Understanding absorptive capacity in Malaysian small and medium sized (SME) construction companies

Purpose – The construction industry is a very important part of the Malaysian economy. The government's aim is to make the industry more productive, efficient and safe. Small to medium-sized enterprises (SMEs) are at the core of the Malaysian construction industry and account for about 90 per cent of companies undertaking construction work. One of the main challenges faced by the Malaysian construction industry is the ability to absorb new knowledge and technology and to implement it in the construction phase. The purpose of this paper is to consider absorptive capacity in Malaysian construction SMEs in rural areas. Design/methodology/approach – The research was conducted in three stages: first, understanding the Malaysian construction industry; second, a literature review on the issues related to absorptive capacity and discussions with the Construction Industry Development Board (CIDB); and third, multiple case studies in five construction SMEs operating in a rural area to validate the factors influencing absorptive capacity. Findings – Nine key factors were identified influencing absorptive capacity in Malaysian construction SMEs operating in rural areas. These factors involved: cost and affordability; availability and supply; demand; infrastructure; policies and regulations; labour readiness; workforce attitude and motivation; communication and sources of new knowledge and; culture. Originality/value – The key factors influencing absorptive capacity presented in this paper are based on validation from the case studies in five construction SMEs in Malaysia. The research focuses on how they operate in rural areas; however, the research results have wider application than just Malaysia. The key factors identified as influencing absorptive capacity can serve as a basis for considering knowledge absorption in the wider context by SMEs in other developing countries.

The use and impacts of bank support on UK small and medium-sized enterprises

This article examines an under-investigated area in relationship banking, i.e. the use of bank advice and support and its impacts on the financial conditions of small and medium-sized enterprises (SMEs). The findings indicate that the characteristics of businesses and entrepreneurs, among other factors, have determinant effects on the use of bank support by SMEs when they make financial decisions. SMEs can alleviate the severity of their financial problems significantly by using bank support more fully, through developing long-term relationships with banks as primary network partners. The article further recognises the value of advice from banks as a substitute for entrepreneurial human capital, especially when bankers use private information to determine the nature and level of financial and non-financial assistance that they are prepared to supply to their clients.

Managing the complexity of information flow for construction small and medium-sized enterprises (CSMEs) using system dynamics and collaborative technologies

With the increase in e-commerce and the digitisation of design data and information,the construction sector has become reliant upon IT infrastructure and systems. The design and production process is more complex, more interconnected, and reliant upon greater information mobility, with seamless exchange of data and information in real time. Construction small and medium-sized enterprises (CSMEs), in particular,the speciality contractors, can effectively utilise cost-effective collaboration-enabling technologies, such as cloud computing, to help in the effective transfer of information and data to improve productivity. The system dynamics (SD) approach offers a perspective and tools to enable a better understanding of the dynamics of complex systems. This research focuses upon system dynamics methodology as a modelling and analysis tool in order to understand and identify the key drivers in the absorption of cloud computing for CSMEs. The aim of this paper is to determine how the use of system dynamics (SD) can improve the management of information flow through collaborative technologies leading to improved productivity. The data supporting the use of system dynamics was obtained through a pilot study consisting of questionnaires and interviews from five CSMEs in the UK house-building sector.

e-Leadership through strategic alignment: an empirical study of small and medium sized enterprises in the digital age

Small and medium sized enterprises (SMEs) play an important role in the European economy. A critical challenge faced by SME leaders, as a consequence of the continuing digital technology revolution, is how to optimally align business strategy with digital technology to fully leverage the potential offered by these technologies in pursuit of longevity and growth. There is a paucity of empirical research examining how e-leadership in SMEs drives successful alignment between business strategy and digital technology fostering longevity and growth. To address this gap, in this paper we develop an empirically derived e-leadership model. Initially we develop a theoretical model of e-leadership drawing on strategic alignment theory. This provides a theoretical foundation on how SMEs can harness digital technology in support of their business strategy enabling sustainable growth. An in-depth empirical study was undertaken interviewing 42 successful European SME leaders to validate, advance and substantiate our theoretically driven model. The outcome of the two stage process – inductive development of a theoretically driven e-leadership model and deductive advancement to develop a complete model through in-depth interviews with successful European SME leaders – is an e-leadership model with specific constructs fostering effective strategic alignment. The resulting diagnostic model enables SME decision makers to exercise effective e-leadership by creating productive alignment between business strategy and digital technology improving longevity and growth prospects.

Project quality management for small and medium enterprises (SMEs) in trade

Managing project quality is becoming focal issue in major enterprises as popular quality programs from International Standard Organization (ISO) such as ISO9000 certification processes gain momentum. Large organizations as well as small-medium enterprises (SMEs) seem to implement this program, albeit for varied reasons. In this paper, we have reported the findings from an action research project conducted in SMEs who are implementing quality management. The findings indicate that external pressures such as regulations, competition and perceived success - defined on their own parameters, may be the drivers and the certification does not necessarily result in better performance. We are in the process of developing a cost-effective guideline/framework - based on this research, for SMEs involved in the certification process. In addition, the results are aimed at informing academia as well as certification bodies of specific concerns with SMEs.

Fostering information security culture in small and medium size enterprises: an interpretive study in Australia

By having an effective organisational information security culture where employees intuitively protect corporate information assets, small and medium size enterprises (SMEs) could improve information security. However, previous research has largely overlooked the development of such a culture for SMEs, and the national context in which SMEs operate. The paper explores this topic and provides key findings from an interpretive Australian study based on a literature review, two focus groups and three case studies. A holistic framework is provided for fostering an information security culture in SMEs in a national setting. The paper discusses key managerial challenges for SMEs attempting to develop such a culture. The main findings suggest that Australian SME owners do not provide sufficient support for information security due to insufficient awareness of its importance and may also be affected by national attitudes to risk. The paper concludes that Australian SME owners may benefit from adopting a risk-based approach to information security and should be educated about the potential strategic role of information technology and information security. The paper also identifies the value and difficulty of promoting a behavioural and learning approach to information security to complement traditional technological and managerial approaches. Implications for theory and practice are discussed.

Intervention strategies to engage small and medium sized enterprise in environmental good practice

Small and medium sized enterprises (SMEs) are an important part of the world economy but they are thought to be responsible for around 60% of all carbon dioxide emissions by businesses in the UK and 70% of all pollution. SMEs often have major problems with limited resources, limited knowledge and limited technical capabilities to deal with their own environmental impact. SMEs exhibit widely differing characteristics and behaviours where environmental issues are concerned. Yet under these conditions they are all expected to engage in environmentally responsible business for the greater good of society. Interventions that encourage good environmental behaviour are often polarised between regulation and legislation at one extreme and voluntary environmental agreements at the other. It is clear that a holistic mixture of interventions is necessary to achieve maximum engagement by all SMEs. This paper categorises the main behaviours observed in SMEs towards environmental issues and develops a selection or 'tool kit' of intervention strategies that might be deployed within each category of SME for maximum effect.