Browse > Article

Effect of SMEs' Business Environment Perception, Corporate Competency, and Managerial Competency on Intention to Discontinue Business of CEOs: Mediating Effect of Business Confidence  

Yoon, Deok Sang (Hoseo University Graduate School of Venture)
Ha, Kyu So (Hoseo University Graduate School of Venture)
Publication Information
Asia-Pacific Journal of Business Venturing and Entrepreneurship / v.17, no.3, 2022 , pp. 103-117 More about this Journal
Abstract
The recent corporate economy, such as the COVID 19 pandemic that has spread all over the world since the beginning of 2020, the acceleration of the 4th industrial revolution, and supply chain management risks triggered by the US-China conflict and the Ukraine crisis, is more serious than ever before. CEOs who have started and managed small and medium-sized enterprises (SMEs) are more concerned than ever about the sustainability of their businesses in this reality. Nevertheless, there were few empirical studies on the factors that influence the intention of SME CEOs to discontinue business. In this study, the perception of the business environment of SMEs (intensity of competition in key business areas, difficulty in manpower management), corporate competency (employee competency, company product or service competitiveness, supply chain and consumer relations, digital competency and technical expertise), and CEO's competency(trust between employees and the CEO, management competency and perceived health status of CEO) on CEO's intention to discontinue business was discussed. As a result of the study, the intensity of competition in the main business field, and the difficulty in manpower management had a positive (+) effect on the intention to discontinue the business, and the employee competency, product (service) competitiveness, digital competency of the company, and the CEO's Health status had a negative (-) effect on intention to discontinue business. The relationship between these influences was found in the order of CEO's health status, product competitiveness, employee competency, digital competency, competitive strength in the main business, and difficulty in manpower management. It was analyzed that supply chain and consumer relations, trust between employees and the CEO, and management capabilities did not significantly affect the intention to discontinue business. On the other hand, business confidence has a mediating effect between the intensity of competition in the main business field, the difficulty in manpower management, product or service competitiveness, digital competency, trust between employees and the CEO, and the management capability and intention to discontinue business was tested. This study had academic significance in that it empirically analyzed factors related to intention to discontinue business targeting small and medium-sized business CEOs. In practice, as it has been found that business environment awareness, corporate competency, managerial competency, and business confidence are factors that influence the intention to discontinue business, if an action ideas that can reinforce this part can be found, SMEs can achieve sustainable growth or it may help CEO find an meaningful exit.
Keywords
Business environment awareness; corporate competency; managerial competency; business confidence; intention to discontinue business; small and medium-sized enterprises (SMEs);
Citations & Related Records
Times Cited By KSCI : 1  (Citation Analysis)
연도 인용수 순위
1 Ha, D. H.(2017). The influence of corporate ability and corporate social responsibility on customer satisfaction and repurchase intention in the airline company. International Journal of Tourism Management and Sciences, 32(8), 47-71.   DOI
2 Chrisman, J. J., Fang, H., Kotlar, J., & Massis, A. D.(2015). A note on family influence and the adoption of discontinuous technologies in family firms. Journal of Product Innovation Management, 32(3), 384-388.   DOI
3 DeTienne, D.(2010). Entrepreneurial exit as a critical component of the entrepreneurial process: Theoretical development. Journal of Business Venturing, 25(2), 203-215.   DOI
4 Estay, C., Durrieu, F., & Akhter, M.(2013). Entrepreneurship: From motivation to start-up. Journal of International Entrepreneurship, 11(3), 243-267.   DOI
5 Hsu, D. K., Wiklund, J., Anderson, S. E., & Coffey, B. S.(2016). Entrepreneurial exit intentions and the business-family interface. Journal of Business Venturing, 31(6), 613-627.   DOI
6 Choi, M. K.(2015). The Influence of Women Entrepreneurship on Organization Performances-Mediating Effects of Organizational Culture, and Moderating Effects of Environmental Uncertainty and Competitive Intensity. Doctoral Dissertation, Graduate School of Soongsil University.
7 Coad, A.(2014). Death is a not a success: reflections on business exit. International Small Business Journal, 32(7), 721-732.   DOI
8 Park, C. W.(2017). A Study on the Effect of Superleadership of Small and Medium Enterprises on Business Performances. Asia-Pacific Journal of Business Venturing and Entrepreneurship, 12(4), 175-189.   DOI
9 Buehler, S., Kaiser, C., & Jaeger, F.(2012). The Geographic Determinants of Bankruptcy: Evidence from Switzerland. Small Business Economics, 39(1), 231-251.   DOI
10 Caves, R. E., & Porter, M. E.(1977). From entry barriers to mobility barriers: conjectural decisions and contrived deterrence to new competition. The Quarterly Journal of Economics, 91(2), 241-262.   DOI
11 Margahana, H., & Negara, S. T.(2019). Self-efficacy, self-personality, and self-confidence on entrepreneurial intention: Study on young enterprises. Journal of Entrepreneurship Education, 22(1), 139-157.
