Review

International Journal of Engineering

Business Management

Volume 16: 1–21

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DOI: 10.1177/18479790241258097

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Inﬂuential factors of small and medium-sized

enterprises growth across developed and

developing countries: A systematic

literature review

Dian Fajarika

1,2

, Fitri Trapsilawati



and Bertha Maya Sopha

Abstract

Small and medium-sized enterprises (SMEs) are contributors to economic growth. Many studies have mentioned a broad

range of factors that inﬂuence the development of SMEs. However, studies examining SME growth between developed and

developing countries have not been comprehensively investigated. The growth of SMEs relies on the entrepreneurial skills

of the entrepreneur, who has the ability to manage business effectively, achieve proﬁt, identify market opportunities, and

enhance innovation by optimizing all available resources. The objective of this article was to synthesize the factors that

inﬂuence the growth of small and medium-sized enterprises (SMEs) across developed and developing countries. This study

particularly synthesized interrelationship factors depicted in a framework addressing resources and capabilities for SME

growth. A systematic literature review (SLR) was employed to examine the research activities on this topic, referring to

108 articles from the Scopus and Web of Sciences databases. The articles synthesized individual studies to analyze the trend

of SME growth research in devel oped and developing countries. Next, the factors of SME growth were identiﬁed into 6 (six)

categories, including human capital resources, entrepreneurial perspectives on marketing, innovation, SMEs partnership,

technology, and entrepreneur personality. The result represents that the factor extensively studied concerning SME

growth is innovation capability, both in developed and developing countries. Differences exist in both critical factors and

interrelationships among factors in developed and developing countries, particularly in the innovation capability, SME

partnership and marketing capabilities.

Keywords

Small and medium-sized enterprises growth, factors, developed and developing countries, systematic literature review,

innovation

Date received: 30 October 2024; accepted: 2 April 2024

Introduction

Small and medium-sized enterprises (SME) growth is often

perceived as an effort to increase economic growth in a

country. SMEs contribute to the gross domestic product

(GDP), value added, and employment absorption both in

developed and developing countries. Due to characteristics

differences between developed and developing countries,

the challenges, the complexity, and hence the solutions

vary.

In developed nations, SMEs contribute to the

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Industrial Engineering Program, Department of Mechanical and Industrial

Engineering, Universitas Gadjah Mada, Yogyakarta, Indonesia

Department of Industrial Engineering, Institut Teknologi Sumatera,

Lampung, Indonesia

Corresponding author:

Fitri Trapsilawati, Department of Mechanical and Industrial Engineering,

Universitas Gadjah Mada, Jl. Graﬁka No.2, D. 1. Yogyakarta 55281,

Indonesia.

Email: ﬁtri.trapsilawati@ugm.ac.id

economy,

export and trade,

and supply chain integration.

Economically, SMEs contribute to value-added and em-

ployment by 40-88% and 35-71% with the average of

51.8% and 67%, respectively.

The existence of SMEs

boosts the international market entry by export and trade.

SMEs have also contributed to the production processes of

large companies by supporting the connection of suppl y of

goods and servi ces that is crucial for the overall functioning

of the economy in developed countries.

In developing countries, SMEs contribute to economic

growth, job creation, poverty alleviation, and inclusive

growth in local areas.

In the economic sector, SMEs

contribute to the increase in gross domestic product (GDP)

and employment by 20-60% and 38-77% with the average

of 36% and 64%, respectively.

The growth performance of

SMEs in developing countries serves as tools for providing

opportunities to produce income for individuals and com-

munities, especially in rural areas.

The SMEs also con-

tribute to inclusive growth, promoting equality among

various entrepreneurs, including women and minority

groups, in economic activities.

Based on the statistical data, it is known that the con-

tribution of SMEs to the economy in developing countries is

lower compared to developed ones. The condition of SMEs

facing low potential growth and failing to achieve sus-

tainable growth is intriguing for study. The contribut ion of

SMEs in the economic sector encourages many countries to

actively promote SMEs to improve the private economic

sector in both developed an d developing countries.

Therefore, there is a need for studies that can provide in-

sights into the factors driving the growth of SMEs and

particularly on the interrelationship between factors in both

developed and developing countries. The interrelationship

among factors aims to help assist in designing strategies for

the development of SMEs. The research on the small and

medium-sized enterprises (SMEs) growth remains a subject

of interest for researchers in both developing and developed

countries. Previous studies, which have involved systematic

literature reviews (SLR) on SME grow th, have focused on

analyzing various factors inﬂuencing SME growth. How-

ever, there is a gap in the existing research concerning

perspectives, the scope of the study, and the interrelation-

ships among factors. Previous research has primarily

concentrated on speciﬁc perspectives, such as the innova-

tion perspective,

technology adoption,

13–16

entrepreneur

personality traits,

and marketing capabilities.

17–19

SME

growth is a multifaceted issue that cannot be accurately

understood from a single perspectives.

Another aspect that has been overlooked pertains to the

level of research scope. This study’s coverage is related to

the level of inﬂuence in both developing and developed

countries. In developed countries, the earlier literature re-

views have primarily examined the organizational level

with factors related to organizational learning,

business

innovation,

21,22

and human resources.

Conversely, some

literature reviews have addressed factors for SMEs growth

factors in organization level and individual level, such as

technology adoption,

24–26

and entrepreneur personality.

7,27

Research on SMEs between developed and developing

countries has predominantly focused on organizational

aspects, utilizing single-country samples in both developed

and developing nations. This approach may lack of rep-

resent the overall conditions of both types of countries.

Importantly, these studies have not comprehensively ad-

dressed the interrelationships among factors inﬂuencing

SME growth. Therefore, a literature review study is nec-

essary to collect and identify the factors inﬂuencing SME

growth examined in both developed and developing

countries in order to obtain a more comprehensive studies

by exploring the interrelationship between these factors.

Research question

Based on previous literature reviews, it is evident that studies

on the growth of SMEs have not addressed interrelationship

among factors underlying the growth. Research related to

SMEs does not examine the interrelationship factors of SMEs

between in developing and developed countries. The com-

parison between these countries is necessary for formulating

strategies to facilitate accelerated growth in developing

countries. The objectives of this article are (i) to identify critical

factors that inﬂuence SMEs’ growth in developed and de-

veloping countries and (ii) to develop a framework on the

interrelationship between factor in developed and developing

countries to measure SMEs’ growth.

The article consists of ﬁve sections. The ﬁrst section

describes the method to conduct the systematic literature

review. The second section discusses the paper analys is,

which shows the trend of publications related SMEs growth.

The paper analysis identiﬁes the year of publication, the

countries as the research location, and the methods that

contributed to SME g rowth research. Following that, this

article explains the synthesis of factors that inﬂuence SME

growth. The factors are synthesized using inclusion criteria.

The fourth section involves a systematic analysis that show s

the relationship between facto rs in previous studies. The

ﬁnal section explains the SMEs growth framework that is

taken from synthesizing the relationship between factors

from developing and developed countries.

Methods

To address this research question, we use a systematic

literature review approach. The systematic literature revie w

is used to ident ify, select, and analyze relevant data from the

studies that are included in the review.

