A Comparative Study of Strategic Planning Practices of SMEs and Large‐Sized Business Organizations in Emerging Economies: The Case of UAE

• Date: 01 November 2015
• Author: C. Muhammad Siddique
• DOI: http://doi.org/10.1002/jsc.2039
• Published date: 01 November 2015

RESEARCH ARTICLE

Strat. Change 24: 553–567 (2015)

Published online in Wiley Online Library

(wileyonlinelibrary.com) DOI: 10.1002/jsc.2039

Copyright © 2015 John Wiley & Sons, Ltd.

Strategic Change: Briengs in Entrepreneurial Finance

Strategic Change

DOI: 10.1002/jsc.2039

A Comparative Study of Strategic Planning Practices

of SMEs and Large‐Sized Business Organizations in

Emerging Economies: The Case of UAE1

C. Muhammad Siddique

College of Business Administration, American University in the Emirates, Dubai, UAE

While SMEs in the emerging economy of UAE have begun to use strategic

planning tools such as nancial analysis, PEST analysis, cost–benet analysis,

and core and distinctive competency analysis, they are still far behind large‐sized

business organizations.

Small and medium‐sized enterprises (SMEs) are widely regarded as key drivers of

innovation, economic growth, and employment in the world economy. In emerg-

ing markets, in particular, SMEs have played a crucial role in creating employment

opportunities as well as making a substantial contribution to the GDP (Abdulla

and Bin Bakar, 2000; Kutllovci and Shala, 2013; John, 2014). In the United Arab

Emirates (UAE), SMEs have been a potent force in the growth and expansion of

the country’s commercial industry. It is estimated that SMEs account for more

than 90% of economic projects in the UAE, provide employment to over 60%

of the workforce, and contribute more than 70% to the UAE’s GDP (Emine,

2012). Larger business organizations frequently regard SMEs as their primary, and

perhaps most formidable, competitors. However, strategic planning in the SME

sector is still rudimentary compared with large‐sized organizations (Kukalis, 1994;

O’Regan and Ghobadian, 2002; Stonehouse and Pemberton, 2002; Kraus et al.,

2006; Wang et al., 2007, Reboud and Mazzarol, 2008). is study was undertaken

to look at the usage of strategic planning tools and techniques among SMEs and

large‐sized business organizations in the emerging economy of the UAE to identify

areas where SMEs must focus to develop and sustain their competitive advantage.

Although it is quite fashionable to talk about strategy in the business world,

empirical research on strategic planning practices has been somewhat sparse,

especially in the Arab Gulf region. Consequently, little is known about the nature

of strategic planning and the type of planning instruments used by SMEs or their

counterparts, the large‐sized business organizations. Dubai, with its good mix of

multinationals and SMEs, provides a proper setting to explore and identify the

1 JEL classication code: M1.

SMEs based in UAE and other

emerging economies can benet

from the strategic planning tools

and processes employed by their

counterparts in developed

economies.

With better training and

professional development

programs, companies can expose

employees to new developments

in strategic management theory

and practice.

Increasing competition in

emerging economies with an

inux of multinational companies

is likely to call for more

systematic strategic planning

models involving the use of

sophisticated planning tools and

techniques as sources of

competitive advantage.