The Impact Of Strategic Capabilities On Small Business Growth In Liberia

Small businesses have been recognized around the world as a critical force in creating a strong,stable economy and society.It also can be known as Entrepreneurship which is an important component of economic development.Small businesses are a primary source of new job and they are job creators and consistently create the majority of net new jobs.The performances of small business in Liberia looks promising,growth rate is still low.And while around the world the muchpublicized,high-growth “start-up” enterprises may be,often deservedly,claim headlines for creating jobs,Small Business Administration in Liberia reports that about 60% of the private sector?s net new jobs were created by existing establishments,with the remaining 40% attributed to start-up companies.Small businesses vary widely in size and capacity for growth.They are characterized by independence of action,differing organizational structures,and varied management styles.This study is significant because the growth rate of small business in Monrovia,Liberia should be stepped up and the measurements of these small business performance enhancement factors as well as competencies and capabilities should be accessible within the rapid and aggressive business atmosphere.The implementation of these strategic capabilities will be beneficial for growth of these small businesses.This study purposely assessed the influence of small business capabilities on their growth.This Research weighs four strategic capabilities of small businesses: Technological Capabilities,Marketing capabilities,Networking Capabilities and Information technology Capabilities on small business growth in Liberia.The main objective of this study is to investigate the core small businesses capabilities on their growth in Liberia.In the second part of this study,we investigate the extent to which market turbulence moderates the relationship between Small Business Growth and the four capabilities stated in Liberia.[12] This study answers these four research questions: Does technological capabilities affect small business growth in Liberia? Can marketing capabilities influence small business growth in Liberia? What role does networking capabilities have on the growth of small businesses in Liberia? And what impact does information technology have on small business growth in Liberia?The dependent variable in this research is small business growth and the research independent variables are technological capabilities,marketing capabilities,network capabilities,information technology capabilities.We proposed and test 8 hypotheses and from these hypotheses,we concluded that there is a positive relationship between technological capability and small business growth in Liberia but only to some extent beyond which there seems to be undefined relationship.Market turbulence moderates the relationship between technological capability and small business growth with regard to new product development and improvement in production facilities at a high level of market turbulence.There is a strong positive relationship between marketing capabilities and small business growth in Liberia.In times of stable market environment,small businesses in Liberia use their marketing capabilities to know their customers,how to segment and maneuver in their target markets and for formulating effective marketing programs.However,they care less about competition when the market environment is stable and do little to use their marketing capabilities to know their competitors and this affects them negatively.Networking capabilities have a positive relationship with small businesses? growth in Liberia through creation of durable relationships with customers and maintaining ability to retain customers.Networking capabilities allow small businesses to develop their market-sensing capability.Small businesses in Liberia do not exploit their networking capability to create durable relationships with suppliers,and this affects their growth negatively.However,under conditions of market turbulence,the small businesses in Liberia also begin to exploit their networking capability to create durable relationships with suppliers.In a relatively stable market environment,the small businesses in Liberia are able to use IT capabilities positively in new product development projects and sometimes(weakly)for internal communication in their businesses.They neither use IT capabilities for cross-functional integration nor for facilitating market knowledge creation,situations which affect their growth negatively.This research recommended that small businesses in Monrovia,Liberia should improve their new products development projects designs and production facilities in technological capability,explore their networking capability by creating a durable relationship with their suppliers under stable and unstable market environment,use their information technology capability for cross-functional integration and use information technology capability to understand and generate market knowledge.