The Design of Projects As Added Value In The Management of Small and Medium Enterprises in Mozambique

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ORIGINAL ARTICLE

ARMINDO, Adalberto Paulino Falso [1], SILVA, Adriana Ferreira da [2]

ARMINDO, Adalberto Paulino Falso. SILVA, Adriana Ferreira da. The Design of Projects As Added Value In The Management of Small and Medium Enterprises in Mozambique. Revista Científica Multidisciplinar Núcleo do Conhecimento. Year 06, Ed. 04, Vol. 11, pp. 84-101. April 2021. ISSN: 2448-0959, Access link: https://www.nucleodoconhecimento.com.br/business-administration/design-of-projects ‎

ABSTRACT

Nowadays, the challenges of small and medium-sized enterprises are their continuity in the market, so that this occurs they depend on the abandonment of traditional management models and the adoption of modern management models. Therefore, the design is seen as a methodology of operations and innovations in organizations. Believing in the preliminary context described above, the following question was asked: what factors are associated for the absence of a project design to add value in the management of small and medium-sized enterprises in Mozambique? And to give the answers about the research problem, the general objectives were formulated: to study the factors that are associated with the absence of project design in the management of small and medium-sized enterprises in Mozambique and, as specific: (i) describe the organizational models applied in the management of small and medium-sized enterprises; (ii) to raise theoretical and practical designs on organizational project management; (iii) Identify the factors that associate for the absence of project design in the management of small and medium-sized enterprises and (iv) define possible organizational models for the management of small and medium-sized enterprises. The article had a quantitative and qualitative approach and is an exploratory research. This article brings as results a new paradigm for the management of mozambican small and medium-sized enterprises. It also brings the contribution and opportunities for company managers and continuity lines in further studies in this field and in other areas.

Keywords: Strategic management, innovation, small and medium-sized enterprises, project design.

INTRODUCTION

Nowadays, the challenges of small and medium-sized enterprises are their continuity in the market, but depend on the abandonment of traditional management models and the adoption of modern management models that facilitate the introduction of new production technologies and customer loyalty in order to ensure their social, economic and environmental sustainability.

In the approaches on the innovation process, even if the attention is on the circulation of skills of the employees of organizations, where leadership must also be willing to the innovation process of the organization, having as its starting point the acceptance of internal organizational change to accept the introduction of new technologies in its internal processes.

In the scientific approach, the research brings opportunities to contribute and add theoretical and critical support to managers, owners of small and medium-sized enterprises and continuity lines in further studies in this field and in other areas.

Globally, small and medium-sized enterprises are seen as catalysts for the growth and socio-economic development of any country, given their contribution in income generation, direct and indirect jobs, mobilization of social and economic resources and promote economic competitiveness. There are several approaches to the design of organizational projects, but in Mozambique the study brings a new approach between the crossing of project design and the management of small and medium-sized enterprises to respond to current market challenges.

The work brings a design in the area of strategic management and project design in small and medium-sized enterprises, which is pointed out as a research game and the strategic plan is almost absent in the management of these Mozambican companies.

This article is structured in three sections, and this introductory note, development, final considerations and bibliographic references.

STRATEGIC BUSINESS MANAGEMENT

According to Dias (2018), strategic and thought schools are relevant elements in business management. (Table 1).

Table 1. Characteristic of strategic school training thinking school

School of Thought Contribution of each School in the process of formation of the Strategy
design Look to the near future, in search of a strategic perspective.
planning Look to the immediate future, to schedule the implementation of a defined strategy.
Positioning Look at the past within a defined horizon, whose analysis contributes to the formulation of the strategy.
entrepreneurship Look to the distant future in search of a unique vision.
cognitive The thought of the strategy formulator, which is at the center of the process.
learning Look at the detail, in search of the roots of the facts.
power Look for hidden spots within the organization.
cultural Look at the process, within the subjective perspectives of beliefs.
environmental Look at the process as a whole within the perspective of the environment.
configuration Look at the process more broadly, looking at all aspects.

Note. Contribution of each School to the strategy formation process. Data by Mintzberg and Lampel, (2019).

Carvalho (2013), emphasize that a competitive strategy is to choose from several opportunities within its field of activity to bring to a unique value formed with a strategic position. The position of the strategy can be made based on three different sources that are not reciprocal: different products and services, differentiated service, personalized and accessibility of customers.

From this point of view, strategic management functions as a set of deliberations and strategic achievements that indicate the performance of an organization over a long period of time, where background criticisms are made about the internal and external environments of the company, plotting, applying, evaluating and monitoring strategy.

