SME sector. In seeking to address this issue, this research uses an investigative study aimed at identifying the organisational, technical and data quality related factors influencing CRM adoption by SMEs. This will enhance the quality of the evaluation process, and help support SME decision makers in exploring the implications surrounding CRM adoption. The findings of this study confirm that factors affecting the adoption of CRM in SMEs are largely similar to the factors affecting CRM adoption in previously studied other types of organisations.

Sustaining organisational innovation and learning through external knowledge

This research is on external knowledge or knowledge to be transferred from an external source. It focuses on identifying technical knowledge subjects for Small- and Medium-sized Enterprises (SMEs) operating in the automotive industry. Five considerably successful SMEs participated in the research. Top executives from these SMEs and staff from the Department of Industrial Promotion (DIP) under the Ministry of Industry, Thailand and Thailand Productivity Institute (TPI) took part in the interviews and discussions. Twenty external knowledge subjects transferred to participating SMEs over the span of three organisational life-cycle stages: start-up, growth and maturity. The aims of external knowledge are to minimise process variations, improve performance levels and sustain improvement in the three stages. In addition, it appears that gurus (as a transferring agent) are widely used during the start-up stage, while there are more roles from coaches and mentors when moving towards the maturity stage. The findings and interpretations are useful to SMEs and relevant public agencies. Finally, the limitations and shortcomings are discussed.

Multiple entrepreneurship among successful SMEs in peripheral locations

Multiple entrepreneurship can offer an alternative approach to understanding business growth mechanisms. Despite the growing interest in entrepreneurs who have been involved in more than one venture, few studies have focused on serial and portfolio entrepreneurship. This article explores the prevalence of multiple entrepreneurship among successful small and medium‐sized enterprises (SMEs) in peripheral locations, and compares SMEs owned by multiple business entrepreneurs with SMEs owned by single business entrepreneurs. Multiple business entrepreneurs were defined as SME owner‐managers who are both serial and portfolio owners simultaneously. Among successful owner‐managed SMEs 22 per cent of firms were owned by such multiple entrepreneurs, and only 50 per cent by single business entrepreneurs. The comparison revealed 11 variables that showed differences between these two groups of SMEs. Multiple entrepreneurship was emphasized among entrepreneurs of growth firms. The findings suggest that more attention should be paid to the roles of the multiple entrepreneurs in regional economic development.