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SMEs strategic management: A Comparison between the Saudi Arabia and UK

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According to Sharma (2011), SMEs design their strategies five elements that include competitors’, resources, market and environment interactions as well as planned activity. Typically of SMEs in Saudi Arabia and the UK, these strategies are designed to enter industries that are already dominated by large corporate organisations. However, in Saudi Arabia, SMEs face challenges as commercial banks and most financial institutions are sceptical about funding them (Glaister, Dincer & Tatoglu, 2010). In view of this and acknowledging the potential of SMEs to drive the economy, the Saudi government collaborated with other firms in the private sector to provide support such as business training to improve management.

In their own organisational structures, the SMEs in Saudi Arabia are relatively poor in management and business planning compared to their counterparts in the UK because they do not fully explore knowledge management strategies (Riyadh Chamber of Commerce & Industry, 2011). Further findings indicate that SMEs in Saudi Arabia do not align their business strategies with information technology (IT) strategies to the extent observed in the UK. However, it is worth mentioning that the leadership skills and management levels in SMEs in the UK are holding back general growth.

A study by the Warwick Business School identified insufficient entrepreneurial skills as the key factor that hampers growth among UK SMEs (Glaister, Dincer & Tatoglu, 2010). The purpose of this research is to explore the SME strategic management in Saudi Arabia and compare it to the practice in the UK. Saudi Arabia’s oil-based economy has a global impact and is by far the Middle East’s largest economy (Ahmad, 2014). Although oil revenues dominate government and export earnings, there is a large number of SMEs that significantly impacts the local and foreign economy.

It is with this understanding that strategic management is perceived as a crucial pillar in ensuring corporate survival and is applicable in ensuring better SME performance. Essentially, strategic management is used to create competitive advantage and position an organisation better that competing entities. Whether from the perspective of developing or developed countries, SMEs play crucial roles in the health of the economy. Although each country and economic region or grouping has its own unique attributes, SMEs generally represent up to

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