IMPACT OF SOCIAL CAPITAL TOWARDS STRATEGIC CAPABILITIES OF MANUFACTURING SMEs IN MALAYSIA
Keywords:
Social Capital, Strategic Capabilities, Manufacturing SMEs.
Abstract
Research on SMEs in Malaysia has become more significant nowadays as SMEs in Malaysia contribute national income to the country. Internationalisation of SMEs is imperative as smaller firms operating international business today develop their own capabilities and competitive advantage. Thus, it is important for SMEs especially those in emerging countries like Malaysia to look into their social capital and put their efforts to strategize their capabilities to respond to the global competition and business opportunities. This study was conducted to examine the impact of social capital towards the SMEs capabilities before they adopt the best strategic approach to face challenge situations at hand. A quantitative approach was employed in this study and a total of 187 responses from manufacturing SME exporters were received and further analyzed using Partial Least Square (PLS) technique. The results demonstrated that social capital of manufacturing SMEs in Malaysia has significant impact only on innovation, marketing and technology capabilities but not market-linking and management capabilities.
References
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Chisholm, A. M., & Nielsen, K. (2009). Social Capital and the Resource-based View of the Firm. International Studies of Management & Organization, 39(2), 7-32.
Westerlund, M., & Svahn, S. (2008). A Relationship Value Perspective of Social Capital in Networks of Software SMEs. Journal of Industrial Marketing Management, 37(5), 492-501.
Prester, J. (2015). Intellectual Capital and its Impact on Firm’s Performance, 1-8.
Dhanaraj, C., & Parkhe, A. (2006). Orchestrating Innovation Networks. Academy of Management Review, 31, 659–69.
Bondeli, J. V., Havenvid, M. I., & Solli-Sæther, H. (2018). Placing social capital in business networks: conceptualisation and research agenda. Journal of Business & Industrial Marketing, 1-24.
Bourdieu, P. (1986). The Forms of Capital, in Richardson, J. (Ed.), Handbook of Theory and Research for the Sociology of Education, Greenwood, Westport, CT, 241-258.
Burt, R. (1992). Structural Holes: The Social Structure of Competition, Cambridge University Press, New York, NY.
Chang, W.S., & Hsieh, J. (2011). The Dynamics of Intellectual Capital in Organizational Development. African Journal of Business Management, 5(6), 2345–2355.
Coleman, J. S. (1988). Social Capital in the Creation of Human Capital. American Journal of Sociology, 94, 95-120.
Doh, S., & Acs, Z. (2010). Innovation and Social Capital: A Cross-country Investigation. Journal of Industry and Innovation, 17(3), 241-262.
GAMAGE, S. K. N., PRASANNA, R., JAYASUNDARA, J., EKANAYAKE, E., RAJAPAKSHE, P., GAKNJ, A., ... & Nedelea, A. M. (2020). Social Capital and SME: A Systematic Literature Review and Research Directions. Ecoforum Journal, 9(3).
Houghton, S. M., Smith, A. D., & Hood, J. N. (2009). The influence of social capital on strategic choice: An examination of the effects of external and internal network relationships on strategic complexity. Journal of Business Research, 62(12), 1255-1261.
Ismail, K., Ali Jafri, S.K., Khurram, W., & Soehod, K. (2014). Impact of Social Capital and Firms’ Innovative Capability on Sustainable Growth of Women-owned Technoprises (SMEs): A study in Malaysia, World Applied Sciences Journal, 29(10), 1282-1290.
Johnsen, R. E. (2007). The Role of Focal Suppliers in Strategic Networks for Internationalisation: Perspectives from Small and Medium-sized Italian and Thai Silk Suppliers. Journal of Fashion Marketing and Managenment, 11(1), 135–147.
Khalique, M., Bontis, N., Shaari, J.A.N.,Yaacob, M.R., & Ngah, R. (2018). Intellectual Capital and Organisational Performance in Malaysian Knowledge-Intensive SMEs. International Journal Learning and Intellectual Capital, 15(1), 20-36.
