Identifying and analyzing factors affecting the excellence and success of small and medium industries using the system dynamics approach

Document Type : Research Paper

Authors

Department of Industrial Management, Yazd Branch, Islamic Azad University, Yazd, Iran

Abstract

Based on the theoretical underpinnings and opinions of industry experts, key variables in the field of new product development have been identified, and cause-and-effect relationships between these variables have been drawn in this study to identify and analyze the dynamics of factors affecting the success of new product development. The intended system has been replicated in the steel industry corporation using the mathematical correlations between these variables that have been established based on the linkages in the backdrop. The strategies of expanding managerial support, investing more in R\&D, and increasing and enhancing product development planning have been recommended to increase the company's performance, and the outcomes of these scenarios have been simulated. The findings indicated that the first level is where the factors related to product development, technology development, research and development activities, the presence of complementary resources, long-term relationships with suppliers, transparent procedures, managerial competence, information sharing, conflict management, risk management, and problem-solving. The second level of the paradigm also includes pursuing power, caving to rivals, inspiring motivation, technical proficiency, technology knowledge transfer, customer happiness, market capacity, and marketing activities. The third level of the model was then used to group the following factors: market penetration, inter-industry compatibility, collaboration, mutual trust, business competence, the appearance of new rivals, change in consumption rate, awareness of environmental concerns, and business competence. This can contribute to the excellence and success of small and medium-sized metal sector businesses.

Keywords

[1] D. Anaraky Ardakani, A. Hassanpour, B. Abdulahi and H. Abbasian, Talent structuring in Iran’s government organizations using the treasury network method, Manag. Dev. Process 104 (2017), 3–26.
[2] B. Asma, A. Diabate and A. Othman, Establishing the factors affecting the growth of small and medium-sized enterprises in Algeria, Amer. Int. J. Soc. Sci. 4 (2015), no. 2, 101–115.
[3] A. Bansal, 5 digital trends that are going to change how SMEs work, The Economic Times, 2019.
[4] H. Bouwman, S. Nikou and M. de Reuver, Digitalization, business models, and SMEs: How do business model innovation practices improve performance of digitalizing SMEs? Telecomm. Policy 43 (2019), no. 9, p. 101828.
[5] J.D. Brown, J.S. Earle and D. Lup, What Makes small firms grow? Finance, human capital, technical assistance, and the business environment in Romania, Econ. Dev. Cultural Change 54 (2015), no. 1, 33–70.
[6] C. Chuthamas, M.A. Islam, T. Keawchana, D.H.M. Yusuf, Factors affecting business success of small & medium enterprises (SMEs) in Thailand, Asian Soc. Sci. 7 (2011), no. 5.
[7] T. Hasangholipour, M.J. Irvani, M.R. Notash, M. Anousheh and S.M. Mousavi Neghabi, Designing the development model of the studied small and medium industries: Food and beverage industries, Manag. Dev. Process 28 (2013), no. 3, 21–46.
[8] S.A. Hosseini, T. Mujibi, A. Mahdizadeh Ashrafi and H. Vazifedoust, The role of business development strategies and policies on the performance of small and medium-sized enterprises (SMEs), Econ. Strategy J. 8 (2018), no. 29, 155–203.
[9] H. Hosseinzadeh and R. Nosrati, Investigating the impact of the development plan of small and early-yielding enterprises on creating employment in selected provinces of the country, Financ. Econ.Policy Quart. 2 (2013), no. 7, 91–108.
[10] T. Kamali and R. Taghizadeh, Identifying and prioritizing factors affecting the success of small and medium enterprises using the process of fuzzy network analysis, a case study: Enterprises located in the districts and industrial towns of Urmia city, Majlis Strategy Magazine 24 (2016), no. 91, 291–318.
[11] T.W.Y. Man, T. Lau and K.F. Chan, The competitiveness of small and medium enterprises a conceptualization with focus on entrepreneurial competencies, J. Bus. Ventur. 17 (2018), no. 2, 123–142.
[12] G.A. Molashahi, S. Zarfian and V. Sarani, Factors affecting the success of small and medium agricultural and horticultural businesses in Zabul city, J. Econ. Res. Agricul. Dev. Iran 46 (2014), no. 4, 739–748.
[13] F. Mugozhi and G. Hlabiso, Determinants of small to medium enterprises’ success or failure: An ex-post appraisal of startup business by young entrepreneurs in Zimbabwe’, Int. J. Humanities Soc. Stud. 5 (2017), no. 3, 39–46.
[14] M. Nasrollahi, M.R. Soltani and A. Farhi, Providing a career development path model, Human Resource Manag. Res. 1 (2017), no. 2, 139–150.
[15] M. Ngibe, L.M. Lekhanya and H.L. Garbharran, Innovative leadership characteristics of manufacturing SMEs in KwaZulu-Natal, Int. J. Entrepr. 23 (2019), no. 4, 1–12.
[16] O.S. Olatunji, The impact of information communication technology on small and medium scale enterprise productivity in Nigeria, Bachelor Thesis, VAASA Univ. Appl. Sci. 2015.
[17] S. Parsapour, J. Barati and M. Rasulzadeh, Factors affecting the sustainability of small enterprises and entrepreneurs under study: Industrial enterprises of Mashhad city, Quart. Sci. Res. J. Entrepr. Dev. 10 (2016), no.
1, 41–60.
[18] D. Pletnev and V. Barkhatov, Business success of small and medium sized enterprises in Russia and social responsibility of managers, Proc.-Soc. Behav. Sci. 221 (2016), 185–193.
[19] R. Prasanna, J.M.S.B. Jayasundara, S.K. Naradda Gamage, E.M.S. Ekanayake, P.S.K. Rajapakshe and G.A.K.N.J. Abeyrathne, Sustainability of SMEs in the competition: A systemic review on technological challenges and SME performance, J. Open Innov.: Technol. Market Complexity 5 (2019), no. 4, p. 100.
[20] C. Rabie, M.C. Cant and J.A. Wiid, Training and development in SMEs: South Africa’s key to survival and success, J. Appl. Bus. Res. 32 (2016), no. 4, 1009–1024.
[21] E.G. Rogoff, M. Lee, and D. Suh, Who done it? Attributions by entrepreneurs and experts of the factors that cause and impede small business success, J. Small Bus. Manag. 42 (2014), no. 4, 364–376.
[22] A. Tarute, J. Duobiene, L. KlovienĖ™e, E. Vitkauskaite, and V. Varaniute, Identifying factors affecting digital transformation of SMEs, 18th Int. Conf. Electronic Bus., ICEB, Guilin, China, 2018.
[23] L. Thulo, South Africa’s SMEs landscape report, SME South Africa, https://smesouthafrica.co.za/sout-africassmes-landscape -report/, 2020.
[24] WTO, The digital economy, GVCs and SMEs, Global Value Chain Development Report 2019, WTO, 2019.
[25] M.G. Yousefi, The role of small industries in the industrial development of Iran, a collection of articles of the seminar on the role and position of small industrial units in the economic and social development of the country, Tehran, Ministry of Heavy Industries, 1983.
Volume 14, Issue 8
August 2023
Pages 33-43
  • Receive Date: 13 August 2022
  • Revise Date: 21 September 2022
  • Accept Date: 02 October 2022
  • First Publish Date: 22 October 2022