Strategic management in construction firms with focus on small and medium enterprises : a case study eThekwini, South Africa

Abstract

Small and Medium Enterprises (SMEs) play a vital role in the economy and have contributed significantly to the growth of the economy, however, there is still a high-level failure rate. Many face a threat of failure within the first few months of establishment and the lack of strategic planning may prevent them from achieving their full potential. Therefore, the aim of this study is to address the factors that influence the adoption of strategic management in an organization and to identify persuading factors that contribute to strategic management to improve performance and to categorise challenges faced by SMEs in implementing a strategic plan. The results advocate that majority of the eThekwinibased SMEs in the construction industry are applying strategic management practices in their business and through this application they have improved the performance of their business. Furthermore, the study found that there were high levels of agreement with the challenges facing the implementation of a strategic plan in an organization. The research concluded that that majority of the eThekwini-based SMEs in the construction industry are applying strategic management practices in their business and through this application they have improved the performance of their business. The study also concluded that there were high levels of agreement with the influencing factors that drove SMEs to adopt a strategic plan and high levels of agreement with the contributing factors of strategic planning in improving performance of the business. Furthermore, the study found that there were high levels of agreement with the challenges facing the implementation of a strategic plan in an organisation.