The study iden-

tiﬁed the factors used in the SME growth model from in-

dexed journals. The systematic literature review (SLR)

2 International Journal of Engineering Business Management

followed the Preferred Reporting Items for Systemic Re-

views and Meta-Analysis (PRISMA) method.

The SLR

began by searching journals in electronic databases, fol-

lowed by identifying, screening, assessing for eligibility,

and synthesizing them (Figure 1).

Stage 1: Identify the publication

In this literature study, the process began with ident ifying

the publication. The publication was searched by deter-

mining research objectives. The search utilized databases

such as Scopus and Web of Science. The publication search

did not limit the year of publication. The keywords used to

search the journal wer e “SMEs AND Growth AND

Modelling” or “SMEs growth AND Factor”, “SMEs AND

growth AND Entrepreneurship”. From electroni cs data-

bases, it was found that 1274 journal articles were obtained

through Scopus, and 10 were derived from Web of Science

by using the keywords “SMEs AND Growth AND Mod-

elling” or “SMEs growth AND Factor ” . In addition, we

obtained 63 journal articles from Scopus using the key-

words “SMEs growth and entrepreneurship”. Therefore, the

total of journal articles obtained in this study was 1347.

Stage 2: Screening articles

The next step was screening the types of articles. To start

with, the articles were removed from the list of journals,

such as notes, book chapters, proceedings, and duplicated

articles. This screening obtained 916 articles and removed

431 articles. The screening was conducted by reading the

titles and abstracts following the research objectives. By

reading the title and abstract, the search resulted from

354 articles.

Stage 3: Eligibility assessment

Following that, the authors reviewed and analyzed the ar-

ticles that focused on SMEs’ growth factors, research

output, methods, and relationships between SMEs’ growth

factors. We analyz ed whether articles discussed SME

growth from an entrepreneurial perspective. The screening

was continued by assessing eligibility using inclusion cri-

teria. We obtained 108 eligible articles that matched the

inclusion of the literature study (Table 1).

Stage 4: Data analysis and qualitative synthesis

The last stage was data analys is and synthesis. In this stage,

articles were reviewed and categorized into SMEs’ growth

factors, resear ch outputs, research methods, and hypotheses

that stated the relationship between variables. The sys-

tematic literature review used limitations on the scope and

internal factors such as resources and capabilities that

inﬂuenced the growth of SMEs.

Figure 1. Step-by-step systematic literature review.

Fajarika et al. 3

The data analysis was used to obtain proﬁles of the paper,

such as the number of studies per year, the countries of the

research locations, and the number of research outputs.

Qualitative synthesis was used to get an overview of the

interrelationships between factors from previous studies.

The results of the analysis were used to build an SME

growth framework based on previous research.

Eligible articles were read, analyzed, and checked for

consistency. The articles were then categorized based on the

country where the research was conducted. In research

conducted in multiple countries, the country category was

chosen according to the country where the research was

conducted. The category of countries consisted of the ac-

cumulation of countries classiﬁed as developed and de-

veloping countries. Research on small business growth

began in 1998 when the growth of SME s was inﬂuenced by

technology users.

The growth regarding internal SME

factors studies began to change from 2000 onwards, such as

learning orientation.

The research topics discussing en-

trepreneur’s factors were begun in 2008, such as innova-

tiveness and creativity,

and human capital (e.g.

knowledge).

33,34

The research output of these articles was

organized into factor analysis, model, framework, and

simulation.

Result

Description of the literature

Figure 2 shows the trend of research on SMEs’ growth. The

literature was searched without year limitation. Thus, we

obtained literature that observed the SME growth model in

1998. Over 25 years, research trends in the ﬁeld of SME

growth have increased. The upward trend in SME growth

research occurred from 2008 to 2022. The highest amount

of research occurred in 2022. Figure 3 shows countries that

contributed to the SME growth literature. We categorized

the countries into developed and developing countries.

Figure 3(a) illustrates contributing SME growth literature

for developed countries, including Spain (6), Taiwan (6),

Finland (5), Saudi Arabia (4), United Kingdom (4), and

Slovenia (4). Meanwhile, Figure 3(b) shows developing

countries contributing to SME growth studies, such as

Malaysia (7), Indonesia (6), India (5), Iran (4), South Africa

(3), and Ghana (3). The total number of articles in developed

and developing countries is 56 and 52, respectively.

The research output was divided into two including

critical factor and interrelationship between factor. The

critical factor used several methods such as descriptive

statistics analysis,

content analysis,

37,38

thematic analysis,

grounded theory,

and statistical inferences. The descrip-

tive statistics are used to provide a summary of secondary

data to assist in analyzing current performance.

The

critical factors also use qualitative methods such as content

analysis, thematic analysis, and grounded theory. The

content analysis is used to analyze and interpret the conten t

of various forms of communication, such as written, verbal,

or visual material with sample in SMEs to identify speciﬁc

patterns, themes, or characteristics within the collected

data.

Thematic analysis is used to recognize, examine and

report the pattern or themes within dataset entrepreneur by

generating code.

The statistical inferences use the cor-

relation test to examine an association between two vari-

ables. The statistical inferences that used in previous

literature such as Chi-square test,

19,41,42

Pearson Correla-

tion,

Cramer’s V test,

and analysis of variance

(ANOVA).

44,45

This method is utilized to identify factors

inﬂuencing SME growth, such as innovation

capabilities,

33,42,46

marketing capabilities,

and entrepre-

neur personality.

the statistical inferences has limitations,

including its application within a speciﬁc scope and the

potential for misleading results due to the assumption that

observations are independent during variable testing

Figure 4.

The interrelationship factor utilizes a model approach

divided into including theoretical models, structural equa-

tion model, empirical models, and simulation model. The

interrelationship factor used theoretical model to generate

framework discussing entrepreneurial activity is used as a

benchmark for the growth of SMEs. The theoretical model

investigated the model from literature study and synthesized

the critical factor into framework. The previous study ex-

amined causal loop diagram that is explained individual

participation in business operations, participation in market

development, and the ability to increase SMEs’ income.

The framework for the SME’s growth was based on the

owner’s innovations, the ability to sense market needs, the

awareness of the owner in increasing ﬁrm sales, and the total

Table 1. The inclusion criteria of the literature review.

Inclusion criteria

The articles originated multidisciplinary, such as engineering, business and management, and applied science

The articles must follow the theme, namely the SME growth

The articles must review theoretical and empirical studies and such as observation, case study, and experiment

The article discussed factors and models for developing SMEs that refer to entrepreneurs’ involvement

4 International Journal of Engineering Business Management

commitment and involvement in the allocation of limited

resources.

The empirical model in the study of SMEs growth

discusses a growth model using regression analysis ap-

proach. In previous articles, regression model was used to

investigate SME growth employing techniques such as

linear regression,

multiple linear regression,

50–54

logistic

regression,

logit distribution regression,

and combining

multi-regression analysis with fuzzy analysis.

Regression

models are more commonly utilized in developed countries

compared to developing co untries. This approach is used to

understand the extent of the relationship between variables,

such as innovation capability, and SME growth.

51,54

However, the regression approach has a limitation, as it

assumes that factors have a linear relationship and cannot be

used for prediction with co mplex and non-linear variables.

