Barriers to the Growth of SMEs: Empirical Evidence from Algeria

  • Ecole des Hautes Etudes Commerciales, Alger, Algérie
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Purpose: This paper aims to study the barriers to SMEs’ growth by the typology of entrepreneurs in the Algerian context. Design/Methodology/Approach: We used the Ahmad and Hoffman model (2007) to determine the different blocking factors. The breakdown of these different barriers is divided into four types, internal barriers, micro external barriers, macro external barriers, and infrastructure barriers in a sample of 57 SMEs located in the Wilaya of Algiers. Findings: The results show that the leaders of Algerian SMEs are mainly of the leadership type favoring independence indefinitely, which constitutes a barrier to growth. There is also a significant link between growth and reinvested earnings, and SME managers reinvest little of this. In addition, SME managers perceive that external barriers influence the growth of their enterprises than internal barriers. Practical Implications: This study contributes to understanding barriers to SME growth by the typology of entrepreneurs in a particular context, which is Algeria. In practical terms, these results determine the barriers or constraints to the growth of our sample's industrial SMEs to allow an objective diagnosis for the main aspects. Originality/value: This article innovates a new research context and adds to the existing literature by presenting new evidence about the obstacles to the growth of SMEs.

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Small and medium enterprises play a vital role in ensuring the continuity and sustainability of economic development as they constitute an important starting point for economic growth, through their ability to provide job opportunities and their role in diversifying the industrial structure and assisting the main structures in production. These institutions operate at the national level and push them towards facilitating and continuity of their work, which made them of great importance in achieving development and embodiment at the national level. This study aims to highlight the role of small and medium enterprises in pushing the economies of countries towards development, through their contribution in various areas of development, as these institutions have become a strategic option and the most practical alternative to achieve balanced growth, and this can only be achieved with real support for these institutions. Small, and medium enterprises are an important element in economic development, as they are considered a major driver of the countries’ economy and a source for creating wealth and satisfying economic and social needs. They contribute to reducing the unemployment rate, raising the gross domestic product, creating an added value to the economy, and increasing the proportion of international trade exchanges. In completing our scientific research, we relied on a questionnaire distributed to small and medium-sized enterprises in the state of Oran. We also used a set of tools represented in the interview and observation. The study was based on 38 small and medium enterprises in the state of Oran. The obtained result showed the validity of the hypotheses. These institutions contribute greatly to the economic and social growth of the state, as we extracted from the obtained results. 68% of the studied sample contributes to raising the gross domestic product by 95% to creating an added value by 95℅, and 11% of the studied sample exports its products outside Algeria, This is what prompted Algeria to rely on small and medium enterprises to ensure strong economic growth, but this sector still has not risen yet to be a source of wealth and an engine for development for Algeria because there are several obstacles facing small and medium enterprises.
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This paper analyzes from a resource-based view the management characteristics of Spanish small and medium enterprises (SMEs) according to their strategic orientation and the consequences in terms of firm performance and business efficiency. The typology of strategies formulated by Miles and Snow has important implications for management, because depending on the strategic orientation adopted—defender, prospector, or analyzer—the firm can emphasize to a great extent some aspects of management, such as technological position, innovation, organizational design, and human resource management. Moreover, these aspects of management can largely determine firm performance and business efficiency. A sample of 1,351 Spanish SMEs provided the data for an empirical test of these issues. The results confirm the expected relationships, revealing, on the one hand, significant differences between prospector and defender SMEs regarding the key factors on which they base their management characteristics and, on the other hand, the different influences that each strategic orientation has on firm performance.
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Contemporary theories of entrepreneurship generally focus on the recognition of opportunities and the decision to exploit them. Although the entrepreneurship literature treats opportunities as exogenous, the prevailing theory of economic growth suggests they are endogenous. This paper advances the microeconomic foundations of endogenous growth theory by developing a knowledge spillover theory of entrepreneurship. Knowledge created endogenously results in knowledge spillovers, which allow entrepreneurs to identify and exploit opportunities.
