Entrepreneurial Orientation, Access to Financial Resources and SMEs’ Business Performance: The Case of the United Arab Emirates

Andrawina L., Amelia M., Rizaldi A.S.

Al Rahma Y.H., Abrar-Ul-Haq M.

Shah S., Al-Malkawi H.

Small and medium-sized enterprises (SMEs) are vital for a country’s economic growth. However, they often struggle with a persistent issue, namely, a funding gap. Alternative finance presents a solution to this problem but remains underutilized due to limited SME understanding and access. This research paper aims to explore the factors that influence small and medium-sized enterprises (SMEs) to access innovative alternative financing models. Through a literature review and conceptual framework, this study identifies the influential factors affecting SMEs’ access to alternative financing options. The research adopts the Technology-Organization-Environment (TOE) model as a theoretical framework to understand the factors that influence SMEs’ access to alternative financing. The TOE framework explains the process of adopting and implementing technological innovations in organizations and describes how it is influenced by technological, organizational, and environmental contexts. This study not only tests the TOE framework for SMEs but also extends it by adding the individual context, specifically the financial literacy of SME owners/managers, as a determining factor. The comprehensive conceptual model presented in this study offers a holistic perspective on the factors influencing SMEs’ access to alternative financing and delineates the dimensions of these factors. The model also provides avenues for future research to test and enhance it. This study makes substantial contributions to theory and practice by exploring emerging business models empowered by disruptive technology. This highlights the crucial role of alternative finance in fostering SME growth and underscores the significance of harnessing disruptive technology in creating innovative business models. The findings of this research are relevant to policymakers, regulators, and SME leaders as they provide valuable insights into fostering SME development and ultimately promoting economic prosperity.

García-Almeida D.J., Jóhannesson G.T., Humpe A., Nieves J.

Firm growth is one of the goals of many entrepreneurs in the tourism sector, and its study is in line with Sustainable Development Goal 9. This SDG refers to decent work and economic growth. Firm growth is associated with a positive performance and a sign of the potential long-term survival of the firm. Though many factors can influence the growth of new firms in the tourism industry, knowledge-based factors are particularly emphasised in the academic literature as strong drivers of several dimensions of organisational performance. The field of knowledge management outlines several knowledge-based factors that are strategically relevant for new firms. The goal of this work is to identify knowledge-based aspects that influence the growth of new firms. To that end, we test six hypotheses related to factors identified as significant for firm growth, namely the entrepreneurs’ formal education, their knowledge to start a business, their entrepreneurial network knowledge, and their knowledge to identify opportunities, along with their firms’ product and technological knowledge creation. The analysis is based on data extracted from the databases of the Global Entrepreneurship Monitor (GEM) for 2015 and 2016. In total, 228 new entrepreneurs with new lodging and food and beverage firms younger than 42 months from Spain, Portugal and Nordic and Baltic countries comprise the final sample. A regression analysis was performed to test the hypotheses of this work. Results show the positive impact of the entrepreneur’s higher education and the introduction of process innovation as determinants of the expected growth in those firms.

Bate A.F., Pittaway L.

Entrepreneurial orientation (EO) is a firm-level equivalent of individual entrepreneurship, and its impact on business performance is widely debated in entrepreneurship literature. However, research findings have been inconclusive due to the influence of moderators such as market dynamism and access to capital. This study aims to address this gap by examining these factors and their configurational effects on the EO–performance relationship using data from Ethiopian manufacturing SMEs. The results signal a moderate EO implementation, suggesting a need for industry-tailored EO training that emphasises innovativeness, risk-taking, proactiveness, competitive aggressiveness, autonomy and networking. EO significantly affects business growth, highlighting the importance of enhancing EO practices to improve SME performance. Contrary to normative assumptions, the configuration of high market dynamism, greater access to finance and EO level is not required for superior performance. SMEs can excel in performance even in less volatile environments with reasonable access to finance and EO practices. Thus, maintaining market stability, enhancing finance access and implementing EO can effectively boost a firm’s business performance. The study contributes to understanding the EO–performance relationship by adopting networking as an additional EO dimension, pursuing a configurational approach and employing a blend of PROCESS macro-moderation models and hierarchical linear regression.