Structural models are descriptive models of a system

developed by utilize established causal and logical rela-

tionships that occur in the system.

This model consists of

structural equation modeling and system dynamic model.

Structural equation modeling (SEM) is used to validate the

conceptual framework. This approach uses two analytical

techniques consisting of conﬁrmatory analysis and ex-

ploratory analysis. The SEM method in the analysis of SME

Figure 2. Publication trend of SMEs growth in entrepreneurship perspective.

Figure 3. SME growth literature by country: (a) developed country, (b) developing country.

Fajarika et al. 5

growth provides signiﬁcant results, with each being asso-

ciated with the innovation capability variable,

12,59–61

marketing capability,

17,62,63

technology capability,

64–66

human capital resources

dan partnership.

This study

also reported SEM Software that was widely used by re-

searchers, such as Smart PLS,

22,26,61,65,68,69

Analysis of

Moment Structures (AMOS), STATA, and EQS 6.1.

The simulation approach provides feedback relation-

ships for variables that may not be explained in other

method such as the structural equation modeling method.

Simulation models related to SME growth using system

dynamics are still relatively underdeveloped in both de-

veloping and developed countries. The simulation utilized

to model growth is system dynamics. The system dynamics

are model approach used to obtain long-term predictions of

SME growth simulation model. System dynamics simula-

tion incorporates growth factors such as physical

resources,

32,70

SME partnerships,

and innovation capa-

bilities.

Simulation models have the advantage of de-

picting real-world conditions with several variables

assumed to behave homogeneously.

Each method used has strengths and weaknesses. The

most straightforward approach is descriptive statistics. This

method is employed to provide a summary of secondary

data to assist in analyzing current performance. In devel-

oped countries, descriptive statistics are used to track the

progress of SMEs through data on management improve-

ments related to education for enhancing SME innovation.

Additionally, it is used to understand the development of

knowledge and innovation in SME products.

In devel-

oping countries, research using descriptive statistics is

applied to analyze the growth of the number of female

entrepreneurs and barriers to SME growth.

However, a

limitation of this method, especially with the use of sec-

ondary data, is its ability only to depict current conditions. It

falls short in offering predictive insights into growth and the

underlying factors behind indicator performance, poten-

tially leading to misint erpretation.

Factors inﬂuencing SMEs growth model

The study investigated the internal factors that inﬂuenced

the growth of SMEs. SME growth, in various terms, uses the

same indicators from SMEs development and performance.

The literature review analyzed the difference in SME

growth factors between developed and developing countries

(Table 2). The number of SME growth literature in de-

veloped countries was 52 articles. Meanwhile, the numbe r

of articles in developing countries was about 56. The factors

can be used to know the SME’s competencies to grow

up. The factors were synthesized into tangible and intan-

gible factors.

146

The tangible factors were synthesized

based on the entrepreneurial perception into several cate-

gories. This factor category was based on perspective ac-

cording to business performance orientation.

The SME

growth factors were catego rized as perspective in market-

ing, innovation, technology, partnership, entrepreneur

personality, and human capital resources.

Theme 1: Human capital resources perspective

The human capital resources is related to the characteristics

of entrepreneurs that serve as capital for the ﬁrm to gain

development opportunities.

126

The growth of SMEs is

supported by human resources as well as the availability of

successors.

The successors are inﬂuenced by the leader’s

willingness to delegate their power to successors.

Fol-

lowing the literature review, the developed countries were

more concerned with human capital resources such as

successor availability than developing countries.

40,74,75

The

availability of successors encourages the continuation of

SMEs’ innovation. The SMEs’ performance was supported

Figure 4. The research output SMEs growth literature.

6 International Journal of Engineering Business Management

Table 2. SMEs growth factors in developed and developing countries.

SMEs growth factors

Sources

Developed Developing

Human capital resources perspective

Successor availability

40,74,75

[N =3] NA

Level of education

34,49,56,76,77

[N =5]

11,78

[N =2]

Gender

[N =1]

Experience

34,79–82

[N =5]

78,83,84

[N =3]

Age of owner

38,56,75

[N =3]

[N =1]

Expertise

85,86

[N =2]

83,84

[N =2]

Marketing perspective

Marketing capability

17,18,31,87,88

[N =5]

19,24,41,89,90

[N =5]

Product brand creation

[N =1]

89,91

[N =2]

Market sensing in consumer needs

22,68,88

[N =3]

9,42,63,89,92

[N =5]

Resistance to branding

67,93

[N =1] NA

Aggressiveness NA

[N =1]

Innovation perspective

Innovation capability

31,59,95

[N =3]

42,60,96

[N =2]

Willingness to innovate

75,97,98

[N =3]

[N =1]

Risk-taking

50,56,76,97,100–102

[N =7]

33,42,92,94

[N =4]

Proactiveness

50,68,76,97,100–102

[N =7]

83,92,94

[N =3]

Knowledge

46,47,72

[N =3]

47,65,83,103–105

[N =6]

Creativity

59,72,96

[N =3]

83,106

[N =3]

Intellectual property rights

[N =1]

Innovation culture

22,39,102

[N =3]

103,107

[N =2]

Product innovation orientation

[N =1] NA

Innovativeness

50,59,68,76,101,108,109

[N =7]

33,83,94,105

[N =4]

Resistance to change NA

[N =1]

Technology adoption perspective

Social media adoption

15,17

[N =2] ,

24,61,64,66,110

[N =5]

E-commerce adoption

15,87

[N =2]

25,73,111

[N =3]

IT capability

21,50,85,112,113

[N =5]

9,63,65,112

[N =4]

Big data analytics capability NA

22,62,112,113

[N =4]

Trust NA

15,114

[N =2]

SME partnership perspective

Personal network

44,115

[N =2]

42,73,104

[N =3]

Partnership quality

79,116

[N =2] NA

Coordination capability

[N =1] NA

Collaboration capability

71,117

[N =2] NA

Knowledge sharing

[N =1] NA

Strategic alliances NA

[N =1]

Willingness to collaborate NA

118

[N =1]

Entrepreneur personality perspective

Growth intention

38,49,77,119,120

[N =5]

7,27,89,121

[N =4]

Leadership behavior

38,39,122

[N =3]

33,123

[N =1]

Motivation

18,40,55,81

[N =4]

[N =1]

Personal commitment

76,122

[N =2]

78,84

[N =2]

Open-mindedness

76,108,122

[N =3] NA

Self-conﬁdence

[N =1] NA

Resilience

44,124

[N =1] NA

Perceived risk NA

125

[N =1]

Perceived barrier NA

125

[N =1]

NA: Not Available

Fajarika et al. 7

by the human capital component, such as level of

education,

11,34,49,56,76 – 78

experience, expertise,

83–86

and age

of the owner.

38,56,75,83,84

The results indicated that the

entrepreneur characteristics, such as the age of the owner,

experience, and education level, had a relationship with

SME growth.

11,49,73,76–78,83,84,127

Both developed and de-

veloping countries showed the same factors in the entre-

preneur’s human capital. Research in developed countries

found that education and experience were the most critical

factors for enhancing SME growth. In addition, there is a

deﬁciency in recognizing the importance of successor

availability as a crucial factor for the sustainability of SMEs.

