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The Impact of Management Practices on SME Performance

Author

Listed:
  • Forth, John

    () (National Institute of Economic and Social Research (NIESR))

  • Bryson, Alex

    () (University College London)

Abstract

We examine the impact of management practices on firm performance among SMEs in Britain over the period 2011-2014, using a unique dataset which links survey data on management practices with firm performance data from the UK's official business register. We find that SMEs are less likely to use formal management practices than larger firms, but that such practices have demonstrable benefits for those who use them, helping firms to grow and increasing their productivity. The returns are most apparent for those SMEs that invest in human resource management practices, such as training and performance-related pay, and those that set formal performance targets.

Suggested Citation

  • Forth, John & Bryson, Alex, 2018. "The Impact of Management Practices on SME Performance," IZA Discussion Papers 11399, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp11399
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    References listed on IDEAS

    as
    1. Nicholas Bloom & Renata Lemos & Raffaella Sadun & John Van Reenen, 2015. "Does Management Matter in schools?," Economic Journal, Royal Economic Society, vol. 0(584), pages 647-674, May.
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    5. Nicholas Bloom & Christos Genakos & Raffaella Sadun & John Van Reenen, 2011. "Management Practices Across Firms and Countries," CEP Discussion Papers dp1109, Centre for Economic Performance, LSE.
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    More about this item

    Keywords

    SMEs; small and medium-sized enterprises; employment growth; high-growth firms; productivity; workplace closure; management practices; HRM; recession;

    JEL classification:

    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
    • M53 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Training

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