Goal Setting, Systematic Planning, and Small Firm Performance: Are the Relationships Contingent on Persistence?

Andargachew Baylie, Dr. Manjit Singh

Abstract


The purpose of this study is to examine the effect of personal entrepreneurial competencies (goal setting, systematic planning and monitoring and persistence) on business performance in small and medium enterprises (SMEs) in Amhara Regional State, Ethiopia. In addition to individual main effects, the combined effect of entrepreneurial competencies on business success is examined. A sample of 462 Ethiopian SMEs owner-managers participated in this study. The structural equation modeling was used to test the proposed SMEs performance model. The findings of the present study well suggest that the personal entrepreneurial competencies exhibited by the SMEs owners were the determining factors for the performance of SMEs. In addition to main effects, the effect of systematic planning competency on business performance was more strongly evident when the business owners exhibit a considerable level of persistence competencies. Business owner-managers with motivational goals, plans and hard work (persistence) are able to look for opportunities, assess and exploit them to generate acceptable business outcomes. These resources are important to facilitate small business success particularly when the business owners possess a considerable level of these resources and integrate them for the pursuit of business success. Success in business results from a combination of inspiration and hard work. These core competencies are key characteristics of successful businesspeople that enable them to convert an entrepreneurial vision into successful products or services that are required to meet or surpass market needs. Limitations of the present study are discussed and future research is also recommended.


Keywords


Small firm performance; goal setting; systematic planning; persistence

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