Theme 2: Marketing perspective

The marketing perspective assesses the factor that supports

market performance on an indi vidual and organization level

in marketing capability.

128

This literature review conﬁrmed

that the growth SMEs described the performance in mar-

keting in terms of sales growth, proﬁt, and market

share.

41,46,71,77,87,127

It is supported by entrepreneurial

factors to give the competencies.

In developed countries,

the factors of SMEs growth related to marketin g perspective

discussed marketing capability,

17,18,31,87,88

product brand

creation,

47,89,91

market sensing in customer needs,

22,68,88

and resistance to branding. Differently, the marketing ca-

pabilities in developing countries did not discuss resistance

to branding but discussed aggressiveness. Marketing ca-

pabilities are deﬁned as the processes that a ﬁrm uses to

deﬁne, develop, communicate, and deliver value to its target

customers by combining, transforming, and deploying its

available resources.

128

Marketing capabilities are important marketing-related

mechanisms that refer to the ﬁrm’s ability to perform

marketing routi nes and attain marketing objectives to im-

prove its competitiveness and generate economic rents.

129

The aggressiveness shows the entrepreneur’s behavior in

responding to market demands and dealing with compe ti-

tors.

Market sensing is deﬁned as the capability to sense

opportunities invol ving scanning and monitoring the en-

vironment, reviewing, and detecting the effect of changes to

it.

The expanding market is inﬂuenced by successful

branding in SMEs. The well-established brands make the

customer familiar with the products and services of the ﬁrm.

The resistance to the branding o f the owners or managers

inﬂuenced the capability to upgrade their market.

The

upgrading of SME markets is also inﬂuenced by product

brand creation that requires active engagement from the

actors in SMEs.

Theme 3: Innovation perspective

The innovation was explained as the factors that drive

owners to create new products and improve the ch ances of

the ﬁrms’ success.

The developed and developing

countries have investigated SME factors consisting of in-

novation capability, willingnes s to innovate, risk-taking,

proactiveness, knowledge, creativity, intellectual property

rights, innovation culture, and innovativeness. Although

they both investigated the innovation, the focuses were

different. Based on the number of articles, the innovation

factors in developed countries were more focused on the

entrepreneurial orientation that consists of proactiveness,

risk-taking, and innovativeness.

50,97,100,101

Meanwhile,

developing countries were concerned about knowledge and

innovativeness.

The owner’s innovation capability is characterized by the

ability to develop new products according to market de-

mand.

This innovation requires knowledge as a key in-

tangible resource that properly leads and represents a way to

create more value in a ﬁrm.

Additionally, it needs pro-

activeness, which is deﬁned as the initiative process of the

owner or manager to seek opportunities related to the op-

eration, product, brand, and strategies to enhance the

competitive advantage.

50,100,101

Meanwhile, risk-taking is

also critical as the commitment and willingness of managers

to make risky decisions.

The innovation capability is also related to intangible

assets from the entrepreneurs, like intellectual property

rights in terms of patents and industrial designs. Intellectual

property rights are extremely important to develop market

opportunities.

The intellectual property in product and

services are capable of measuring the innovation capability

in SMEs.

Based on the literature review, intellectual

property was investigated in developed and developing

countries. The psychological attributes pull business

owners’ attention to develo p their businesses, such as will-

ingness to innovate.

130

The willingness to innovate comes

from an individual who is willing to develop new ideas,

experiments, products, services, or technologies.

46,56,101

While creativity in SMEs growth is deﬁned as entrepreneur

originality in generating ideas, innovation should be seen as

a treatment, improvement, and, more critically, the imple-

mentation of these ideas.

108

Hence, the innovation capabil-

ity supports marketing capability to achieve competitive

advantage.

131

Innovation is inﬂuenced by innovation culture.

103

Inno-

vation culture reﬂects a degree to which values, norms, and

atmosphere support the organization’s innovativeness.

132

The owner or manager in SMEs has the responsibility to

encourage the employees to become alert, creative, and

innovative to drive a successful organization.

Theme 4: Technology adoption perspective

The literature study from empirical research showed that

technology adoption had a positive relationship with SME

performance.

13,15,22,25,133

The SMEs face challenges in

8 International Journal of Engineering Business Management

increasing information systems knowledge and technology

to control industrial productivity and market share.

112

The

technology adoption in SMEs particularly information

technology (IT) such as social media and e-commerce was

capable of enhancing the existence of SMEs in both de-

veloped and developing countries.

22,64

The digitalization

era, indeed, causes SMEs to face the creation of vast

amounts of data. This situation urges them to deal with ever-

increasing data generated from digital transactions, click-

streams, voice, and video channels.

The develo ping countries examine indicators related to

technology adoption more extensively than developed

countries. Small and Medium Enterprises (SMEs) in de-

veloping countries have also conducted studies such as big

data analysis to develop business insights by using data

management, foundation information technology, and tal-

ent.

113

In previous research, the technology capability in-

dicates that entrepreneurs use an application to help them

perform their job better.

134,135

In practice, leaders are re-

sponsible for motivating employees to follow new tech-

nology.

Technology adoption also requires trust in

technology security for process business.

Theme 5: SME partnership perspective

The partnership perspectives describes the entrepreneur’sin-

tention and behavior toward SME activities in managing re-

sources through partnership or collaboration.

136

In developed

and developing countries, the literature discussed some factors

that inﬂuence SME partnerships. The most important factor

discussed in SME partnerships was personal network. The

developed countries investigated factors from a partnership

perspective: partnership quality, coordination capability, col-

laboration capability, and knowledge sharing. Meanwhile, the

research in developing countries has identiﬁed factors related to

SME partnerships, such as strategic alliances and willingness to

collaborate. The personal network is described as a way of

measuring the number of resources available to an entrepreneur

through the network.

137

The entrepreneur who has a personal

network is deﬁned as the person with whom a decision-maker

has direct relationships or indirect relationships via direct re-

lationships.

115

The personal network engages with access to

knowledge, support, and resources for SME development.

Partnership in SMEs is shown in supplier relationships in the

supply chain, which aims to increase proﬁts and reduce

costs.

138

In developed countries, the research investigated factors

that inﬂuenced SME partnerships, such as coordination

capability, collaboration capability, and partnership quality

to manage partnerships.

The coordination capability de-

scribes the effort to integrate external and internal activities

and resources more efﬁciently.

Moreover, it reduces

conﬂicting objectives and uncertainties in corporations. The

collaboration capability explains that the owner has the

capability to collaborate with external parties.

117

The

partnership quality helps SMEs to be co mpetitive with the

principle of joint and mutually dependent actions based on

mutual trust, commitment, and business understanding,

resulting in improved performance. The partnership quality

refers to an SME’s perception regarding how effectively

partnership results satisfy expectations.

In developing countries, factors for SMEs’ growth in a

partnership perspective covered the willingness to collab-

orate

118

and strategic partnership.

The partnership en-

gages with the willingness to collaborate from the

entrepreneurs.

118

Further, willingness to collaborate is

concerned with assessing a partner’s attitudes and intentions

towards concrete collaboration situations.

