Resource-Based View and Critical Success Factors: A Study on Small and Medium Sized Contracting Enterprises (SMCEs) in Malaysia

Abstract

This article reviews the resource-based view theory and factors relating to the performance of small and medium sized contracting enterprises (SMCEs) in Malaysia. The strength of this theory lies in its ability to explain the usefulness of the firm’s resources to its performance. By using multiple regression, this study proposes empirically that SMCEs should place greater emphasis on managerial capabilities in finance, project, and marketing and supplier relationships in order to enhance company performance. However, unique to this industry, the research found that owner/manager characteristics are not significant factors in explaining firm performance. The findings of the research provide evidence that the survival of the firm relies greatly on its main resources, i.e. effective and efficient managerial capabilities, to formulate strategies in order to achieve sustainable competitive advantage in the industry.

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