SWOT analysis are very important elements for strategic management, because it brings a well-structured vision and the implications of its strategic clusters in strategy.

Ventura, Lima and Ventura (2018), adds the following: certain organizations achieve advantages in competition rationally, based on skills, organizational mechanisms, information and knowledge that facilitates the development of strategies that boost results.

Cavalcanti (2018), explains the following: to enter the market can be easier, because of information and communication technology and greater investment to improve production processes in order to have products in quantity and quality to compete with products already existing in the consumer market and are pointed out as some obstacles encountered by small and medium-sized enterprises. And to mitigate the negative effects of internationalization and seek solid foundations in the new market, small and medium-sized enterprises must identify and make strategic partnerships or memoranda for business development to solidify their structures and new challenges. In general, the main obstacles to the entry of organizations into world trade are: lack of financial resources, establishment of partnerships, knowledge of laws and processes, knowledge of the market, skilled labor, prospecting, expansion plan, marketing strategies, adapting products, and establishing base in foreigners.

BUSINESS MANAGEMENT

Lima and Santos (2019), several strategic activities aligned with the company’s business, guided by a policy of values with the ability to plan, manage and allocate in the best way their financial, human and installation resources. While management is a mechanism to plan, organize, lead and monitor the use of human, financial, technological and organizational physical structure to achieve the goals, efficiently and effectively.

The management of small and medium-sized enterprises are the result of their own characteristics: personality, informality and non-professional administration. The structure of small and medium-sized enterprises requires management that adapts to their obligations, objectives and resources that significantly impact performance and profit. This management is a great challenge for most companies, since most problems of small and medium-sized enterprises are explained by the lack of management capacity.

MANAGEMENT PROCESSES AND COMPETENCIES

Favoreto; Vieira and Ferreira (2019), in strategic business management, management processes and competencies are key elements of success, because they guided the construction and reconstruction of property to support operational processes in order to have a competitive advantage.

Lima and Maranhão (2020), state the following: the paradigm on competency management has as its fundamental objective to adjust the skills of employees to the company’s capabilities that are fundamental to the execution of the organization’s strategic plan.

STRATEGIC SERVICE MANAGEMENT

Marques; Moreira and Paverch (2020), there is a fundamental characteristic when we talk about services that lies in the quality of customer service that is one of the indicators on the degree of satisfaction. The organization must take care in the planning of the services to be provided to customers, in order to offer quality services for customer satisfaction. If companies meet the needs of their customers, they will have loyal customers and in turn such customers have made publicity about the products and services of a particular organization.

In general terms, strategic actions are those that ensure the continuity of the organizations’ business, create opportunities and relationships with competitors.

PERSONNEL MANAGEMENT

Regarding the characteristics and types of leadership, Silva (2018) understands that the subject requires a relationship with the business strategy, there being different types of leadership that can be applied, one to give greater freedom to employees (liberal, participatory and democratic leaders), and another in which leaders are focused on decision-making (autocratic leadership), having as the epicenter individuals or the development of tasks.

INNOVATION

Porto (2013), says that several companies are permanently inside looking for innovative initiatives of their employees. In the environment where the company is located there are favorable conditions to produce innovative initiatives. The thought of change does not appear in the time of creative enthusiasm, but rather the relevant ideas gain greater expression over time and after reaching their maturity gain their extreme importance in a certain way. Innovation is a mechanism that combines with varied knowledge. The different types of employee personalities within a company can impact on the process of designing innovative ideas tailored to the company’s current challenges, emphasizing the relevance in human resource management in generating innovation.

Silva et al. (2018) address that innovation is a remote issue that has been discussed in various socio-economic aspects. Innovation brings opportunities for existing products that have already lost their value, opening new markets or changing their structure, innovations often occur in a fostering way and bring significant improvements in the company’s business.When addressing the issue of small and medium-sized enterprises, fostering innovations have a fundamental function, motivated by the speed with which business owners easily add and apply.

Silva et al. (2018) stress that innovation is within the company and connected to the ability to find new and different ways of doing things, all this direction will give competence and ability to adjust the conditions for strategic development of the business. Innovation should be seen as a system that integrates all departments of the company. Therefore, there are two groups of factors (internal and external) that impact a company’s innovation process.

Pereira and Batista (2015), companies seek strategies, seek profits and sustainability, focus on technological innovation. The continuity of companies is due to the innovation process to gain competitive advantages.

