Assessing SMEs’ Sustainable Growth through Entrepreneurs’ Ability and Entrepreneurial Orientation: An Insight into SMEs in Côte d’Ivoire

Abstract

In most countries, small and medium-sized enterprises (SMEs) play a key role in driving sustainable economic growth and job creation; hence, the need to investigate factors (e.g., entrepreneurial factors) that influence SMEs' sustainable growth (SMESG). This study provides an insight into entrepreneurs' abilities (EAs) that affect SMESG in Côte d'Ivoire (a middle-income economy located in the West African region) and an assessment of the extent to which entrepreneurial orientation (EO) influences the EA-SMESG relationship. By using data from 320 Ivorian SMEs, the results of hypothesis testing confirm an association between SMESG and each EA dimension (creativity, risk control, relationship, and opportunity detection ability), learning ability excepted. As for the moderating effect of EO, the innovativeness in entrepreneurship positively and significantly regulates the EA-SMESG relationship; proactiveness positively regulates the relationship between almost all EA dimensions and SMESG; and risk tendency regulates the relationship EA-SMESG for creativity and risk-control ability. Based on major findings, management implications are formulated in relation to promoting SMEs' sustainable growth. For example, in light of the impact of EA on SMESG, development actors can increase the efficiency of Ivorian SMEs through actions aiming at strengthening the abilities of entrepreneurs and managers.Sustainability 2019, 11, 7149 2 of 26 investigated external environment factors affecting the performance of SMEs in Côte d'Ivoire. They found that several external factors ranging from political to economic, technological, socioeconomic and government policies affect the performance of SMEs to a large extent. Later, Diabate et al. [6], through statistical tests, found an association between most firm and entrepreneur characteristics and growth among Ivorian SMEs.The concept of business growth is most often conjointly discussed with another key concept: Entrepreneurship. Entrepreneurship is a set of factors and actions that bring about development [8], which means positive growth, performance or stability. As an essential concept related to entrepreneurship, the term "entrepreneur" refers to the enterprise's owner [9], whose abilities-such as creativity, risk control, learning, building relationships and detecting opportunity-can influence the growth of his/her business [10][11][12][13]. According to Lumpkin and Dess [14], the entrepreneur's ability (EA) is most often captured and influenced by the entrepreneurial orientation (EO) that is the company's posture on entrepreneurship. Studies in both developed and less developed countries concluded that EO generally has a positive effect on the growth of enterprises. Hence, one of the solutions to the problems of SMEs is the adoption of EO.Since the recognition of entrepreneurial factors as growth determinants, practical studies on their impact on business growth have been welcomed everywhere; hence, several studies have been conducted about EA and SMEs' sustainable growth (SMESG). The...

Effect of Organisational Culture on Sustainable Growth of SMEs: Mediating Role of Innovation Competitive Advantage

“…Organisational Culture and Sustainable Growth of SMEs Diabate et al (2019b) confirmed that there is a singnificant relationship between small and mediumsized enterprises sustainable growth (SMESG) and each entrepreneurial ability (EA) dimension such as creativity, risk control, relationship and/or opportunity detection ability) and learning ability accepted. In a similar vein, (Al Badi, 2019) has found that organizational culture was related to the whole society's culture, which has changed over recent years due to changes in lifestyle and consumer behaviour in (Srisathan et al, 2020) reported that there was a significant effect of organizational culture on organizational sustainability in that cultural characteristics maintain the core business competencies in terms of marketing, operations, customer orientation, capital management, and monitoring & evaluation for sustainability (Mohammed et al, 2020).…”

Tax Administration, Tax Incentive and SMEs’ Growth: The Moderating Effect of Firms Size

“…For SMEs' growth, respondents were asked to indicate how their businesses have grown given the current tax administration and incentives on a 5-point Likert scale rated from 1-No improvement-5-Very great improvement (12 items). The items were obtained from empirically validated sources (Nastasiea & Mironeasa, 2019;Wiklund, Patzelt & Shepherd, 2009;Dobbs & Hamilton, 2007;Diabate, Sibiri, Wang & Yu, 2019;Dalrymple, 2004). On measuring tax administration, the respondents were asked to indicate their level of satisfaction with the tax administration items (8 items) on a 5-point Likert scale rated as follows: 1=Not at all satisfied to 5-Extremely satisfied.…”

“…The use of growth as a measure of firm performance is generally based on the belief that growth is a precursor to the attainment of sustainable competitive advantage and profitability (Markman & Gartner, 2002). Growth epitomizes the process of in-depth development and positive improvement that is generally measured through quality, and/or profit improvements (Diabate, Sibiri, Wang & Yu, 2019). Finance, number of workers, quality of labour skills, business expansion/branches, product lines, business innovation, search for improvement, market development, sales revenue, productivity, integration of IT in business processes are key measures of SMEs' growth (Xu et al, 2019).…”

Economic Business Sustainability and Strengthening Human Resource Capacity Based on Increasing the Productivity of Small and Medium Enterprises (SMEs) in Makassar City, Indonesia

“…They create job opportunities and are an important driver of growth in the gross domestic product (GDP). As for the moderating effect of entrepreneurial orientation (EO), innovativeness in entrepreneurship positively and significantly regulates the entrepreneur's ability (EA)-SMEs' sustainable growth (SMESG) relationship; proactiveness positively regulates the relationship between almost all EA dimensions and SMESG, and risk tendency regulates the EA-SMESG relationship in terms of creativity and ability to control risk [34,35].…”