12 Martins, I., Monsalve, J. P. P., & Martinez, A. V.(2018). Self-confidence and fear of failure among university students and their relationship with entrepreneurial orientation: Evidence from Colombia. Academia. Revista Latino americana de Administracion, 31(3), 471-485.   DOI
13 Miller, D., & Friesen, P.(1984). A longitudinal study of the corporate life cycle. Management Science, 30(10), 1161-1183.   DOI
14 Han, H. W., & Ha, K. S.(2020). A Study on the Influence of Nascent Entrepreneurs Motivation and Preparation on the Business Continuity: Based on the Mediation Effect of Start-up Satisfaction. Asia-Pacific Journal of Business Venturing and Entrepreneurship, 15(5), 77-98.   DOI
15 Kim, D. Y., & Shin, D. Y.(2021). Macro Factors Affecting Corporate Venture Capital Investments: Effects of Industrial Boom, Exogenous Crisis, Economic Growth, Competition Intensity. Asia-Pacific Journal of Business Venturing and Entrepreneurship, 16(4), 101-113.   DOI
16 Havila, V., & Medlin, C. J.(2012). Ending-competence in business closure. Industrial Marketing Management, 41(3), 413-420.   DOI
17 Cho, Y. R.(2021). The Effect of Perceived Loss of Financial.Market.Social Capital Based on Recurrence Intention of Failed Small Business Entities-Focusing on the Mediating Effect of Fear of Failure and the Moderating of Entrepreneurial Self-Efficacy. Doctoral Dissertation, Graduate School of Soongsil University.
18 Otache, I., Edopkolor, J. E., & Okolie, U. C.(2021). Entrepreneurial self-confidence, perceived desirability and feasibility of hospitality business and entrepreneurial intentions of hospitality management technology students. The International Journal of Management Education, 19(2), 100507.
19 Bain, J. S.(1968). Industrial Organization. New York: John Wiley & Sons.
20 Decker, C., & Mellewigt, T.(2007). Thirty years after Michael E. Porter: What do we know about business exit?. The Academy of Management Perspectives, 21(2), 41-55.   DOI
21 Yoon, S. J., & Seo, J. H.(2021). Analysis of the Factors Influencing the Management Characteristics of Tech SMEs in Determination of High-growth Firms: Focusing on Fourth Industrial Revolution Related Businesses and General SMEs. Asia-Pacific Journal of Business Venturing and Entrepreneurship, 16(6), 157-175.   DOI
22 Soluk, J., Kammerlander, N., & Massis, A. D.(2021). Exogenous shocks and the adaptive capacity of family firms: exploring behavioral changes and digital technologies in the COVID-19 pandemic. R&D Management, 51(4), 364-380.   DOI
23 Woo, J. P.(2022). Concept and Understanding SEM. Seoul: Hannarae.
24 Yang, S. K., & Song, E. G.(2018). A Study on the Influence of CSR and Corporate Ability on Purchase IntentionFocused on The mediating effects of product attitude and the moderating effects of corporate reputation. Management & Information Systems Review, 37(2), 1-21.   DOI
25 DeTienne, D., & Cardon, M. S.(2012). Impact of founder experience on exit intentions. Small Business Economics, 38(4), 351-374.   DOI
26 DeTienne, D., & Wennberg, K.(2016). Studying exit from entrepreneurship: New directions and insights. International Small Business Journal, 34(2), 151-156.   DOI
27 Economc Statistics System(2022). 9.1.1 Business due diligence index. Retrieved 2022.04.27. from https://ecos.bok.or.kr/#/.
28 Endratno, H.(2019). The effect of self-confidence and subjective norm on students' entrepreneurial intention. Advances in Social Science, Education and Humanities research, 231(5), 348-350.
29 DeTienne, D., & Wennberg, K.(2013). Small business exit: Review of past research, theoretical considerations and suggestions for future research. Ratio Working Paper No. 214. Retrieved from http://ratio.se/app/uploads/2014/11/kw_dd_exit_rr1final_218.pdf.
30 Lee, G. M.(2018). Influence of Entrepreneur Characteristics and Startup Preparedness on Business Continuity Focusing on the Mediating Effect of Entrepreneurial Will. Doctoral Dissertation, The Graduate School of Pusan National University.