The conservatives, say the following, according to Tigre (2014), issues related to competitive environment and the determination of prices of products and services, the neoclassical current does not take into account technological innovations to renew products and services. A new product is also a new market with its demand and supply. Thus the mechanism for determining the pricing of products and services is determined by product equality rule.This rule does not reflect realities today, so the law of competition is to display an aggressive act in advertising and different products.

CUSTOMER RELATIONSHIP

Lima and Maranhão (2020), state the following: the search for knowledge about the customer and the market facilitates understanding about the real needs of an organization, allowing the promotion of the innovative process and its consent in the supplier market and consumer market. The suggestions and knowledge that customers make arrive, from appropriate channels for customer service, are indicators of satisfaction and facilitate to select the real needs and provide differentiated products and services to customers.

The establishment of a relationship with customers is extremely relevant in fostering new thoughts and introducing products and services, organizational innovation process and organizational strategic thinking, nevertheless, it facilitates the identification of potentialities rationally and minimizing the negative impacts derived from the innovative process.

Lima and Maranhão (2020), affirm to better serve it is necessary to have in the company employees who have a notion about the relevance of this practice. Serving in an acceptable way is that it marks a difference between organizations, in general, every individual or client loves to have a wonderful, warm welcome and personalized treatment within a company and for this to happen employees must be well trained to acquire necessary skills in the field of customer service, because the success of a company depends largely on customer satisfaction. Employees submitted in a training section consolidate their skills and improve their performance in the tasks performed and the team spirit emerges.

From the point of view on quality in care, it relates to the efficient management of the company at the level of facilitation, creation and foster strategies and practices that aggregate the movements of quality care and a good training plan of employees.

SATISFACTION IN SERVICE

Marques; Moreira and Paverchi (2020), state that it is relevant that companies have the skills required by the market to take into account and realize the customer’s concern, so it is necessary to have quality in several sections such as: different products and services, mobility and merit in the forms of service.

Have a service to carry out an aid to show the services and quality products of the organization. The service process must be connected there is an efficient offer of products, services and a friendship establishment of the organization.

Therefore, quality in the form of customer service is a relevant tool for customer loyalty, fundamentally, for organizations seeking to acquire a privileged place in the face of their increasingly challenging consumer market competition. Therefore, fulfilling the customer’s desire is a critical factor of success for organizations becoming robust and developed in the market. And for this to happen, the organization needs to work hard and efficiently to better serve and meet the needs of the market where the organization is inserted.

SMALL AND MEDIUM ENTERPRISE

Ministry of Industry and Commerce (2016), small and medium-sized enterprises are in total about 2 427 609, where 37 696 legal entities belonged to entrepreneurs on individual behalf, equivalent to 65% of the business sector, with a contribution 21.7% of total invoicing and 30.3% of national employment. According to the criterion of number of employees, Mozambican companies qualify . Table 2.

Table 2. Summary of definition of small and medium-sized enterprises in Mozambique.

classification Number of workers Business Volume (MZN)
Microenterprise 1 – 4 < 1.200.000.00
Small business 5 – 49 1.200.000.00 ≤ 14.700.000.00
Medium enterprise 50 – 100 14.700.000.00 ≤ 29.970.000.00

note. Produced to explain the concept of PME, in the Mozambican context, data: M.I.C, 2016.

QUALITATIVE CHARACTERISTICS OF SMALL AND MEDIUM-SIZED MOZAMBICAN ENTERPRISES

M.I.C (2016), small and medium-sized enterprises: speed to challenge risks, agility in the consumer market and performance, the manager is both owner and makes decisions for the company, direct industrial relations. Influencing the company’s performance. There is a need to specialize the economies of small and medium-sized enterprises to gain an advantage in the competition of their business. Almost always, business owners do not have enough skills to increase necessary changes in the globalized world.

Small businesses suffer more from the system’s shortcomings compared to large enterprises. For medium-sized enterprises, some international experiences dictate the ability to know and guided with a consolidated macroeconomic policy and focused on stability and should be aided by the speed and adaptation of companies to the level of fortified and efficient facilities and authorities in the relationship between the private and public sectors.

The main policies of the State to assist small and medium-sized enterprises in the context of the new world order are as follows: cunning of fostering an industrial model, through the nuclei of small and medium-sized enterprises, facing the competitive environment. And the role of the State is to create a favorable business environment for the promotion, growth and development of companies.

INNOVATION IN SMALL AND MEDIUM ENTERPRISES

Silva et al. (2019) point out that many scholars approach innovation as an instrument of development and benefit of competition of small and medium-sized enterprises, are driven to innovate due to reduced business performance. Therefore, the inclination towards innovation is seen as a relevant competition strategy, due to the remarkable effect of the income of companies. The benefits of innovation of small and medium-sized enterprises are fundamentally behavior, combined with the movement of the company, internal speed in adapting to new challenges.