139

In addition,

trust and social capital were the drivers to establish alli-

ances, creating mutual dependencies and hence contributing

to the resiliency.

140

Strategic alliances inﬂuence the per-

formance of SME partnerships. They explain the collabo-

ration of SMEs with other enterprises to break through the

market barrier and strengthen the market position to

competitors.

In strategic alliances, the enterprise needs the

SME owner to consider the capability to combi ne resources,

enhance the market, and improve skill and technology to

make SMEs more competitive.

Theme 6: Entrepreneur personality perspective

The growth of SMEs is also inﬂuenced by the entrepre-

neur’s personality. The entrepreneur personality belongs to

psychological attributes that pull business owners to de-

velop their businesses.

130

In this review, both developed and

developing countries have studied growth. The entrepreneur

personality was observed in the intention growth of

SMEs,

7,27 ,89,119,121

leadership behavior,

39,14 1

motivation,

40,55 ,81

commitment,

76,122

and self-conﬁdence.

The intention to grow a business is an essential char-

acteristic of entrepreneurial behavior. It represents the en-

trepreneur’s intention to grow the business and maximize

proﬁt.

It also reﬂects SME owner-managers interest in

expanding their business and taking opportunities.

119

The

business expansion in SME is inﬂuenced the leadership

behavior. The owner’s intention to grow is also called

growth aspiration, which describes the desire of the business

owner to achieve a higher level of business growth.

121

The entrepreneur personality that inﬂuences SME growth is

leadership behavior. The leadership behavior of SME owners

or managers shows the ability to develop strategic agendas and

work with strategy development to enhance SME growth.

terms of SME performance, leadership behavior can be deﬁned

as the behavior in transformational leadership where the leader

can articulate the vision for the future, provide an appropriate

role model, foster acceptance of goals, set high-performance

expectations, and provide individual support and intellectual

stimulation.

122

The leadership behavior of SME owners or

Fajarika et al. 9

managers shows the ability to develop strategic agendas and

work with strategy development to enhance SME growth. The

SME owners express their growth ambitions and approach

growth proactively. They actively search for opportunities and

emphasize this search in their strategic thinking.

The entrepreneur must have personal commitment, moti-

vation, and self-conﬁdence to maintain the continuity of SME

growth. Personal commitment is the dedication or willingness

of entrepreneurs to conform to the agreed practices in enter-

prises to enhance the SME market.

The market performance

is an indicator of the growth of SMEs.

The growth of en-

terprises (or lack of it) is dependent on the entrepreneur’s

motivation at the birth of the enterprise and during the en-

terprise’s survival time. The entrepreneur’s motivation deﬁnes

what they do and what they do not do, which determines the

future growth of the enterprise.

Next, self-conﬁdence indi-

cates the personality of the entrepreneur in preparing and

implementing planning, facing new challenges, making de-

cisions about important matters, and taking efﬁcient action to

cope with the problem.

In this literature review, the entrepreneur personalities in

developed countries were marked by open-mindedness and

resilience. Open-mindedness describes that entrepreneurs must

be open to new things that can help them do business.

108

The

resilience investigated the psyc hological condition of the en -

trepreneur personally to recover from failure.

Resilience has

been proven to support organizations in integrating the capa-

bility to adapt to unfavorable conditions, i dentifying potential

threats or signiﬁcant developments, and ensuring thorough

preparedness for unforeseen occurrences.

124

In developing

countries, there is still a need for the development of capabilities

in adaptation and anticipation.

124

The adaptation capabilities

revealed that the ability of businesses to adapt to unfavorable

conditions and take advantage of changes maintain resilience,

enabling to continue business growth. The anticipation capa-

bilities explain the capacity for observing internal and external

changes; the capability to identify potential threats or signiﬁcant

developments, and thorough preparedness for unforeseen

occurrences. In developing countries, the entrepreneur per-

sonalities were characterized b y perceived risk and perceived

barriers.

125

Perceivedriskisdeﬁn ed as the entrepreneur who is

willingtotakeariskofabusiness.

125

Perceived barrier is in-

terpreted as one’s assessment of the difﬁculty of social, personal,

environmental, and economic barriers in a particular behavior

relatedtoSMEgrowth.

142

Theme 8: SME growth indicator

The SME growth was measured by indicators ( Table 3).

From an entrepreneurial perspective, the SME ’s growth can

be summarized as business owners wanting to increase

their market share by expanding their business

performance.

37,48,144

SME growth means the improved ﬁ-

nancial performance of an organization, which is often

measured by ﬁnancial indi cators.

Evidence has shown that SME growth could be mea-

sured by a change of the amount of sales growth in terms of

revenue in several years.

6,16,37,82,92,95,96,120,144,148,150,152,153

Usually, sales growth is in line with the increase in sales

volume. Thus, the SME growth used ﬁrm indicators such as

sales growth,

37,52,61,66,144,152

employment growth,

proﬁt

growth,

9,12,65,71,148

market share growth,

12,19,37,87,144

turnover, growth,

11,17,52

and export rate.

72,153

The framework of SME growth from an

entrepreneurship perspective

This article used qualitative synthesis to identify relation-

ships between variables and develop the framework. From

the literature, there were six factors that inﬂuenced SME

growth, consisting of human capital resources, entre-

preneur personality, technology adoption, mark eting

capab ilities , innovation capabilities, and SME partner-

ship. Table 4 shows the relationship between factors in

previous studies. The study found seven factors as co n-

structs. Eac h construct has indicators that are used to

Table 3. SMEs growth indicators.

SMEs growth indicator Sources

Sales growth

2,32,37,38,47,50,56,72,82,93,95–97,101,108,117,120,148,149

11,13,19,24,43,48,51,52,60,61,63,66,70,99, 104, 105 , 113, 145,150,151

[N = 40]

Sales volume

37,47,85,144

[N =4]

Proﬁt

34,56,57,59,71,85,100,119,130,148

9,12,19,24,45,52,61–63,65,70,83,104,105,123,145 , 151

[N = 27]

Market share growth

37,50,57,88,95,120,128,133,125,12,19,45,48,52,60,63,104,112,113,151

[N = 20]

Number of

employees’ growth

47,49,50,56,57,96,108,148

17,24,60,104,106,113

[N = 14]

Export growth

72,88

[N =2]

Quality of product

and service

[N =1]

Number of customers

[N =1]

10 International Journal of Engineering Business Management

measure their level. The relationship matrix displays

that entrepreneur personality has a relationship with

SMEs’ growth

38,47,49,55,86,97,108,119,120,130

and innovation

capability.

2,97,141

The techn ology a doption factor has a relationship with

marketing capabilities,

24,73

innovation capabilities,

22,65,71,95

and SME partnerships. The technology adoption in SMEs,

particularly social media, increased SMEs’ competitive-

ness in marketing capability. Social media is an inex-

pensive technology platform and accelerates the sharing of

information between partners and customers, thereby ac-

celerating product brand marketing.

The technology

adoption can be used to improve business data processing

capabilities for the information availability that is needed

to make decisions in innovation strategies.

