Business Excellence Model for the Business Performance of Small and Medium Enterprises in Malaysia

Abstract

Objective - Small and Medium Enterprises (S.M.E.s), including Malaysia, have been recognized as a critical economic development engine globally. S.M.E.s' economic contribution includes their share of total establishments, employment, Gross Domestic Product (G.D.P.), and total export. Methodology/Technique – S.M.E.s comprise 97.4 percent of business establishments, provide 59 percent of total employment, and are the major contributor to economic growth. Although S.M.E.s play a pivotal role in economic development due to their significant proportion, their business performance remains a topic of debate. The S.M.E.s' business performance has shown slow growth while recording low productivity compared to large firms. This paper aims to develop a comprehensive Business Excellent Model (B.E.M.) that is exclusively and mutually for the business performance of S.M.E.s by investigating each criterion of the Business Excellent Model. Finding – The B.E.M. was developed by reviewing the literature on the issue from local and global contexts. Previous studies have shown that S.M.E.s require a suitable B.E.M. to catalyze their business performance. The S.M.E.s need to have seven criteria which comprise (a) leadership, (b) strategy, (c) information, (d) customer, (e) workforce, (f) process, and (g) results that are exclusively and mutually for S.M.E.s' business performance. Novelty – Finally, the literature's conclusion helps evaluate the critical issues of slow-growing and unproductive S.M.E.s in Malaysia. Furthermore, understanding every criterion of the B.E.M. would also ascertain which measures should be included in the B.E.M. for S.M.E.s. Type of Paper: Review J.E.L. Classification: M10, M11. Keywords: Small and Medium Enterprises; Business Performance; Excellent Business Model; Resource-Based View Theory; Productivity Gap. Reference to this paper should be referred to as follows: Moin, S.B; Bakar, S.B.A; Samat, M.F.B. (2023). Business Excellence Model for the Business Performance of Small and Medium Enterprises in Malaysia, GATR-Global J. Bus. Soc. Sci. Review, 11(1), 18–25. https://doi.org/10.35609/gjbssr.2023.11.1(3)