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Title: Factors associated with the performance of small firms in Malaysia
Author: Wahab, Kalsom Abdul
Awarding Body: University of Manchester
Current Institution: University of Manchester
Date of Award: 2004
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The main inquiry of this research is why some small firms fail while others survive and grow. In addressing this inquiry, four theories, human capital, social capital, organisation and business strategy, are chosen as the theoretical framework underpinning the study. Two main objectives of the study are (i) developing a survival/failure model (ii) developing a growth model. The investigation focus is on factors that are possibly associated with small firm performance. Traditionally, small firm performance studies use financial ratios as variables or indicators of performance. However, financial indicators may reflect only some perspectives of small firm performance. This is due to the nature of the small firm, which is very much influenced by its owner-manager and environment. Moreover, small firm financial data are not easily accessible, possibly owing to business confidentiality or lack of an appropriate documentation system for research purposes. In view of these situations, a combination of both financial and non-financial performance indicators are used to seek answers to the research questions. Performance is conceptualised into two dimensions, (i) survival/failure and (ii) growth. By using quantitative methods with a hypothetical deductive testing approach, two studies were conducted. Study I (N=320) used secondary data generated from the business plans of the survivors/failures for developing the survival/failure model. In Study II {N=312) survey data gathered through face-to-face interviews were used to develop a growth model. The results indicated that education, . management training, external consultation, experience, motivation and networking (proxies for human and social capital theories) were positively related to small firm survival and growth. Age, size and location of the small finns produced mixed influences on firm performance. Age was found to be negatively related to both survival and growth, while size was found to be positively related to firm survival and growth. Although the results showed that firnls located away from the city were likely to survive, they suggested that the opposite was true for growth-seeking firms, although this relationship was not significant. The produ'ct-market strategies deployed in small films were differentiation-focus, which were found to be highly significant to small firm survival and growth.
Supervisor: Not available Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available