22,95

The use of

the technology also inﬂuenced SME partnership. The

technology particularly IT can facilitate SME activities in

supporting coordination capabilities with both internal and

external partners.

71,144

The innovation capability has a relationship with mar-

keting capabilities.

22,71

The ability to innovate is shown in

the product innovation orientation, which is related to

market sensing to customer needs.

The mark et sensing to

the customer is the indicator of marketing capability.

88,92

The higher the results of innovation that are in accordance

with consumer needs, the higher the opportunity to increase

the market.

Innovation capability is inﬂuenced by en-

trepreneur personality.

2,97,141

The relationship between

entrepreneur personality and SME growth is shown by

growth intention.

7,27,89,121

The SME partnership has an associatio n with mar-

keting capabilities.

The partne rship in SMEs is char-

acterized by entrep reneurial networking. Entrepreneurial

networking refers to entrepreneurs building and forming

links with external entities.

18,115

It includes entrepre-

neurs’ behavior in creating and forming ties, such as

networking style, strategies, and processes that support

market growth. Previous studies reported that the SME

partnership in the supply chain increased sa les growth.

154

In addition, it has a relationship with innovation capa-

bility

104

and resources.

The partnership is an essential input to innovation ac-

tivities, particularly in SMEs.

155

Ease of access to resources,

for instance, is greatly inﬂuenced by partnerships. Thus,

SMEs seek strategies to reduce production costs by de-

veloping business partners to increase the avail ability of

resources.

The resources can be in the form of investment

and availability of raw materials.

The matrix relationship

showed the relationship between constructs.

Human capital resources have an association with SME

growth.

11,43,55,56,73 , 79,81,84,101

Interestingly, they do not

have a relationship with other constructs. In developed and

developing countries, each construct has a relationship with

SME growth. However, the relationship between SME

Table 4. Relationship matrix between constructs.

Constructs Human

capital

resources

Human

capital

resources

Entrepreneur

personality

Technology

adoption

Technology adoption

Marketing

capabilities

24,37,73,143

(N = 2) Marketing

capabilities

Innovation

capabilities

2,97,141

(N =3)

22,65,71,95

(N =4)

22,71

(N = 2) Innovation capabilities

SME

partnership

144

(N =1)

104

(N =1)

(N = 1) SME

partnership

SME

growth

11,43,55,56,73,79,81,84,101

(N =9)

7,27,33,38,47,49,55,86,97,108,

119–121,123,127,130,145

(N = 17)

9,13,25,26,52,57,60,62,63,66,85,

110,112,113

(N = 14)

9,17,19,24,37,42,47,

62,63,68,87,92,96

(N = 13)

17,32,35,62,69,86,94,104,29,50,75,83,97,

100,101,122,123,126,134,146,92

(N = 21)

32,101,147,51,

83–86

(N =8)

31,42,51,57,144

(N =5)

N = number of articles.

Fajarika et al. 11

partnership and SME development is found only in de-

veloped countries.

The framework (Figure 5) describes the relationship be-

tween each factor related to SMEs’ growth. The framework

explained that constructs have an association with SME

growth. The ﬁrst factor is the entrepreneur demograp hic. The

entrepreneurs ’ demographics cover several factors, e.g., level

of education, gender, age of owner, experience, and expertise.

There are no differences in demographic factors between

developed and developing countries. The second factor is

entrepreneur personality. The third factor is marketing capa-

bilities. The marketing capabilities show the capability of the

entrepreneur to use available resources to carry out marketin g

tasks and produce desired marketing outcomes.

128

The mar-

keting capability is a construct that is measured by market

sensing, product brand creation, resistance to branding,

and aggressiveness. The fourth factor explains innovation

capabilities have measurement indicators in the form of

willingness to innovate,

75,97,98

risk-taking,

50,56,76,97,100–102

proactiveness,

50,68,76,97,100–102

creativity,

59,72,96

intellectual

property rights,

51,72

innovation culture,

22,39,102

product inno-

vation orientation,

and innovativeness,

50,59,68,76,101,108,109

and resistance to change.

The ﬁfthfactorsarefollowedbytechnologyadoption.

Technologyadoptionismeasuredbysocialmediaadoption,

e-commerce usage , IT capability, and big data analytics ca-

pability. Research on technology adoption for SMEs has been

developed nowadays. It is used to measure the technology

adoption readiness, level of behaviour, intention to adopt,

perceived risk, and perceived barrier. The sixth factor is SME

partnership, which is interpreted as the factor that shows the

ability of SMEs to partner and collaborate. The factors include

personal network, partnership quality, collaboration capability ,

coordination capability, knowledge sharing, strategic alliances,

and willingness to collaborate. The SME partnership has a

relationship with SME growth.

41,117,15 6

The seventh factor is

entrepreneur personality is measured by growth intention,

leadership behavior, motivation, commitment, perceived risk,

self-conﬁde nce, and perceived barriers.

Figure 5 shows that innovation capabilities are the most

studied factors in SME growth research. The relationship

between factors is shown by the thickness of the arrow. The

thicker arrow indicates the more articles that were discus-

sing the same thing. Of the many factors, the entrepreneur

demographics show that level of education was the most

studied facto r.

Figure 5. SME growth framework in entrepreneurship perspective.

12 International Journal of Engineering Business Management

Interestingly, this study documented the most studied

items o f each factor. For example, in the entrepreneurs’

personality factor, the growth intention was a factor that has

been extensively studied. In technology adoption, IT ca-

pability has been studied the most in both developing and

developed countries. In resources, capital availability was

the most studied in growth. The most studied factors in the

SME partnership, marketing capability, and innovation

capability were the personal netw ork, market sensing, risk-

taking, and innovativeness. In developed and developing

countries, each construction had a relationship with SME

growth. However, the relationship between SME partner-

ship and SME growth was only found in developed

countries. In developed countr ies, more personality factors

have been discussed than in developing countries, partic-

ularly for open-mindedness

76,108,122

and resilience.

The

growth of SMEs is inﬂuenced by entrepreneurs’ demo-

graphics factors. The level of education, for instance, gives

opportunities for knowledge enhancement to create prod-

ucts that support the growth of enterprises.

The owner’s

level of education particularly inﬂuences turnover growth or

sales growth.

Research indicated that entrepreneurs who

had an education above high school up to a degree showed a

higher percentage of improvement.

Other demographics

factors, such as the age of the entrepreneur affect SME

performance, where SME growth is more rapidly devel-

oping in younger entrepreneurs.

Unfortunately, certain

demographic factors, such as gender, have become a

problem in the growth of SMEs because women entre-

preneurs have many barriers to developing SMEs quickly

because of cultural barriers, lack of spouse support, and lack

of conﬁdence in operational business.

The marketing capabilities factors in developed and

developing countries have been measured with market

sensing

9,13,55,73,82

and product brand creation.

47,89,91

Indi-

cators of resistance to branding are only studied in devel-

oped countries.

67,93

Meanwhile, the marketing capabilities

in developing countries investigated aggres siveness

showing the behavior of the entrepreneur in responding to

market demand and deals with competitors.

In developed

countries, discussion is more directed to the brand of SME

products, which is believed to be one of the factors that are

increasing progress in the market. The market capabilities in

developing countries emphasis the level of aggressiveness

of entrepreneurs to develop their markets.

