Managerial competencies and performance of small- and medium-sized enterprises : a multiple case study in New Zealand

Abstract

The small-and medium-sized enterprise (SME) sector makes a major contributor to New Zealand in terms of national economy and employment. In order to identify whether, or to what extent, adequate managerial competencies affect SME's performance, this study comprises of two main aspects. The first aspect investigates current SME performance measurements. The second aspect draws on the critical literature and empirical studies in the field of managerial competency theory, in particular, with regard to the SME's context. The research concerns the fact that managerial competency is not something that can be developed in isolation from its context.

In this study, a qualitative research method enabled this study to go beyond the notions of SME management competencies and performance measures to investigate managerial competencies, which are perceived by New Zealand SME's owner/managers as needed for achieving their expectations. A multiple-case study approach was adopted with cases carefully selected in terms of employee numbers and management content. Data was collected by interviews.

The results showed that the individual SME owner/manager has a unique set of goals related to their unique situation. The findings indicated that the financial motive was neither the only, nor the most significant, factor to a SME owner/manager. However, the evidence does not show a significant correlation between the firm maturity, the owners/managers age and education or the SME's owners/managers success criteria. In addition, the evidence from the cross-case content analysis revealed that the SME owner/managers of these nine firms all have a good grasp of the technical and product knowledge side of their work. The findings confirmed the application of the personal competencies. However, the responders have some difficulties in the areas of Meta Competencies and Cognitive Competencies when they were asked about the difficult issues relating to their perceived success. Finally, the study supported the view that the small business sector is characterized by wide and obvious diversity.

Scope and Limitations: The SME owners/managers involved in this multi-site case study were a small, narrowly defined group of proprietors who mayor may not be similar to other small business owners. Those who agreed to participate and allowed the researcher to collect data may, in some way, be different from those who did not wish to participate. These data were indicative of subjects' individual circumstances, which may be entirely different from others' situations. Furthermore, the SME owners/managers may not have shared deeply personal reasons for running their businesses. The researcher, using the qualitative quasi-deductive method, "is striving to generalize a particular set of results to some broader theory" (Yin, 1994, p 36). Statistical generalizations about the population were not made. Therefore, analytic generalizations "in which a previously developed theory is used as a template with which to compare the empirical results of the case study" (Yin, 1994, p 31) were appropriate.