Krishen, A.S., Leenders, M.A.A.M, Muthaly, S., Ziołkowska, M., & La Tour, M.S. (2019). Social Networking from a Social Capital Perspective: A Cross-Cultural Analysis. European Journal of Marketing, 53(6), 1234 1253.
Lin, N., Cook, K.S., & Burt, R.S. (2001). Social Capital: Theory and Research, Aldine de Gruyter, Chicago, IL.
Mazzucchelli, A., Chierici, R., Tortora, D., & Fontana, S. (2021). Innovation Capability in Geographically Dispersed R&D Teams: The Role of Social Capital and IT Support. Journal of Business Research, 128, 742-751.
Mort, G.S., & Weerawardeena., J. (2006). Networking Capability and International Entrepreneurship: How Networks Function in Australian Born Global Firms. International Marketing Review, 23(5), 549–572.
Nahapiet, J., & Ghoshal, S. (1998). Social Capital, Intellectual Capital, and the Organizational Advantage. Academy of Management Review, 23, 242-266.
Parnell, J. A. (2015). Strategic Political Emphasis, Strategic Capabilities and Uncertainty: An Exploratory Assessment of Managers in the United States. Journal of Strategy and Management, 8(1), 41–63.
Prasanna, R.P.I.R, Jayasundara, J.M.S.B., Gamage S.K.N., Ekanayake, E.M.S, Rajapakshe, P.S.K, & Abeyrathne, G.A.K.N.J. (2019). Sustainability of SMEs in the Competition: A Systemic Review on Technological Challenges and SME Performance. Journal of Open Innovation: Technology, Market and Complexity, 1-18.
Rosli, M. M. (2012). Competitive Strategy of Malaysian Small and Medium Enterprises : An Exploratory Investigation. American International Journal of Contemporary Research, 2(1), 93–105.
Senik, Z. C., Isa, R. M., & Ayob, A. H. (2014). A Model for Understanding SMEs Internationalization in Emerging Economies. Jurnal Pengurusan, 41, 25–42.
SME Annual Report 2016/2017. (2017). SME Corporation Malaysia - SME Annual Report 2016_17.
Spirkova, D., Caganova, D., & Bawa, M. (2015). The Social Capital Influence on Enterprise Competitiveness in V4 Countries. Ecic, 314–324.
Subramaniam, M., & Youndt, M.A. (2005). The Influence of Intellectual Capital on the Types of Innovative Capabilities. Academy of Management Journal, 48(3), 450–463.
Sulistyo, H., & Ayuni, S. (2020). Competitive Advantages of SMEs: The Role of Innovation Capacity, Entrepreneurial Orientation, and Social Capital. Contaduría y Administración 65(1) 2020, 1-18.
Wu, X., & Sivalogathasan, V. (2013). Intellectual Capital for Innovation Capability : A Conceptual Model for Innovation. International Journal of Trade, Economics and Finance, 4(3), 139–144.
Chisholm, A. M., & Nielsen, K. (2009). Social Capital and the Resource-based View of the Firm. International Studies of Management & Organization, 39(2), 7-32.
Westerlund, M., & Svahn, S. (2008). A Relationship Value Perspective of Social Capital in Networks of Software SMEs. Journal of Industrial Marketing Management, 37(5), 492-501.
Prester, J. (2015). Intellectual Capital and its Impact on Firm’s Performance, 1-8.
Dhanaraj, C., & Parkhe, A. (2006). Orchestrating Innovation Networks. Academy of Management Review, 31, 659–69.
Published
2021-11-29
How to Cite
Tuah, S. N. A., Ahmad, N. H., & Halim, H. A. (2021). IMPACT OF SOCIAL CAPITAL TOWARDS STRATEGIC CAPABILITIES OF MANUFACTURING SMEs IN MALAYSIA. International Journal of Small and Medium Enterprises, 4(1), 1-11. https://doi.org/10.46281/ijsmes.v4i1.1470
Section
Research Paper/Theoretical Paper/Review Paper/Short Communication Paper
Copyright (c) 2021 Siti Normah Awang Tuah, Noor Hazlina Ahmad, Hasliza Abd Halim
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