Entrepreneurial Competencies and Small-Scale Manufacturing Performance: The Mediating Effect of Manufacturing Capability in Ghana

Abstract

This study investigates the effect of entrepreneurial competencies on the performance of small scale manufacturing firms in Ghana, where manufacturing capability acts as a mediator. Grounded in the Resource-Based View theory, positivist paradigm, deductive research approach and cross-sectional explanatory research design were employed in this study. Data was gathered from 435 owners/managers of enterprises in Southern, Middle and Northern parts of Ghana through a structured questionnaire. Partial Least Squares Structural Equation Modelling (PLS-SEM) was used to analyse the data. The results showed that entrepreneurship competencies contribute positively to manufacturing capability and small-scale manufacturing performance. Additionally, manufacturing capability has a positive influence on small-scale manufacturing performance and mediates the relationship between entrepreneurial competencies and small-scale manufacturing performance. The study findings underpin the importance to strengthen entrepreneurial and manufacturing capabilities to generate competitive advantage for small scale manufacturers in Ghana. The findings are also relevant to SME owner-managers and policy makers in supporting policies that concern on growing the SMEs sector in developing economies such as Ghana.