Teixeira; Dante and Barreto (2015), explain that it will be necessary a careful study of strategic planning in small and medium-sized enterprises with a business plan with the help of qualified employees. These authors point out some difficulties encountered by small and medium-sized enterprises, such as: lack of knowledge of all managers’ strategic planning processes in relation to large companies. And they point to the following obstacles: small and medium-sized enterprises cannot open many fronts at the same time, not to study and point to strategic actions to rationalize the varied organizational resources invested.

Strategic planning helps in the intervention of the strategy that sustains the business, draws problems with the help of qualified employees.

PROJECT DESIGN

Martins e Oliveira (2016) and Castro (2014), stress that project design and management is a relevant element to get out of the routine for the innovation process in organizations, because it brings methodologies for the organization to solve its problems in order to aggregate social and economic values.

Xavier (2014), the characteristics of project management are very important for the process of innovation in the products and services of organizations, according to the PMBOK® guide: Time management, cost management, quality management, human resources management, communications management, risk management, procurement management, integration management. And for this it will be necessary that there is general agreement that the correct application of these skills, tools and techniques can increase the chances of success in a wide range of different projects.

METHODOLOGY

DESCRIPTION OF THE STUDY AREA

Mozambique is situated in southwestern Africa, between the parallels 10º27′ and 26º52′ south latitude and between the meridians of 30º12′ and 40º51′ east longitude. It is bordered to the north by Tanzania, to the east by the Indian Ocean, west by Malawi, Zambia, Zimbabwe and Swaziland and to the south by the Republic of South Africa. The entire eastern coastal strip is bathed by the Indian Ocean. With 799,380 km2. With a population of about 30 832 244 inhabitants, with a population growth rate of 2.5%, the gross birth rate 37.6%, infant mortality rates of 67.4%, GDP growth rate of 2.28%.

According to Armindo (2013), the geographical physical characteristics described here are seen as alternative potentialities that to some extent can impact small and medium-sized enterprises in their socio- economic development, namely: tropical climate, soils, hydrography and fauna.

According to INE (2015), small and medium-sized enterprises are categorized into sectors of activities: primary, secondary and tertiary, namely: agriculture, animal production, hunting, forest, fishing, manufacturing, trade; repair of cars and motorcycles, accommodation, catering, tourism, provision of services and other services.

METHODOLOGICAL PROCEDURE

This article was based on exploratory research, which allowed the development of questions for interviews with private and public institutions, confederations of economic associations of inhambane province, small and medium-sized enterprises and the management of the operative area of the Mozambique tax authority of Inhambane respectively, as well as correlating different types of sources little publicized between project design with management practices in small and medium-sized enterprises in Mozambique.

The focus of this article was a qualitative and quantitative approach. Where the quantitative method allowed the identification of appropriate instruments for data collection, while with the qualitative method it was possible to analyze the data obtained in the field from the survey questionnaire, observation, interviews and documents.

In this article, participant observation allowed quick access of data on habitual situations, mission, vision, organizational culture, clarification on the profile of internal and external physical characteristics of small and medium-sized enterprises in the province of Inhambane. The semi-structured interview for the management and technical bodies of the operative area of the Tax Authority of Mozambique and the confederations of economic associations. Written documents, books, articles from indexed journals published on the object of the research. The bibliographic procedure served to describe the contributions of the various authors on topics related to the subject.

For this article, a simple casual probabilistic sample was chosen, working with 98 small and medium-sized enterprises, where they were represented by their respective managers or owners.

Data collection was carried out in the years 2019 to 2020 and followed three phases, i.e.: the first was during the month of March 2019, the second phase was carried out during the month of May 2019. (submissions of letters of applications for authorisations for data collection) and the third phase was carried out during the months of August, September and October of the year 2020 (testing and application of data collection instruments).

RESULTS

As for the sexual and age distribution of managers or owners of small and medium-sized enterprises. (Table 2)

Table 2. Sexual and age breakdown of managers.

Sex of the subject Total
male female
Age group 18 – 35 years old 17 2 19
36 – 59 years old 79 0 79
Total 96 2 98

Source: elaboration of the author.

As for academic level, gender and age group. Figure 1.

Figure 1. Distribution of gender, age group and academic degree of managers.

Source: elaboration of the author.

As for the time of service in the organization 65% are between 5 and 10 years old, 29% over 10 years and 6% have less than 5 years in the management of their organizations.