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The entrepreneur is an elusive character in economic theory due to the difficulty of providing an accurate description. It appears impossible to produce a single definition of entrepreneurship and most theoretical approaches yield operational difficulties. By the same token, most operational definitions are incomplete and cover only single parts of the concept. Numerous empirical studies have examined the effects of entrepreneurship, but few studies have been undertaken in order to summarise the empirical evidence and synthesize the theoretical framework and the empirical results. The objective of this paper is to provide a critical overview of recent empirical research on the relationship between entrepreneurship and economic growth.
Bien que tous les acteurs economiques considerent que la performance fasse partie de leurs objectifs a court, moyen ou long terme, on se rend compte rapidement que celle-ci laisse place a bien des interpretations. Ce n’est pas sans consequence toutefois puisque notre meconnaissance de la conception de la performance, notamment pour les dirigeants de PME, nous empeche de bien saisir leurs trajectoires de croissance, leurs strategies de developpement ou meme leur interet pour prendre de l’expansion sur divers marches, qu’ils soient nationaux ou internationaux. Mesurer la performance par leur rythme de croissance, la taille de l’entreprise ou leur rentabilite financiere permet-il de reconnaitre les chefs d’entreprise qui se distinguent reellement des autres ? Il semble que non d’apres les resultats d’une enquete conduite aupres de dirigeants de PME quebecoises ou le concept proteiforme de la performance ne peut etre apprecie que par plusieurs dimensions fines et complementaires. Par ailleurs, on note egalement l’importance de ces mesures selon les objectifs ou les buts que privilegient les chefs d’entreprise, ceux-ci exprimant leur interet pour la philanthropie, le respect de l’environnement, le developpement local, la preservation de leur independance ou la croissance et la realisation de profits superieurs a d’autres entreprises semblables. Evidemment, cette panoplie d’objectifs se repercute sur la conception de la performance comme il est montre a partir des resultats de l’enquete. Ces resultats sont utiles pour mieux apprecier la diversite des comportements des dirigeants de PME et la forme d’organisation qu’ils mettent sur pied et ainsi supporter les pouvoirs publics dans la definition de differentes actions a leur intention.
The influence of history on an organization is a powerful but often overlooked force. Managers, in their haste to build companies, frequently fail to ask such critical developmental questions as, Where has our organization been? Where is it newt and What do the answers to these questions mean for where it is going? Instead, when confronted with problems, managers fix their gaze outward on the environment and toward the future, as if more precise market projections will provide the organization with a new identity. In this HER Classic, Larry Greiner identifies a series of developmental phases that companies tend to pass through as they grow. He distinguishes the phases by their dominant themes: creativity, direction, delegation, coordination, and collaboration. Each phase begins with a period of evolution, steady growth, and stability, and ends with a revolutionary period of organizational turmoil and change. The critical task for management in each revolutionary period is to find a new set of organizational practices that will become the basis for managing the next period of evolutionary growth. Those new practices eventually outlast their usefulness and lead to another period of revolution. Managers therefore experience the irony of seeing a major solution in one period become a major problem in a later period. Originally published in 1972, the article's argument and insights remain relevant to managers today. Accompanying the original article is a commentary by the author updating his earlier observations.
[fre] La petite et moyenne entreprise requiert des critères de gestion spécifiques, qui tiennent compte de la très grande diversité de ces entreprises. Cette spécificité résulte tout d'abord du caractère global du système de gestion, qui exige d'analyser ensemble les buts, l'environnement, l'organisation et les activités, en dégageant des concepts reliant ces pôles. La spécificité est également due au rôle prédominant de l'entrepreneur. Bien des classifications existent. Nous proposons de distinguer l'entrepreneur préoccupé par un logique patrimoniale et celui préoccupé par une logique de flux. [eng] The small and medium sized entreprise needs specific managerial criteria, taking account of the high level of diversity among those firms. That specificity results from the global character of the management system, needing to analyse together the goals, the environment, the organization and the activities, getting concepts connecting those poles. The specificity is also due the proéminent role of the entrepreneur. Many classifications exist. It is suggested to make a distinction between the entrepreneur focusing on a patrimonial logic, and the other one focusing on a flow logic.