From the entrepreneurial perspective, technology

adoption is a widely discussed topic in previous research.

Technology adoption has experienced developments in

research. The technology adoption measurement in SMEs

has started with technology acceptance.

7,15,66

The previous

literature measured technology acceptance by investigating

the behavior intention to adopt, perceived risk, and per-

ceived barrier of entrepreneurs in technology. The tech-

nology adoption level in developed and developing

countries has been measured by IT capabilities, social media

adoption, and e-commerce adoption. In particular, social

media is the easiest technology for SMEs to use in de-

veloping countries.

E-commerce technology is used to

market products in SMEs.

The topic of technology

adoption in developing countries that has become a research

trend is big data analytics capability.

22,62,112,113

Big data

analytics is a technology that needs to be considered be-

cause SMEs are facing the digital age, which requires a lot

of data storage and data analysis to assist in planning,

evaluating, and creating strategies for operations and

business activities.

113

The framework shows that innovation capability is the

factor that is mostly researched in relation to SME growth.

Based on 21 studies that explicitly discover an inﬂuence

between innovation capability and SME growth in both

developed and developing countries. In developed coun-

tries, innovation capability is inﬂuenced by entrepreneur

personality and technology adoption. Meanwhile, in de-

veloping countries, innovation capability is inﬂuenced by

partnerships. The progress of SME s in building innovation

is driven by partnerships in building networks with sup-

pliers, customers, and business partners.

104

Discussion

This paper provides insights into the critical factors inﬂu-

encing the growth of small and medium-sized enterprises

(SMEs) in both developed and developing countries. This

study successfully identiﬁed six factors that inﬂuenced SME

growth, consisting of human capital resources, entrepreneur

personality, technology adoption, marketing capabilities,

innovation capabilities, and SME partnership. The most

investigated factor in developed and developing countries is

innovation capabilities. The innovation is the strategies

carried out by enterprises to utilize existing resources for

new breakthroughs in product and service development to

strengthen the competitiveness of SMEs.

In contrast, the

least studied factor is SMEs partnership. The partnership of

SMEs is characterized by personal networks in developed

and developing countries.

44,104,115

The key differences between developing and developed

countries is the empha sis in indicator in each factor and the

interrelationship betw een factors. Indicators in developed

countries that are not addressed in developing countries

include human capital resources, innovation capabilities,

entrepreneur personality, marketing capabilities, SME

partnership, and SME growth. The factor of human capital

includes the successor availability indicator used to measure

SME sustainability. SMEs need to pay attention to entre-

preneur personality factors, reﬂecting the growth intentions

of business owners to enhance SME performance.

The

SME partnership, which features different indicators such as

partnership quality, collaboration capability, and

Fajarika et al. 13

coordination capability. The indicator offer insight that

partnerships require strategies to measure the quality of the

undertaken partnerships.

In the innovation factor, devel-

oped countries investigated product innovation orientation

to develop new products. The product innovation orienta-

tion indicates the commitment of SME owners to engage in

research and development for product development.

Regarding entrepreneur personality, the indicator of resil-

ience is used to measure market shock resilience. In mar-

keting capabilities, developed countries have investigated

resistance to branding, which measures owner behavior in

brand building.

67,93

Developed countries have measured

SME growth not only in economic scales such as sales

growth, employment growth, and market share growth but

also in indicators such as the quality of products, the number

of customers, and export growth.

In developing countries, indicators that are not explained

in developed countries include innovation capabilities,

entrepreneur personality, technology adoption, and SME

partnership. In the innovation facto r, developing countries

investigate resistance to change, indicating that SME

owners in these countries still face resistance to innovation.

Regarding entrepreneur personality indicators in develop-

ing countries, the focus is on perceived risk and barriers, as

SME owners in these countries still perceive risks and

barriers to strategic decision-making for SME development.

In technology adoption, developing countries face issues of

trust in technology adopti on and the ability to use big data

analysis.

15,114

In SME partnership, developing countries

encounter problems with willingness to partner, where the

role of the owner in initiating partnerships is crucial.

118

Indicators of SME growth used by developing countries still

focus on economic aspects. The ﬁndings suggest that de-

veloped countries have explored more relationships among

variables compared to develo ping countries.

The interrelationships (Figure 5) revealed that the

structured framework suggests theoretical implications that

developed countries have focus on innovation capabilities

to support marketing capabilities.

22,71

Innovation activities

can ﬁnd new market opportunit ies, thereby enhancing

market conditions.

In developed countries, the innovation

capability serves as a strength to confro nt market co mpe-

tition, maintain product brand quality, and compete on

pricing, thereby maintaining market presence. The inno-

vation capabilities are supported by the entrepreneur per-

sonality of SME owners such as motivation, growth

intention, and strong commitment. SMEs in developed

countries have gone further to analyze the resilience of

entrepreneurs as a form of strength in facing uncertain

market.

The marketing capabilities is inﬂuenced by

technology adoption. The impact of technology adoption

not only on marketing capabilities but also more extensively

on innovation capabilities

22,65

and SME partnerships.

144

Technology adoption has implications for the level of

innovation in SMEs. The use of technology contributes to

increase knowledge in the process of creating innovation.

This knowledge enhancement in innovation inﬂuences the

outcomes that align with customer needs, thereby creating

opportunities for increased proﬁts. Technological capabil-

ities have implications for facilitating partnership processes

among enterprises along the value chain.

144

The partnership

processes of SMEs are supported by technology capabilities

in integration and coordination processes that inﬂuence

partnership enhancement and the fast growth of SME

performance.

Moreover, these SME partnerships reinforce

marketing capabilities through networks used as a strategy

for marketing processes to enhance market share.

The interrelationships identiﬁed in developed countries

serve as a guide for developing countries to enrich studies

on the development of SMEs. Developing countries require

development in terms of marketing capabilities and part-

nerships to becom e market leaders.

144

In developing

countries, SMEs need to adopt several steps taken by de-

veloped countries, such as the adoption of technology to

enrich their knowledge about innovation in bo th products

and processes, and evaluating the market. Developing

countries need a strategy to strengthen the entrepreneurial

personality to foster interest in innovation, where SMEs

particularly require entrepreneurs with a strong desire to

cultivate innovation. Furthermore, the interrelationship

between entrepreneur personality and innovation capabil-

ities need to studied in developing countries. This insight

serves as input for developing countries to adopt factors

such as innovation and partnerships to improve their

marketing capabilities.

The ﬁndings reveal several gaps regarding the indicators

that used to measure SMEs growth in developing countries.

The factor of human capital resources, particularly the

availability of successors, and the interrelationship between

entrepreneur personality needs to be examined in developing

countries for the sustainability of SMEs. In developing

countries, the measurement of SMEs growth typically relies on

economic scales such as sales growth,

10,12,18,23

employment

growth,

16,23,49

and market share growth.

11,18,44,49

The devel-

oping countries need to upgrade indicators of SME growth

such as the quality of products, the number of customers, and

export growth, which have already been undertaken by de-

veloped countries. The growth of SMEs is concerned with

maintaining demand by focusing on the quality of products

and services and increasing the number of customers each year .

