The impact of motivations, personal values and management skills on the performance of SMEs in South Africa

The purpose of this paper is to empirically investigate the impact of motivation, personal values and managerial skills of managers on the performance of small and medium enterprises (SMEs) in South Africa.

Data were collected through the use of self-administered questionnaire in a survey. Data analysis included factor analysis, descriptive statistics, Pearson correlation and regression analysis.

The findings revealed significant positive relationships between motivations, personal values and managerial skills of SME owners on performance.

Access to external finance (debt or equity) is one of the factors that can impact on the performance of growing SMEs. The non-accessibility of debt finance from commercial banks and trade creditors is seen as one of the major contributing factors to the failure of SMEs in South Africa. This study did not link access to finance to performance.

The failure rate of SMEs is very high in South Africa. The study suggests that SME owners should incorporate values and improve management skills. In addition, SMEs that are motivated by opportunity have a better chance of survival.

To reduce unemployment and poverty in South Africa.

This study adds to the understanding of the relationship between of personal values, motivations and management skills of managers and the performance of SMEs from a developing country perspective.