Harakati R., Ghazouani I., Hlioui Z.

PurposeIn this study, we aim to define a new ecological financial pecking order. We examine how SMEs' adherence to the environment in the Mediterranean region is impacted by their financial resources and how women Entrepreneurship could play a moderating role in this relationship.Design/methodology/approachOur data are pooled cross-sectional firm level data across 14 Mediterranean countries, with a total of 5,949 observations over the period from 2018 to 2020. We look into the moderating influence of SMEs’ female ownership on the financial sources-environmental engagement link using GLS estimations. To reach our aim we focus on seven funding sources and develop a green engagement construct using JCA. Besides, we distinguish between the least and most environmentally engaged companies in the EU and its neighborhood and compare the different interactions and possible moderations.FindingsResults show that government subsidies foster environmental engagement, followed by supplier credits with a less significant positive impact. The bank credits have the least significant beneficial influence, while non-bank financial institutions have a non-significant effect. We underline that environmental engagements are hindered by the other funds, issued bonds and internal funds.Research limitations/implicationsSMEs in the Mediterranean region, particularly the less environmentally conscious, require strong legal frameworks to enforce environmental responsibility and raise awareness. Integrating less environmentally committed EU SMEs into state subsidy strategies is a chance to improve environmental responsibility in the region.Originality/valueTo our knowledge, there are no prior studies that present a detailed financial structure and environmental management investigation for SMEs within the Mediterranean region while considering the moderating effect of women's entrepreneurship.

Inayatulloh I., Mailangkay A., Deviarti H., Wang G., Hartono I.K., Zarlis M.

Lestari E.D., Abd Hamid N., Shamsuddin R., Kurniasari F., Yaacob Z.

Alnor N.H., Al-Matari E.M., Mohmed T.E., Berradia H.M., Mohamed A.M., Benzerrouk Z.S.

By studying the effect of human resource development on strengthening the firm’s total capabilities this literature review investigates the relationship between the development of human capabilities and company performance by studying the effects of human resource development on strengthening a firm’s total capabilities. To provide a thorough grasp of the subject, the review synthesizes and analyzes pertinent research articles, academic papers, and industry reports. SPSS version 22 statistical software was used for social sciences. Descriptive and inferential statistics were used to analyze the questionnaire data. To attain a lasting competitive advantage, the assessment also emphasizes the significance of fostering a learning culture, adopting cutting-edge procedures, and putting in place efficient training and development programs. The main findings show that investing in the growth of human capabilities has a favorable impact on the success of the company, especially when those investments are made in conjunction with the growth of the organization’s capabilities. Investing in an employee’s skill and capability development boosts productivity, enhances innovation, reduces costs, fosters customer loyalty and satisfaction, and provides a company with a competitive advantage.

Qodriah S.L., Darsono, Riani A.L., Anantanyu S.

Marei A., Mustafa J.A., Othman M., Daoud L., Lutfi A., Al-Amarneh A.

Purpose of the study: The purpose of the study was to discuss the impact of the TOE factors on FinTech Adoption and Financial Performance and the role of organizational readiness as moderation in Jordanian commercial banks.   Theoretical framework: In order to examine how to embrace Fintech and its effects on Financial Performance, this study provides an enhanced technology acceptance model (TOE) that includes relative advantage, top management support, competitive pressure, and technological compatibility.   Method: A questionnaire that we created and distributed to bank managers, department heads, and supervisors working for Jordanian commercial banks yielded 215 valid replies. To test the hypotheses, we used a structural equation model (SEM) to analyze the data and examine the correlations between all latent variables.   Results and conclusion: The results reveal that a positive and significant relationship between Relative Advantage, Top Management Support, and Competitive Pressure on Fintech Adoption and technological compatibility has an insignificant effect on Fintech Adoption, Also showed a positive and significant relationship between Fintech Adoption and Financial Performance. The significant moderating positive effect of organizational readiness on the relationship between Technological Compatibility and Competitive Pressure and Fintech Adoption. This study also shows that does not have a significant moderating positive effect of organizational readiness on the relationship between Relative Advantage, Top Management Support, and Fintech Adoption.   Search implications: The study's findings imply the need for further research and exploration into FinTech Adoption to improve the financial performance of commercial banks to remain competitive in the market. Originality value: This research contributes to integrating the adoption of Fintech's trust with TOE, this study adds to the body of knowledge on the usage of Fintech in banks by offering a more thorough understanding of the factors that influence users' views.

