Influential indicators and measurements of mediating and moderating roles on SME performance

Abstract

Overcoming the failure of SMEs has been an important research topic. The critical research finding is that it has verified the essential elements of performance improvement. The authors presented a solution to the research question, “Is there a causal relationship between the effect on SMEs’ success on capacity and business performance?” They analyzed whether the competence of SMEs had a mediating effect between success variables and performance. Secondary effects were empirically studied by converting independent variables to higher-order component (HOC). The second-order variable of management influenced financial, non-financial, and technical performance, and the second-order variable of technology affected technical performance. As a result of introducing demographic variables as a controlling variable for performance, gender and year of establishment showed a moderating effect on technical and non-financial performance. The authors expect to contribute to practical application to SME CEOs and government policymakers, support organizations, academia, and industry.