SMEs in developing countries need to pursue markets similar

to those in developed countries, not only domestically but also

internationally, as indicated by export growth indicator.

Practically, this research contributes to SME owners and

policymakers in evaluating growth of the SMEs based on

the identiﬁed factors. The framework can be employed to

formulate models and predict the level of SME growth.

This can be valuable in providing solutions and

14 International Journal of Engineering Business Management

recommendations for SME development through resources

and capabilities factors. For owners or managers, the critical

factors can be used to assess SME performance through

multi-perspective evaluation. The perspective of factor is

innovation, marketing, technology, SME partnership, hu-

man capital resources, and entrepreneur personality. Poli-

cymakers can utilize these growth factors to consider

strategies for SME development, focusing on innovation

and marketing capabilities. Practitioners need to consi der

the organization’s capability in partnering with other SMEs

and organization to expand networks that can broaden

market share. The partnership related with technology in-

vestment that necessary to enhance connection in business

networking. The technology also enhance knowledge for

innovation, improving product quality, and targeting new

markets.

Based on the literature review, the future research agenda

encompasses opportunities to investigate the interrelation-

ship between factors such as innovation capabilities, en-

trepreneur personalities, human capital resources affecting

marketing capabilities, SME partnerships, and in devel-

oping countries. The growth of SMEs is needed to address

questions on how to measure SME growth using multidi-

mensional factors from economic, social, and behavioral

aspects to generate comprehensive measurements. Subse-

quent research should focus on designing growth models

that simulate growth through mathematical modeling and

optimize the use of resources for optimal SMEs growth.

Moreover, this research ﬁeld remains open to predictive

studies employing both qualitative and quantitative factors.

to simulating models that consider non-linear conditions

and understand trends in SME development, allowing for

the formulation of scenarios to enhance SME growth.

Conclusions

This study addresses the research question by providing

critical factors and framework for SME growth based on a

literature review. The results indicate that the development

of SMEs in multi-perspectives factors is not only viewed as

organizational level but also individual development. The

results identify six categories signiﬁcant factors from multi-

perspective for SME growth including human capital re-

sources, marketing capability, innovation capability, tech-

nology adoption, SME partnership, and entrepreneur

personality. Each factor is accompanied by indicators to

measure different levels of SME growth factors. The most

signiﬁcant factor in developed countries is human capital

resources, SMEs partnership and entrepreneur personalities.

Moreover, the developing countries revealed that the sig-

niﬁcant factors including technology adoption. is a factor

that inﬂuences both developed and developing countries.

The interrelationship factors showed that each of critical

factors have relationship with SMEs growth. There are

several differences of relationship factors between devel-

oped and develo ping countries. In developed countries, the

innovation capability and SME partnership have interre-

lationship with marketing capabi lities. Additionally, the

innovation capabilities are inﬂuenced by entrepreneur

personality and technology adoption. The technology

adoption has interrelationship with SME partnership. In

contrast, the developing countries only has one interrela-

tionship between SMEs partnership and innovation

capabilities.

This study contributes to theoretical implications for

fostering SME growth by examining the interrelationship

between factors. Firstly, developed countries have fully

recognized that the critical factors investigated should be

able to cultivate the marketing capabilities of SMEs, the

marketing capabilities increase the opportunities for market

share growth. Almost all interrelationship factors follow a

path toward marketing capabilities (except human capital

resources) before leading to SME growth. This aligns with

indicators in developed countries, which have concentrated

not only on achieving domestic growth but also on export

growth and the number of customers they possess. Sec-

ondly, marketing factors are inﬂuenced by innovation ca-

pabilities and SME partnerships in developed countries.

Innovation capabilities serve as a strength to face market

competition, maintain product brand quality, and compete

on pricing. The SME partnerships act as a force to expand

networks and open up new market opportunities. Thirdly,

the technology adoption factor is not only used as a mar-

keting strategy but, more importantly, to enhance innova-

tion capabilities, resulting in increased knowledge about

products and process improvement. Fourthly, developed

countries have depicted that SME growth is inﬂuenced by

entrepreneurial personality as one of the factors indicating

that the emergence of innovation is driven by the individual

character of the SME owner. Fifthly, developed countries

have recogni zed that the sustainability of SMEs requires

human capital resources, particularly in terms of successor

availability. Therefore, this has implications for developing

countries to consider strengthening factors similarly to

developed countr ies.

In terms of managerial implications, the ﬁndings assist

practitioners in assessing businesses based on human capital

resources, entrepreneur personalities, and competencies.

The human capital resources contributed to ensuring the

sustainability of SMEs through the preparation of successor

availability. Competencies such as innovation capabilities,

marketing capabilities, technology adoption, and SME

partnerships can be utilized to formulate business strategies.

Marketing capabilities and technology adoption play a

crucial role in expanding the target market for SMEs. In-

novation capabilities and SME partnerships aid practi-

tioners in driving income through product innovation.

By understanding entrepreneur personality factors,

Fajarika et al. 15

practitioners can enhance individual personal qualities to

contribute to the improvement of enterpris e innovation

capabilities. The interrelationship among these factors helps

managers balance the roles of marketing, innovation,

technology, and partnership competencies when designing

SME growth strategies.

The study has limitations in terms of examining the

stages of SME growth. This study does not discuss the

relationship between factors and the types of SME growth

levels. The framework formulated does not indicate re-

ciprocal relationships. This reciprocal relationship is needed

to understand the behavior between one factor and another

factor that is non-linear. This study lacks consideration of

uncertainty conditions that may interact with SMEs’ factors.

The literature study only uses journal articles and does n ot

include studies in the form of proceedings. This study has

limitation on lack of strong contribute to innovation and

new ideas from proceeding article due to the journal has

longer time publication than the proceeding.

Essentially, this literature study can be employed as a

starting gate for further research. Further research on SMEs’

critical factors is needed to investigate the interrelationship

factors between technology adoption, innovation and

marketing capability, and entrepreneur personality in de-

veloping countries. These interrelationship factors are un-

derexplored in developing countries. This topic has

opportunities to explore the indicator and factors of part-

nership in developing countries. According to the literature

review, there is a great opportunity to conduct research

using this framework to simulate the relationship factors

into a quantitative model and investigate the relationship

between factors of SME growth. Research using simulation

approaches needs to be further conducted to predict future

SME growth. The research remains open to examine human

capital resources and innovation capabilities factor inﬂu-

encing in both of countries.

Author contributions

Dian Fajarika developed the research framework, collected the

data, performed the analysis, and wrote the manuscript with

support from Fitri Trapsilawati and Bertha Maya Sopha. Fitri

Trapsilawati and Bertha Maya Sopha supervised the project,

provided critical feedback, and helped shape the research, analysis,

and manuscript.

Declaration of conﬂicting interests

The author(s) declared no potential conﬂicts of interest with re-

spect to the research, authorship, and/or publication of this article.

Funding

This work was supported by Final Project Recognition Grant

Universitas Gadjah Mada (Grant Number: 5075/UN1.P.II/DitLit/

PT.01.01/2023).

ORCID iD

Fitri Trapsilawati



https://orcid.org/0000-0002-0482-4643

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