Effects of Entrepreneurial Competencies and Business Networks on Business Success of Small Size Contractors in Malaysia

• Main Authors: Nazaruddin, Ishak, Juhary, Ali
• Format: Journal
• Published: 2015
• Subjects: HD Industries. Land use. Labor
• Online Access: http://ur.aeu.edu.my/36/
• Institution: Asia e University

The construction industry plays an important role in economic growth and in long-term national development. The industry acts as a catalyst to stimulate the growth of economy in generating wealth and development of social and economic infrastructures and buildings. The Census 2011 issued by the Department of Statistics Malaysia on 18 September 2012 recorded 645,136 Small and medium contractors operating their businesses in Malaysia which representing 97.3% of total business establishments. Small size contractors that are categorized as G1 to G3 continue to be the backbone of the Malaysian construction industry that represented 87.1% of the total establishments in that sector. One of the key issues facing the construction industry in Malaysia is to ensure that the industry can attain and able to sustain the anticipated growth. However, previous studies on SMEs in other sectors indicated the causes for SMEs failure are numerous, including lacks of business skills and competencies, business network and financial. It is found that no empirical study had focused on small size contractors in the construction industry in Malaysia Against this background, this study attempts to empirically examine and evaluate the significance of the entrepreneurial competencies and entrepreneurial networks on the success of small size contractors in Malaysia. Entrepreneurial competencies are defined as the total ability of the entrepreneur to perform a job role successfully. On the same note, for the purpose of starting and continuing a business, entrepreneurs further need to obtain most resources from outside or his/her external environment through the entrepreneur’s networks. The study was conducted among 368 small size contractors (category G1-G3) in 2014. Using the quantitative method of analysis, the study revealed that the entrepreneurial competencies like personal. ethical, technical, management, learning and opportunity competencies and the entrepreneurial networks including social, entrepreneurial and inter-organizational network are positively and significantly effecting the business success of small size contractors.