Effects Of Lack Of Management In SME

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2.4.3. Lack of management and Business experience
Management of SMEs is an acknowledged challenge that has proved difficult to overcome (OECD, 2000). SME owners are often managers of their enterprises and usually have no formal qualifications in management and leadership (De Kok, Uhlaner, & Thurik, 2006). Pansiri and Temtime (2008) observed that although most of them understand the concepts of their business goals and objectives, they may not necessarily make good managers. The management approach adopted by owners depends on the goals and personal expectations of these individuals (Collins & Clark, 2003). In most cases, SME owners do not foresee growth beyond a certain level. They aim to achieve their personal objectives with no effort put toward expansion …show more content…

Those SMEs which have more capable workers are likely to be more efficient (Hewitt and Wield, 1992; Lucas, 1993). Several studies recognized low human resource capabilities as major constraint in SMEs development in developing countries (Batra and Tan, 2003; Lee 2001; McElwee and Warren, 2000). Human resources in SME generally are weak in terms of their knowledge and skills of market analysis, marketing and product innovation as well as business planning and financial management. Therefore, the need is to develop capacity building programs to improve the entrepreneurial and business management skills of human resources in SMEs and enhance the effectiveness of SMEs. Entrepreneurial competencies may, therefore, be developed by training and education (Gibb, 1986; Romjin, 1989). Firms with a literate and well-educated workforce are thus likely to be more efficient because of their greater capability to absorb and effectively utilize new technology (Hewitt and Wield 1992; Lucas 1993). The creation and development of SMEs in Bujumbura, Burundi, will be affected with personal within

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