Development of a performance analysis model for small and medium enterprises in Iran

Various factors were observed to affect small and medium enterprises’performances for their success and failure in business. The main objectives of this study are to identify the critical factors affecting small and medium enterprises (SMEs) performance and modeling the factors. Previous research o...

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Main Author:	Sorooshian, Shahryar
Format:	Thesis
Language:	English
Published:	2012
Subjects:	Business enterprises - Iran Organizational effectiveness - Iran Small business - Iran
Online Access:	http://psasir.upm.edu.my/id/eprint/38562/1/FK%202012%2024R.pdf
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id	my-upm-ir.38562
record_format	uketd_dc
spelling	my-upm-ir.385622015-05-05T05:04:28Z Development of a performance analysis model for small and medium enterprises in Iran 2012-01 Sorooshian, Shahryar Various factors were observed to affect small and medium enterprises’performances for their success and failure in business. The main objectives of this study are to identify the critical factors affecting small and medium enterprises (SMEs) performance and modeling the factors. Previous research on the business success or failure did not provide detailed explanation to SME performances. Particularly, few research has focused on the factors affecting the performance of established SMEs; even though from business environment the need for SME performance analysis system is alarming. Empirical data of this study, were based on extensive survey and interviews. The survey comprised of 20 experts and 321 independent operators in the manufacturing sectors of small and medium industries of entrepreneurs in Iran. Qualitative and quantitative analysis methods were used for data analysis. Specifically interview and structural equation modeling were the main methods of this study. From the findings, a multi-criteria model was built for generic theory of business success in the SME-context. The model consists of two main constructs: Strategy formulation activities (SFA) and strategy administration activities (SAA). There are five latent sub-dimensions which are internal and external environment scanning, strategy formulation, strategy implementation and strategy control. This research found a significant relationship between SFA and SME Performance. Also, from the result reports a significant relationship between SAA and SME performance. The relationship between SFA and SAA was also reported to be significant. The result strongly suggests that entrepreneurs of SMEs should take necessary actions in aligning their strategy administration activities with the requirements of strategy formulation activities. This study improves the existing theories in that it not only establishes a relationship between strategy formulation activities and strategy administration activities, but also it calculates how this relationship impacts the SME performance, using structural equation modeling method. The model provides a structural systematic method for analysis of business strategic management and its impact on performance of the company both in subjective (qualitative) and the objective (quantitative) terms. The main ability of the model is it can analyze SME performance based on observed and latent variables of strategic management using structural equation model and path coefficients. Another ability of the model is it can be used to benchmark, as it can measure the current performance by the use of two generic latent sub-dimensions of performance,which include financial and non-financial (operational and constituency) performance. This study worked with total number of 56 variables (observed or latent), which direct and indirect relationship between these variables and performance of SMEs were systematically analyzed. Series of tests supported validity, accuracy and feasibility of the model, and it was found that nascent and acting entrepreneurs, organizations fostering SME development, financiers, public policy makers, SME advisors, and other stakeholders of SMEs would benefit the most from the model. Business enterprises - Iran Organizational effectiveness - Iran Small business - Iran 2012-01 Thesis http://psasir.upm.edu.my/id/eprint/38562/ http://psasir.upm.edu.my/id/eprint/38562/1/FK%202012%2024R.pdf application/pdf en public phd doctoral Universiti Putra Malaysia Business enterprises - Iran Organizational effectiveness - Iran Small business - Iran
institution	Universiti Putra Malaysia
collection	PSAS Institutional Repository
language	English
topic	Business enterprises - Iran Organizational effectiveness - Iran Small business - Iran
spellingShingle	Business enterprises - Iran Organizational effectiveness - Iran Small business - Iran Sorooshian, Shahryar Development of a performance analysis model for small and medium enterprises in Iran
description	Various factors were observed to affect small and medium enterprises’performances for their success and failure in business. The main objectives of this study are to identify the critical factors affecting small and medium enterprises (SMEs) performance and modeling the factors. Previous research on the business success or failure did not provide detailed explanation to SME performances. Particularly, few research has focused on the factors affecting the performance of established SMEs; even though from business environment the need for SME performance analysis system is alarming. Empirical data of this study, were based on extensive survey and interviews. The survey comprised of 20 experts and 321 independent operators in the manufacturing sectors of small and medium industries of entrepreneurs in Iran. Qualitative and quantitative analysis methods were used for data analysis. Specifically interview and structural equation modeling were the main methods of this study. From the findings, a multi-criteria model was built for generic theory of business success in the SME-context. The model consists of two main constructs: Strategy formulation activities (SFA) and strategy administration activities (SAA). There are five latent sub-dimensions which are internal and external environment scanning, strategy formulation, strategy implementation and strategy control. This research found a significant relationship between SFA and SME Performance. Also, from the result reports a significant relationship between SAA and SME performance. The relationship between SFA and SAA was also reported to be significant. The result strongly suggests that entrepreneurs of SMEs should take necessary actions in aligning their strategy administration activities with the requirements of strategy formulation activities. This study improves the existing theories in that it not only establishes a relationship between strategy formulation activities and strategy administration activities, but also it calculates how this relationship impacts the SME performance, using structural equation modeling method. The model provides a structural systematic method for analysis of business strategic management and its impact on performance of the company both in subjective (qualitative) and the objective (quantitative) terms. The main ability of the model is it can analyze SME performance based on observed and latent variables of strategic management using structural equation model and path coefficients. Another ability of the model is it can be used to benchmark, as it can measure the current performance by the use of two generic latent sub-dimensions of performance,which include financial and non-financial (operational and constituency) performance. This study worked with total number of 56 variables (observed or latent), which direct and indirect relationship between these variables and performance of SMEs were systematically analyzed. Series of tests supported validity, accuracy and feasibility of the model, and it was found that nascent and acting entrepreneurs, organizations fostering SME development, financiers, public policy makers, SME advisors, and other stakeholders of SMEs would benefit the most from the model.
format	Thesis
qualification_name	Doctor of Philosophy (PhD.)
qualification_level	Doctorate
author	Sorooshian, Shahryar
author_facet	Sorooshian, Shahryar
author_sort	Sorooshian, Shahryar
title	Development of a performance analysis model for small and medium enterprises in Iran
title_short	Development of a performance analysis model for small and medium enterprises in Iran
title_full	Development of a performance analysis model for small and medium enterprises in Iran
title_fullStr	Development of a performance analysis model for small and medium enterprises in Iran
title_full_unstemmed	Development of a performance analysis model for small and medium enterprises in Iran
title_sort	development of a performance analysis model for small and medium enterprises in iran
granting_institution	Universiti Putra Malaysia
publishDate	2012
url	http://psasir.upm.edu.my/id/eprint/38562/1/FK%202012%2024R.pdf
_version_	1747811733900099584

Development of a performance analysis model for small and medium enterprises in Iran

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