The organizational model demonstrates the relationship between leaders and leaders and their respective responsibilities. So we have companies with vertical and horizontal models.

In this work, 89.8% stated that there are organizational models applied in their management, 6.1% stated that they do not apply the models in management and 4.1% do not have knowledge about the models applied in management and that their management models are pre-bureaucratic – undifferentiated, 79.6% said they have, 13.3% do not know and 6.1% do not have it.

The model and strategic planning must be adjusted, the organization must have employees with leadership skills to achieve the expected goals. And for survival in the market organizations must bet on innovation for their products and services, thus suggesting the application of models by projects, networked and functional in order to be more competitive and remarkable globally.

As for leadership, small and medium-sized enterprises predominate democratic leadership with an average of 3.80%, liberal leadership 3.05% and autocratic leadership 2.60%.

As for the design of projects the average was 2.60, showing that they do not incorporate the project design in its management. In the theoretical design of the project design, it is the managers or owners with training in the areas of management, management and commerce and banking who have greater knowledge, with 3.9% and with lower notion are those of law and general education both with 3.4%.

As for the causes associated with the absence of project design in the management of small and medium-sized enterprises, human causes with an average of 4.1%, followed by technical causes with an average of 3.6 % and finally economic causes with an average of 3.4 %. (Table 3).

Table 3. Causes of the absence of project design in management.

N minimum maximum average Deviation Error
Technical causes in the absence of project design. 96 2.50 5.00 3.6198 0.60151
Human causes in the absence of project design. 98 3.00 5.00 4.0995 0.41669
Economic cause in the absence of project design. 97 1.00 5.00 3.4021 1.07684

Source: Author’s elaboration.

How many factors associated with the bankruptcy of small and medium enterprises are: political factors with an average of 4.41%, human factors with an average of 4.08%, technical factors with an average of 3.96 % and finally economic factors with an average of 3.90%. (Table 4).

Table 4. Associated factors in the bankruptcy of small and medium-sized enterprises.

N minimum maximum average Deviation Error
Technical factors influencing the bankruptcy of small and medium-sized enterprises in Inhambane. 98 3 5 3.96 0.419
Human factors influencing the bankruptcy of small and medium-sized enterprises in Inhambane. 98 3 5 4.08 0.386
Economic factors influencing the bankruptcy of small and medium-sized enterprises in Inhambane. 97 1 5 3.90 0.963
Political factors influencing the bankruptcy of small and medium-sized enterprises in Inhambane. 97 2 5 4.41 0.515

Source: Author’s elaboration.

FINAL CONSIDERATIONS

The purpose of this article was to study the factors that are associated with the absence of a project design for the improvement in the management of small and medium-sized enterprises in Mozambique. From this point of view, the interaction determined a model that should be taken into account by the leaders of organizations. The research confirms the related subjects of the literature review on the advantages of strategic management and project design.

The paper concludes the following: there are three groups of associated factors that determine the absence of project design and bankruptcies of small and medium-sized enterprises: human factors, economic factors, technical and political factors.

Small and medium-sized enterprises do not include design design for improvement in their management processes.

In the strategic vision of the organization, the leader is an agent that is a dynamic agent of organizational changes to achieve organizational objectives and communication is fundamental to the survival of the organization.

To ensure the survival of organizations in the market should focus on the innovation of their products and services. Application of flexible structures for the market, such as structure by projects, networked and functional. In this way the work recommends that these points that have been raised are one of the many that deserve attention from managers or owners of small and medium enterprises.

Regarding limitations, the interview technique, being a conversation between the researcher and the subject, the research at some point was misunderstood by the lacunosa interpretation of the subjects and as a solution the researcher had to explain thoroughly and orally about the objectives of the research that were merely for academic purposes and would be treated the data obtained by the participants in a confidential manner.

Data collection and filling out was at some point subjective and it was noticed that most subjects did not understand the question. Some questions were not answered. Difficulty in having access to data with managers of small and medium-sized enterprises and public institutions.

The work brings a design in the area of strategic business management, innovation and design of well-structured projects for small and medium-sized enterprises. Encouraging the innovation of its products and services and the application of flexible structures that ensure the survival of companies in the market.

The research brings contribution and opportunities for managers of small and medium-sized enterprises in general and in particular for Mozambicans and continuity lines in further studies in this field and in other areas.

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[1] Master’s degree in human resources management from Piaget University of Mozambique, professor, analyst, trainer and human resources consultant, PhD student in business management from UNINI – Mexico.

[2] PhD in agriculture from the Autonomous University of Yucatán.

Submitted: April, 2021.

Approved: April, 2021.

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