Does managerial training increase SME managers' effectiveness? A capability development approach

Abstract

Purpose: Training remains an important factor in developing the managerial effectiveness and capability of small and medium-sized enterprises (SMEs), yet there are concerns regarding the quality of training provided to SME managers in Ghana, hence the weak managerial capabilities observed in SME management. This study, therefore, examines the impact of managerial training on the effectiveness of SME managers in Ghana. Design/methodology/approach: Drawing on the human capital theory (Becker, 1962; Rosen, 1977), this study employs the variance-based estimating technique, partial least square structural equation modelling (PLS-SEM) in estimating the effects of training on the managerial effectiveness of SME managers. Adopting a stratified random sampling technique, the study uses primary data collected from 506 SMEs in Ghana to test 4 hypothesised paths. Findings: First, the model result indicates that training accessibility and training content are statistically significant in explaining managerial effectiveness at a 1% level. However, both training efficiency and training frequency are statistically insignificant in explaining managerial effectiveness in Ghana. Second, while the industry category is found to influence the relationship between training and managerial effectiveness, gender, manager's age and education are insignificant in explaining any effects. Research limitations/implications: Though the sample size is large, the findings from this study could not be generalised to the whole of Ghana since it is regionally based. The study could benefit immensely from a triangulated method where a qualitative dimension could provide deeper insight into some of the findings in this study. Originality/value: Studies of this nature focussing on the managerial effectiveness of SME managers in the Ghanaian context is rare. This is one of the few studies in the Ghanaian research context which focuses on the capability development approach in the delivery of managerial training to SMEs.