31 Lindbloma, A., Lindblomb, T., & Wechtler, H.(2020). Dispositional optimism, entrepreneurial success and exit intentions: The mediating effects of life satisfaction. Journal of Business Research, 120, 230-240.   DOI
32 Mason, E.(1939). Price and production policies of large-scale enterprise. American Economic Review, 29(1), 61-74.
33 Shin, D. Y., & Jeong, D. H.(2022). Paradox of hyper-connectivity. Seoul: Cloudninebooks.
34 Perryman, A. A., Butler, F. C., Martin, J. A., & Ferris, G. R.(2010). When the CEO is ill: Keeping quiet or going public?. Business Horizons, 53(1), 21-29.   DOI
35 Porter, M. E.(1985). Competitive Advantage: Creating and Sustaining Superior Performance. New York: Free Press.
36 Raunelli, J. C., Power, M., & Galarza, F.(2016). Why do entrepreneurs leave the market? An explanation from experimental economics in Peru. Economia, 39(77), 187-228.   DOI
37 Ministry of SMEs and Startups Department of Policy and Statistical Analysis(2022). An easy-to-understand explanation of the scope of small and medium-sized enterprises (SMEs). Sejong Special Self-Governing City: Department of Policy and Statistical Analysis.
38 Porter, M. E.(1980). Competitive Strategy. New York: Free Press.
39 Otache, I.(2020). Applying the theory of planned behaviour to hospitality management students in Nigeria: The mediating role of self-confidence. Journal of Enterprising Communities: People and Places in the Global Economy, 15(3), 375-394.   DOI
40 Park, R. K.(2010). Impact of Corporate Characteristics and Corporate Social Responsibility on Brand Attitude and Loyalty. Doctoral Dissertation, Department of Business Administration Graduate School of Chosun University.
41 Yun, G. S., & Park, J. S.(2017). Impact of Entrepreneurial Competence on Business Performance, According to Business Education of Small Business Owners. Korea Logistics Review, 27(3), 67-77.
42 Scherer, F. M.(1980). Industrial Market Structure and Economic Performance. Chicago: Rand McNally & Co.
43 Williams, D. A.(2015). Entrepreneurial Training and Business Discontinuation: A Cross Country Study. Journal of Business and Entrepreneurship, 26(3), 79-102.
44 Yu, R. H.(2017). A Study on the Effect of SME CEO's Competencies on Corporate Performance-Focusing on the Differential Effects in Growth Stages. Doctoral Dissertation, Service Business School Kyonggi University.
45 Kim, J. H.(2018). Impacts of Characteristics and Competencies of Small Business CEOs on Business Performance: Focusing on the Mediating Effect of Network Activities. Doctoral Dissertation, The Graduate School of Venture, Hoseo University.
46 Hwang, J. W., & Park, K. M.(2020). Performance Improvement under Uncertain Environment: Moderating Effects of Competitive Strategy and Scanning Activity. Korean Journal of Business Administration, 33(1), 167-188.
47 Jadmiko, P., Azliyanti, E., & Putri, T. D.(2019). Linking Perceived Educational Support to Entrepreneur Intention: The Mediating Effect of Self-Confidence. Andalas Management Review, 3(1), 1-17.
48 Jeong, U. S.(2021). (A) Study on the Factors Influencing the Future Prospects of Employees of Small and Medium Venture Companies: Focusing on the Moderating Effect of Organizational cultures. Doctoral Dissertation, The Graduate School of Venture, Hoseo University.
49 Kim, H. H.(2016). Study on the effect of business failure on re-startup intention and business performance. Doctoral Dissertation, Graduate School, Soongsil University.
50 Kim, H. J., & Lee, D. I.(2009). Moderating Effect of Customer Traits, Relationship Characteristics and Marketing Competence on Customer Satisfaction-Repurchase Intention -Repurchase Behavior. Journal of Commodity Science and Technology, 27(2), 145-156.
51 Kim, T. H.(2017). Impacts of the Characteristics of Jewelry Industry Executives and Support Project for Small Traders and Enterprisers on Business Performance. Doctoral Dissertation, Graduated School of Kaya University.
52 Kim, K. A.(2013). A Study on Relations among Small Business Persons' Psychological Characteristics, Entrepreneurship, Entrepreneurial Satisfaction, and Entrepreneurial Recommendation Intention: Focusing on Entrepreneurs of Dessert Cafes. Doctoral Dissertation, Graduated School of Kyungsung University.
53 Hayes, A. H.(2022). Introduction to Mediation, Moderation and Conditional Process Analysis: A Regression-Based Approach. New York, NY: The Guilford Press.
54 Headd, B.(2003). Redefining Business Success: Distinguishing Between Closure and Failure. Small Business Economics, 21, 51-61.   DOI
55 Honjo, Y., & Kato, M.(2022). Are founder-CEOs resilient to crises? The impact of founder-CEO succession on new firm survival. International Small Business Journal: Researching Entrepreneurship, 40(2), 205-235.   DOI
56 Bain, J. S.(1956). Barriers to New Competition. Cambridge: Harvard University Press.
57 Barney, J. B., & Hesterly, W. S.(2014). Strategic Management and Competitive Advantage. NJ: Pearson Prentice Hall.
58 Yoo, J. S.(2021). Analysis of the employment impact of the minimum wage increase in 2018 and its implications. Journal of Regulation Studies, 30(1), 9-28.   DOI