The Key Success Factors, Distinctive Capabilities, and Strategic Thrusts of Top SMEs in Singapore

• Main Authors: Ghosh, B. C., TAN, Wee Liang, TAN, Teck Meng, Chan, Ben
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2001
• Subjects: Accounting; Asian Studies; Entrepreneurial and Small Business Operations
• Online Access: https://ink.library.smu.edu.sg/soa_research/132; http://dx.doi.org/10.1016/s0148-2963(99)00047-8
• Institution: Singapore Management University

The research tries to determine the strategy dynamics and key success factors (KSFs) for excellence in performance of the so-called tiger SMEs in Singapore. In 1995 and 1996, 50 top privately owned and successful enterprises in Singapore were identified. They have shown that they can excel, even in the current highly competitive and high operation–cost environment. Their performance can be attributed to their dynamism and a few KSFs that are apparently universal to these successful companies. The strategy dynamics and their specific components (i.e., the six top SMEs) are found to be: 1) A committed, supportive, and strong management team. 2) A strong, visionary, and capable leadership. 3) Adopting the correct strategic approach. 4) Ability to identify and focus on market. 5) Ability to develop and sustain capability. 6) A good customer and client relationship. Approximately 60% of the companies surveyed were found to be of Defender type organizations (Miles and Snow typology). As a majority of the companies are from manufacturing and servicing sectors and from OEMs supporting the MNCs, it is not surprising that the Defender type strategy is predominant. However, such organizations may have to evolve in order to adopt a more superior strategy such as Prospector and Analyzer when environment changes. The importance placed by organizations adopting different strategy types on their strategic posture are different although KSFs and capabilities are generally universal. Comparing proactive with passive strategy types, the degree of emphasis given on various success factors by proactive type companies was generally found to be higher. Specifically, proactive type companies placed higher importance on the following factors for excellent performance: (i) Satisfying customers needs, (ii) Close working relationship between top management and employee, (iii) Regionalization, (iv) Leadership, (v) Availability of financial and technology resources and support. Further, the research also found that the importance attached to the various strategy-related success factors changes with the development. As it becomes more established, the ranking of KSFs changes as the organization faces different challenges when competitions becomes tougher.Enterprises need to pay attention to the following dynamics and strategic thrusts (a) Strong market orientation and relevant capability; (b) Effective management; (1) Strong management commitment and support (2) Strong organizational capability and management cohesiveness; (c) Access to broad base support and resources (i.e., Networking).