Implementation of Performance Management Systems in Small Medium and Micro Enterprises

Abstract

Purpose: Small Medium and Micro Enterprises (SMMEs) often struggle with performance measurement which can result in a high failure rate. This study aimed to examine the role of owner-managers in understanding performance management, the implementation processes of Performance Management System (PMS), and what challenges associated with applying PMS within SMMEs they faced. SMMEs will greatly benefit from a reliable PMS that can streamline day-to-day operations and facilitate effective decision-making through Key Performance Indicators (KPIs). Design/Methodology/Approach: A qualitative approach was applied for the research methodology to understand the perspectives of owner-managers within SMMEs. The study employed a purposive, non-purposeful sampling technique to select twelve (12) participants. Semi-structured, face-to-face interviews were conducted with the participants’ consent to collect data. Findings: The collected data was subsequently analyzed using content analysis to scrutinize and interpret the findings. The research findings of this study found that owner-managers hold a general understanding of PMSs. Implications/Originality/Value: The implementation of PMSs in SMMEs presents a significant challenge, particularly in identifying pertinent KPIs.

Keywords

• Performance management systems
• Performance measurement system
• Key performance indicators
• Small Medium and Micro Enterprises
• Motor retail industry