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Strategic capabilities and firm performance in Omani manufacturing and service SMEs

Khaldoon Nusair (Department of Marketing, Sultan Qaboos University, Muscat, Oman)
Hamed Ibrahim Al-Azri (Sultan Qaboos University, Muscat, Oman)
Usamah F. Alfarhan (Department of Economics and Finance, Sultan Qaboos University, Muscat, Oman)
Saeed Al-Muharrami (Department of Finance, Sultan Qaboos University, Muscat, Oman)
S.R. Nikhashemi (Department of Marketing, Sultan Qaboos University, Muscat, Oman)

Journal of Entrepreneurship in Emerging Economies

ISSN: 2053-4604

Article publication date: 31 July 2021

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Abstract

Purpose

This paper aims to examine small- and medium-sized enterprises’ (SMEs) strategic capabilities in terms of their marketing and management capabilities, their sources of environmental uncertainty and their organizational capabilities. Additionally, to what extent the effect differs across two sectors (manufacturing and service).

Design/methodology/approach

Partial least squares structural equation modeling was used to conduct multigroup analysis for the two sectors. Data was collected from a sample of 315 Omani SMEs, 166 from manufacturing and 149 from services.

Findings

The results show that strategic capabilities have a significant positive effect on customer satisfaction. However, the effect differs between manufacturing and service SMEs; the effect is greater in service than in manufacturing SMEs. Furthermore, the effect of organizational capabilities on customer satisfaction was found to be positive. However, the effect is higher in manufacturing as the difference is statistically significant.

Originality/value

Due to the growing importance of the service and manufacturing SMEs in developing countries and their considerable involvement in economic development, it is important to understand the characteristics of the strategic capabilities in both sectors. Thus, according to the authors’ knowledge, this paper is one of the first to propose a comprehensive framework that measures collectively the direct impact of strategic capabilities, organizational capabilities and environmental uncertainties on SMEs customer satisfaction and effectiveness.

Keywords

Acknowledgements

Funding: The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: His Majesty’s Trust Fund; SR/EPS/MRKT/16/01.

Citation

Nusair, K., Al-Azri, H.I., Alfarhan, U.F., Al-Muharrami, S. and Nikhashemi, S.R. (2021), "Strategic capabilities and firm performance in Omani manufacturing and service SMEs", Journal of Entrepreneurship in Emerging Economies, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JEEE-12-2020-0460

Publisher

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Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

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