Is Mandatory Nonfinancial Performance Measurement Beneficial?

Gallani, Susanna; Kajiwara, Takehisa; Krishnan, R. S.

doi:10.2139/ssrn.2642914

Cited by 6 publications

(5 citation statements)

References 71 publications

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“…Fitzsimmons et al (2005) suggest that there is an identifiable growth profit trade-off, where to finance growth, the firm must forego profits. Gallani, Krishnan and Kajiwara (2015) investigated this relationship between growth and profitability and found little evidence of the growth versus profit trade-off. He suggested that there is potential for a cumulative type effect whereby profits engender growth and growth engenders future profit that allows some firms to continually face increasing returns to scale.…”

Section: Growth Of Smesmentioning

confidence: 99%

Credit Accessibility and Growth of Small and Medium Enterprises in Bujumbura, Burundi

Delphin,

Awolusi

2023

JEBS

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The purpose of this study was to investigate the effect of credit accessibility on the growth of small and medium enterprises in Bujumbura, Burundi. The study was guided by the following objectives: i) to determine the effect of creditworthiness to credit accessibility on the growth of SMEs in Bujumbura; ii) to establish the effect of business characteristics to credit accessibility on the growth of SMEs in Bujumbura, and iii) to examine the effect of information available to credit accessibility on the growth of SMEs in Bujumbura. The study employed a descriptive survey research design. The target population was 347 and the sample size determined using the Slovenes formula was 186, but 167 respondents participated successfully in the study. The research instrument was a questionnaire and data were analyzed using frequency and percentage tables, mean and standard deviations, and linear and multiple regression analyses. The study found that creditworthiness to access credit had a significant effect on the growth of SMEs (Adjusted R2=0.059, p=0.001). In addition, the study revealed that business characteristics to access credit had a significant effect on the growth of SMEs (Adjusted R2=0.242, p=0.000). Furthermore, the study revealed that information available to access credit had a significant effect on the growth of SMEs (Adjusted R2=0.116, p=0.000). The study concluded that credit accessibility significantly affects the growth of SMEs. Thus, the study recommended that the owners of SMEs should strive to ensure that they have collateral security and proper documentation before they seek credit from financial institutions, SMEs should also form and register an association that is recognizable by law in Burundi. Likewise, the owners of SMEs should seek the support of professional auditors to audit their books of accounts at least every year.

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Section: Growth Of Smesmentioning

confidence: 99%

Credit Accessibility and Growth of Small and Medium Enterprises in Bujumbura, Burundi

Delphin,

Awolusi

2023

JEBS

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“…There is no standard performance measure with the SMEs domain. Many studies suggest that it would be better to use both financial and non-financial measures [47][48][49][50][51][52][53]. While financial indicators such as sales and profit growth capture short-term changes calculated annually, non-financial performance such as knowledge acquisition and new products or services developments highlight longterm improvements [53].However, it is argued that non-financial performance measures provide a clearer overall view of performance needed by decision-makers [54].…”

Section: Smes Performance Operational Definitionmentioning

confidence: 99%

Economic Anxiety and the Performance of SMEs during COVID-19: A Cross-National Study in Kuwait

et al. 2022

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The focal aim of the project was to assess the economic anxiety (EA) and the performance of small and medium enterprises (SMEs) during partial and full lockdowns in Kuwait. The challenges facing the SMEs during COVID-19 and the potential solutions were also explored. The call for this vital investigation was due to the global economic fallout and the shocking drop within the marketplace caused by the COVID-19 pandemic. A descriptive approach was used for online survey design to collect datasets from 147 SMEs spanning all governorates of Kuwait in the period between March and June 2021. It included sociodemographic data, economic anxiety perception, potential challenges and solutions to SMEs, and SMEs’ performance. The data analysis using SPSS 25 showed that 78.2% of the SMEs were affected directly by the COVID-19 pandemic, and about 83% were affected negatively by the COVID-19 pandemic. In comparison, only 12.2% experienced a positive impact, mainly medical, technology, social media, food supplies, and delivery or logistics industries. With great concerns of SMEs for all dimensions related to economic anxiety (with an average of around 3.95), the greatest concerns were the financial and cash flow, followed by labor shortage (an average between 4.51 and 5.00). The results also showed that most of the performance indicators for the SMEs were low (with an average of less than or equal to 2.5), and more than 66% of them worked fewer hours during the pandemic; the number of operating hours was dropped dramatically. More than 74% of the SMEs used technology in more than 20% of their activities, representing an increase in using technologies of about 44%, and about 25.2% used social networks in more than 80% of their activities. The performance of SMEs is also found to be significantly and positively correlated with the economic anxiety levels, with a correlation coefficient of 0.186. The findings revealed significant and crucial outcomes for policymaking, decision-makers, and governmental agencies to build recovery plans and proper actions needed to manage the consequences caused by the disaster against the economic and other developments within the context of SMEs. Overall, there is a clear need to find ways and customize operations to adapt to the new work modes that require social distancing, online operations, and site management. In addition, new alternative modes of SMEs work follow to compensate for the lower working hours from the office and increased online working from home.