In recent years entrepreneurship has become a buzzword that?s entered the mainstream. Politicians continuously cite its importance and the need to create more entrepreneurial societies, and newspapers and television programmes frequently create themes around successful entrepreneurs. But, the pursuit and development of policies related to entrepreneurship are often hampered by the limited, albeit growing, empirical information relating to entrepreneurship (its size, factors and benefits). Therefore, in the absence of definitions that capture the essence of entrepreneurship, and entrepreneurship indicators that are internationally comparable, policy makers are left somewhat rudderless when it comes to developing policies, particularly when they relate to learning from international best-practice. These shortcomings and the growing importance of entrepreneurship in the policy domain have magnified the need for a sounder basis for internationally comparable indicators of entrepreneurship. This paper provides a framework that is intended to provide that sounder basis. It does so by adopting a holistic approach, and, so, by focusing on the: factors that impede or motivate entrepreneurship (determinants); measures that provide indicators of the state of entrepreneurship (entrepreneurial performance); and, outcomes (impacts) of that performance on the economy as a whole. Each of these three themes provides the overarching structure to the framework, using a standardised OECD definition of entrepreneurship, and, within each, we develop a suite of indicators that provide the basis for quantifiable information to be collected in an internationally comparable way for each of these themes. Cadre pour la présentation et la mesure de l'entrepreneuriat L’entrepreneuriat est devenu un terme incontournable ces dernières années, il est au coeur des préoccupations des décideurs politiques qui soulignent très régulièrement son importance et la nécessité de créer des sociétés plus entrepreneuriales. De même, journaux et émissions télévisées montent fréquemment des sujets autour d'entrepreneurs qui réussissent. Malgré cela, le développement de politiques liées à entrepreneuriat sont souvent entravés par les limites, quoique régulièrement repoussées, de l’information empirique disponible sur l?entrepreneuriat (sa taille, les facteurs l'encourageant et les avantages retirés). Ainsi, l'absence de définition communément admise sur l’essence de l'entrepreneuriat et d'indicateurs comparables au niveau international, laisse les décideurs politiques sans leviers de commande pour développer leur politiques économiques et ce, de façon plus prégnante encore lorsqu'il s'agit d'étudier les meilleurs pratiques internationales. Ces imperfections, ajoutées à l’importance croissante de l’entrepreneuriat sur la scène politique, ont renforcé le besoin de fondements plus solides au niveau international pour des indicateurs sur l'entrepreneuriat. Ce document apporte cette base solide en adoptant une approche holistique. Il rassemble les facteurs qui entravent ou encouragent l?entrepreneuriat (les déterminants) ; les mesures évaluant l'état de l'entrepreneuriat (les indicateurs de performance) ; et les résultats (l'impact économique). Ces trois thèmes structurent le cadre d'analyse et utilisent la définition standardisée de l'OCDE pour l'entrepreneuriat. Pour chacun de ces thèmes nous développons une suite d'indicateurs, donnant ainsi une base d’information statistique à collecter comparable au niveau international.
Considerable debate surrounds the concept of entrepreneurial opportunities. This paper approaches the opportunity concept from an evolutionary market process perspective. It argues that new opportunities for entrepreneurial activity frequently emerge as by-products of market competition. Agents may deliberately or unwittingly create opportunities. Organizational development and the evolution of industries are additional sources of new entrepreneurial opportunities. At the same time, they enable agents to acquire the skills required to exploit these opportunities. Copyright Springer Science+Business Media, LLC 2007
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