Small and Medium-Sized Enterprises Essay -- International Development

INTRODUCTION1.1IntroductionSmall and medium-sized enterprises (SMEs) fix been identified as one of the growth engines for various countries in the world, since SMEs befuddle up over 90 per penny of all enterprises. For instance, United States, 99.7 per cent (Heneman, Tansky, & Camp, 2000), China, 99 per cent (Cunningham & Rowley, 2008), Europe, 99 per cent (Andreas Rauch & Frese, 2000), Holland, 95 per cent, Philippines, 95 per cent and Taiwan, 96.5 per cent (C. Y.-Y. Lin, 1998) as well as Malaysia, 99.2 per cent (Man & Wafa, 2007 National SME discipline Council (NSDC), 2009 Saleh & Ndubisi, 2006). The figures above show that countries all over the world recognized SMEs as a key business sector. Besides, Asia-Pacific Economic Cooperation (APEC) (2002) pointed out that SMEs are deemed as a supporter to larger enterprises as well as an meaning(a) foundation in expanding business activities and sustaining economic growth. SMEs even provide much jobs than large companies (APEC, 200 2 Department of Statistics Malaysia (DOSM), 2007 NSDC, 2009). In sum, SMEs do a vital part and contribute to the economy and are likely to be increasingly beta as the economy becomes more global.In Malaysia, SMEs are considered as the sticker of industrial development (NSDC, 2009) and give meaningful contributions to the national economy. Hashim (2010) stated that SMEs play a significant role in generating more employment, economic outputs, income generation, exporting capabilities, training, encouraging competition, introduction and promoting entrepreneurship and supporting the large-scale industries (LSIs) as well. Moreover, Jaswant Singh, Malaysian industrial Development Authority director in Australia (MIDA Australia), informed that the grow... ...t improve dexterity and effectiveness (J. Barney, 1991 Wernerfelt, 1984).However, in examining other variables, researchers found a significant kindred between HRM practices (Jimenez-Jimenez & Sanz-Valle, 2008 Nasution, Mavon do, Matanda, & Ndubisi, 2010) and EO (Nasution et al., 2010) towards organisational innovation. Other studies as well as found that there is an irrational result on the relationship between organisational innovation and organizational performance (Rosenbusch, Brinckmann, & Bausch, 2010). These findings propose that potential researchers could study the mediating effect of organizational innovation on the relationship between HRM practices, EO and organizational performance. It is also suggesting that, there also have a moderator effect (managerial ties) on the relationship between organizational innovation and organizational performance.