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PROPOSAL: SME CLUSTER. Noor Hazlina Ahmad, PhD School of Management Email: Date: 7 th May 2009. Contents. Definitions of SMEs Unique Features of SMEs Importance of SMEs Some Facts and Figures Current SME Projects @ SOM & GSB

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proposal sme cluster


Noor Hazlina Ahmad, PhDSchool of Management


Date: 7th May 2009



Definitions of SMEs

Unique Features of SMEs

Importance of SMEs

Some Facts and Figures

Current SME Projects @ SOM & GSB

Transdisciplinary Agenda: Avenue for future SME-related research

Towards SME Sustainability

Triple Bottom Line Agenda of SMEs

Some Neglected Issues

Potential SME Research

unique features of smes

have an owner/manager with few generic business skills or a particular technical expertise

  • have personal assets committed as security for the business
  • operate flexibly rather than on a strict observance of regulations
  • have a vision and outlook that is bounded by the skills and experience of the founder/owner and tight resource constraints
  • operate in provincial areas, be a key part of the social fabric of the community

Unique Features of SMEs

importance of smes

Importance of SMEs

  • The significance of SMEs is associated primarily with their role in stimulating economic growth.
  • Other significant contributions of SMEs:
  • Because they are labour-intensive, SMEs create employment opportunities.
  • SMEs enhance regional development and create more equitable income distribution due to their location and ongoing expansion throughout the broader community.
importance of smes1

SMEs play a vital complementary role in relation to larger firms--as suppliers and distributors.

  • SMEs serve as a training ground for developing the skills of workers and entrepreneurs.
  • The presence of SMEs curbs the monopoly power of larger firms and provides the structure of the economy with greater flexibility.
  • Thus, a country can reduce its vulnerability to financial crises by strengthening its SMEs.

Importance of SMEs

some facts and figures

A total of 99.2% (552,849 companies in operation) of all manufacturing and service businesses are SMEs and the majority of SMEs (86.6%) are in the services sector.

  • Employment- SMEs accounted for 56.4% of the total workforce.
  • GDP-SMEs contributed 33% of the total output.
  • Total Export-SMEs contributed 19%.

Some Facts and Figures

(Ref: SMIDEC 2009)


Composition of SMEs in Malaysia

Based on Census on Establishments and Enterprise 2005, out of 99.2% of SMEs, the services sector comprise 474,706 (86.6 per cent), followed by 39,376 (7.2 per cent) in the manufacturing sector and 34,225 (6.2%) in the agriculture sector.


Contribution of SMEs in Services Sector, 2005

*Health include hospital, medical, dental and veterinary services, herbalist, homeopathy and foot reflexology

transdisciplinary agenda avenue for future sme research

Transdisciplinary Agenda: Avenue for Future SME Research

  • Transdisciplinary research is crucial in the context of sustainable development research that emphasizes on the integration among SMEs, the society, and the environment in which they operate.
  • Evidently, the fields of SME and entrepreneurship have lagged behind other disciplines when it comes to including sustainable development concepts in their research agenda, especially in the context of emerging economies (Shaper, 2002).
towards sme sustainability a transdisciplinary agenda

Towards SME Sustainability: A Transdisciplinary Agenda

  • Need to solve the equation between economic growth and SME competitiveness on one hand, and social and environmental issues on the other hand.
  • HOW???
  • Encourage fusion between sciences and arts to meet the economic, social, environmental agenda of SMEs— the principle of “THE TRIPLE BOTTOM LINE”.
triple bottom line agenda of smes

A concept that acknowledges the importance of economic, social, and environmental agenda (Colbert & Kurucz, 2008).

Triple Bottom Line Agenda of SMEs

SOM/GSB-study on the behavioral aspects, perceptions, as well as the practices of SMEs in regards to the 3 bottom lines…


Transdisciplinary research to generate successful and sustainable SMEs



some neglected issues

Some neglected issues…

  • SMIDEC and other government agencies:
  • - concern on financial assistance and other direct support mechanism to assist SMEs.
  • -focus on operational solution.
  • Neglected Issues?
  • social and environmental issues, culture (changing the mindset), globalization, sustainability etc.
  • HOW to tackle these issues…
  • encourage transdisciplinary research on the following research areas…
potential sme research

Potential SME Research

  • Economic Agenda
  • The impact of macro-economic factors on SMEs
  • The role of engineering & computer technology
  • Developing broader markets for rural manufacturing and processing SMEs
  • The role of local government in local economic development
  • Leadership, social capital, and succession planning
  • Developing financial literacy in SMEs
  • Downsizing/rightsizing and the effects of economic recession
potential sme research1

Potential SME Research

  • 2. Social Agenda
  • Corporate Social Engagement (CSE)
  • SMEs and social inclusion
  • Social constructionism and SMEs
  • Ethical and socially responsible SME entrepreneurs
  • Social entrepreneurs
  • Ethnic and women SMEs
  • Workforce issues in SMEs
  • Safety and Health issues
potential sme research2

Potential SME Research

  • 3. Environmental Agenda
  • SME ecopreneurs
  • Green SMEs
  • Energy Conservation in SMEs
  • Waste Recycling Activities in SMEs
  • Use of Renewable Energy Resources in SMEs
  • SME Environmental Management
  • Storage, Treatment, and Disposal of Toxic and Hazardous Wastes in SMEs