Measures of small business success/performance: Importance, reliability and usability

Abstract

The main objective of this paper is to assess the reliability of selected measures of success/performance of small enterprises taking into account all the advantages and disadvantages of objective (traditional, financial) and subjective (personal perception) indicators. The realization of the basic objective will enable removal of doubt in different categories of success / performance of small businesses, which would be a secondary objective of the paper. The research methodology involves the use parametric procedures due to the characteristics of the selected variables and the number of observations in the sample. Univariate ANOVA and Pearson's coefficient correlation will be the main methods used. The basis of this study consists of data gathered from e-survey of 260 entrepreneurs/ owners/ managers of small enterprises in administrative sub-region of the Republic of Serbia. The analysis results show the correlation between subjective estimate of success of owners/ entrepreneurs/ managers and objective performance indicators, which can be characterized as complementary, meaning that subjective assessment as well as formally stated performance indicators are realistic. In addition, it is important to emphasize as an important result within the group of objective performance indicators, the differences between two groups, financial and non-financial, performance indicators.

Impact of Logistics Capacity on Economic Sustainability of SMEs

“…Following the review of existing literature about the topic of logistics management in an SME, and possible factors which can have an impact on its business performance, it can be summarized that existing literature focuses on subjects such as economic sustainability of SMEs involved in a supply chain (Jin [38]), logistics capacity of SMEs (Gecse [39]), internationalization of business activities to new markets (Sen and Haq [40]), while certain authors covered market profile of the company and portfolio based factors of business (Hao et al [41]). Meanwhile, previous literature findings, dealing with business performance measures in SME surrounding were mainly focused on financial (Zorn and associates [42]) and non-financial indicators (Leković and Marić [43]).…”

Assessing the Relationship Between BPM Maturity and the Success of Organizations

“…As commercial organizations focus on profit maximization, a set of financial or accounting variables, namely the ones related with profitability and shareholder value, has been widely used to measure their success (Helming et al, 2013;Leković & Marić, 2015). However, this perspective is very limited as an organization is a complex system comprised by its internal and external context.…”

“…Financial performance has been one of the most traditional perspectives to measure the success of an organization. Although the fact that other perspectives have been included in measuring organizational performance and success, the financial perspective is still widely used in the literature, as well as in business practice, and cannot be discarded (Crumpton-Young & Ferreras, 2013;Kaplan & Norton, 2001;Keerthika & Alagarsamy, 2018;Leković & Marić, 2015;Maltz et al, 2003).…”

“…When measuring financial performance, metrics related with growth, profitability and efficiency are often referred in the literature (Crumpton-Young & Ferreras, 2013;Fleck, 2009;Leković & Marić, 2015;Murphy et al, 1996). In fact, the study conducted by Murphy et al (1996) highlights those three dimensions as the most used to measure performance.…”

“…Level of customer satisfaction (Clark, 2007) Internal Performance Human capital Turnover rate (Murphy et al, 1996) Employee growth rate (J. Richard et al, 2009;Leković & Marić, 2015;Murphy et al, 1996) Organizational culture Perception of managers on how strong the culture is (Garmendia, 2004) Quality & risk management Implementation of operational internal audits (Shin, Dahlgaard, Dahlgaard-park, & Kim, 2018) Implementation of risk management procedures (Shin et al, 2018) Sustainability Longevity Number of years company is in business (Murphy et al, 1996) Corporate social responsibility Investment in CSR initiatives on total revenue (Kao, Yeh, Wang, & Fung, 2018) Innovation Investment in R&D and selfinnovation (Kao et al, 2018) Table 4 -Dimensions, categories and metrics to measure organizational success…”