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“…Based on that view and some previous research as described above the author makes a guess or hypothesis namely: Hypothesis 2: Learning orientation has a positive impact on company nonfinancial performance 2.5 The impact of company non-financial performance on company financial performance According to Atkinson et al, (1997) the main purpose of a company in doing business one of them to achieve financial and non-financial benefits. Gallani et al (2015) in his article on the Harvard Business Review said that non-financial performance is a good indicator of the company's long-term financial performance. It is also supported by a statement from (Kaplan, 2012) that nonfinancial performance is important in achieving profitability, competitive strength and long-term strategic objectives.…”

Section: 4mentioning

confidence: 99%

“…Other researchers Prieto and Revilla (2006) explain that the role of non-financial performance to be a driver in improving the company's financial performance. While individuals within the company are learning by making behavioral changes and actions toward better ones such as having a commitment to learning, shared vision and open mindedness, this will certainly lead to improvements in non-financial performance aspects (Gallani et al, 2015).…”

Section: Company Non-financial Performance Mediates the Relationship ...mentioning

confidence: 99%

“…Some of these studies include Li and Li (2006) using knowledge management, (Calantone et al, 2002;Nybakk, 2012;Serna et al, 2016) sees a direct influence between learning orientation on financial performance (Wang and Wei, 2005;Prieto and Revilla, 2006;Kaplan et al, 2014;Amin, 2015). Referring to research (Kaplan, 2012: Gallani et al, 2015 it is said that non-financial performance can be a mediator and a driver of profitability in financial, competitive strength and long-term strategic goals of the company. Therefore, to cover the existing gap, researchers try to see the mediation role of non-financial performance between learning orientation and financial performance.…”

Section: Introductionmentioning

confidence: 99%

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The Mediating Role of Company Non-Financial Performance and Religiosity as a Moderating Variable Between Learning Orientation and Company Financial Performance

Sanjaya

2020

REVENUE

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This study aims to see the mediating role of non-financial performance between learning orientation and financial performance. Furthermore religiosity has a moderating role between learning orientation and non-financial performance. No relevant profit theory and still limited research that saw the company's performance from both sides of the financial and non-financial to be a gap for doing research. The sample in this study is small and medium enterprises (SMEs) domiciled in Indonesia country. Research method using a Partial Least Square (PLS) 3. The results of this study indicate that the orientation of learning has a positive and significant impact on company financial performance and company non-financial companies. Religiosity has a moderating role strengthen the relationship learning orientation and non-financial performance. Furthermore, this study also gives results that company non-financial performance mediates some of the relationship between learning orientation to company financial performance. Keywords : learning orientation, company financial performance, company non-financial performance, religiosity, SMEs.

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Is Mandatory Nonfinancial Performance Measurement Beneficial?

Cited by 6 publications

References 71 publications

Credit Accessibility and Growth of Small and Medium Enterprises in Bujumbura, Burundi

Credit Accessibility and Growth of Small and Medium Enterprises in Bujumbura, Burundi

Economic Anxiety and the Performance of SMEs during COVID-19: A Cross-National Study in Kuwait

The Mediating Role of Company Non-Financial Performance and Religiosity as a Moderating Variable Between Learning Orientation and Company Financial Performance

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