Abdelwahed N.A., Soomro B.A.

The COVID-19 pandemic and its different waves brought several complications to people’s social lives and massively affected business activities worldwide. Accordingly, in this study, we explored the various COVID-19 threats, uncertainties, and risks that are faced by entrepreneurship, propensity, and development. We applied a deductive approach in this study and utilized cross-sectional data that we collected through a questionnaire. We based this study’s findings on 320 valid cases. By employing structural equation modeling (SEM), we reveal that factors, such as quality of business environment (QoBE) and access to financial resources (AtFR,) have a positive and significant impact on entrepreneurial propensity (EP). On the other hand, the findings reveal that two factors, namely the uncertainties caused by the COVID-19 pandemic (UoCOVID-19) and the risk perceptions of the COVID-19 pandemic (RPoCOVID-19), have a negative effect on EP. This study’s findings provide valuable information about the COVID-19 pandemic and, on particular, on the development of EP among university students. In addition, this study’s findings guide and support policymakers and higher authorities in understanding the impact of the COVID-19 pandemic and other business-related factors for developing EP. Further, these findings support the creation of conducive business environments even during a global pandemic or another natural disaster. Finally, this study’s findings contribute other empirical evidence to enrich previous research on health, business, and management.

Pinto A.P., Henriques C.M., Cardoso C.E., Neves M.E.

Small companies face significant difficulties in accessing finance, and the use of bank credit and trade credit are the primary sources of financing, specifically in small countries, with little market liquidity, and focused on the banking system, as is the case of Portugal. The main objective of this article is to identify significant drivers of bank and trade credit, as well as investigate the complementary or substitutive relationship between them, considering that both constitute an essential source of financing for small and medium-sized enterprises (SMEs). The sample comprises 5860 companies, and the analysis was performed using panel data methodology (2010–2019). The results suggest that, during the period in which the financial crisis was most felt in the country (2010–2013), companies intensified their demand for trade credit, and in the following years for bank credit. Our evidence does support the substitution hypothesis between trade and bank credit.

Bhutto S.A., Jamal Y., Ullah S.

This study investigates the role of service innovation as a mediator between FinTech adoption and firm growth. Furthermore, the study also explores the role of human resource competency in FinTech adoption. Survey questionnaires were given to participants in this study, which used a quantitative methodology and were distributed to fifty-five United States banks. A sample of 311 responses was collected and analyzed using Structural Equation Modeling (SEM). The results show that human resource competencies such as creating, adapting (to change), deciding to initiate action and interpreting analysis positively impact FinTech adoption. This study also discovered that service innovation contributes to firm growth. The findings confirmed the influence of human resource competencies on FinTech adoption in banks. This study suggests implementing effective human resource practices to develop employee competencies. Employee performance can be optimized to impact service innovation and business growth, which promotes the adoption of FinTech. The research adds to the body of knowledge already available by providing evidence of mediating role between FinTech adoption and firm growth.

Alnassai J.M.

A variety of factors have an influential impact on how an enterprise develops. This study examined factors that operate as market barriers to entrepreneurship in the United Arab Emirates. These factors are fear of failure, risk aversion, lack of social networking, lack of resources, political instability, and economic instability. A survey-based approach framework was used. This survey recruited 150 participants, including UAE students, business owners, and budding entrepreneurs. Multiple-item survey questionnaires and secondary data were used in the data analysis process to identify and evaluate the barriers preventing people from starting new businesses and becoming entrepreneurs in the United Arab Emirates. According to the research results, fear of failure, risk aversion, and lack of resources in the United Arab Emirates make it difficult for business owners to launch brand new business ventures.