Open Access Peer-reviewed Research Article

Managerial capabilities and firms' sustainable performance: Evidence from Chinese manufacturing small and medium-sized enterprises

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Conceptual framework and hypotheses
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Submitted   Feb 13, 2021
Published   Mar 4, 2021
Issue    Vol 2 No 1 (2021)
DOI   10.25082/FMB.2021.01.002

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Seare Asfaha Sebhatu corresponding author
School of Business Administration, Zhejiang Gongshang University, Hangzhou 310018, China

Abstract

This research seeks to address small and medium-sized enterprises (SMEs)’ performance problems by linking dynamic managerial capabilities to firm performance. In today’s dynamic market environment, it is vitally important for managers/owners of SMEs to possess dynamic capabilities. This study limited its focus to three managerial capabilities namely networking, sensing, and innovation with the moderating role of market dynamism. The data collection process and analysis provided findings that revealed that Chinese SME managers/owners effectively employ managerial capabilities in managing their firms. The hypotheses tests resulted in significant positive relationship between the main variables and performance. The moderating variable, however, had a significant effect only on moderating the relationship between sensing capabilities and performance. The findings from this study suggest that SMEs need to improve their knowledge and application of managerial capabilities in transforming their business performance thereby contributing to the national economy. This study contributes to the dynamic capabilities’ literature by adding to the existing research on the subject. It also provides an understanding of how dynamic capabilities are deployed to build up a solid and sustainable firm performance that resists the waves of market upheavals and it is expected to greatly benefit theory, policy and practice.

Keywords
dynamic capabilities, firm performance, small and medium enterprises, PLS-SEM

Article Details

How to Cite
Sebhatu, S. (2021). Managerial capabilities and firms’ sustainable performance: Evidence from Chinese manufacturing small and medium-sized enterprises. Frontiers in Management and Business, 2(1), 74-86. https://doi.org/10.25082/FMB.2021.01.002
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This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

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