We are all aware that microenterprises are important for the industrial development of any country, especially countries which have abundant labor resources. The role played by these microenterprises in countries such as India is immense as they are effective tools for sustainable livelihood, employment generation and empowerment of women, besides contributing to the country’s GDP and social upliftment. In the first paper, “A Framework for the Development and Success of Microenterprises in India”, the authors, Debanjan Nag and Niladri Das, attempt to put together a framework necessary for the development and success of microenterprises in India by identifying two broad dimensions from literature—individual and business factors. The authors, through the framework, convey that decisions related to microenterprises at the planning and policy implementation level must incorporate these dimensions and sub-dimensions. Doing so will ensure that these enterprises develop and accomplish the purpose for which they are established. According to the authors, since this is the first study in the Indian context, more variables can be incorporated in future studies and relationships can be empirically tested.

The second paper, “The Impact of Regulations on Microfinance Industry: A Strategic Perspective”, by Debapratim Purkayastha, Trilochan Tripathy and Biswajit Das, concerns Microfinance Institutions (MFIs). We are aware that MFIs promise poverty alleviation while being sustainable. However, in recent years the idea of microfinance has been questioned. Also, the study of MFIs or their business environment from a strategic management perspective has not been taken up. For instance, empirical evidence suggests that MFIs face a tradeoff between profitability (financial sustainability) and outreach (reaching the poorest customers). Therefore, a study of the ecosystem of MFIs from a strategic perspective would also be of interest to other stakeholders such as donors, investors, banks and government. This paper attempts to approach the issue of regulatory impact on the microfinance industry from a strategic management perspective. The discussion in this paper entails a literature review that shows the importance of the industry and the regulatory effects on a firm; it then looks at some of the tradeoffs faced by MFIs, followed by a summary of literature on regulations of MFIs.

The third paper, “Pursuing Eco-Innovation Within Southeastern European Clusters”, by Jana Hojnik, Mitja Ruzzier and Aleš Lipnik, pertains to Eco-Innovations (EI) and how they benefit the environment. Implementing a strategy of EI leads to the creation of competitive advantage, has positive effects on eco-efficiency, helps expand companies into foreign markets and enhances export performance. Besides, investments in EI also help in improving company reputation and financial performance. This paper analyzes the strategy of EI being organized in eleven clusters belonging to the South Eastern European (SEE) region. Although the study does not try to establish linkages to specific performance variables and EI strategy, it does help build a platform to encourage discussion on this very important area of EI management in clusters. The key results of the study indicate that a majority of the activities regarding EI (awareness-raising, distribution of information, training and initiation of/participation in eco-R&D projects) are positively and statistically correlated to cluster’s primary focus on EI.

The last paper, “A Profile of Malaysian International Small and Medium Enterprises: Mapping Current Performance on National Policies and Strategic Objectives”, by Mohd. Najib Saad and Aida Idris, looks at the process of internationalization of Malaysian companies. In Malaysia, there have been numerous policies, strategies and support programs formulated by the government aimed at fostering the development and internationalization of Small and Medium Enterprises (SMEs). This paper analyzes the Malaysian government’s policies on business internationalization and tries to derive a profile of its international SMEs, with the aim of evaluating the effectiveness of these policies in developing firm competitiveness in international markets. The findings reveal that Malaysian SMEs are still at their early phase of involvement in international business with a low representation in international markets and low sales and profits derived from internationalization, despite numerous policies, strategies and programs supporting their internationalization development. This suggests that the present policies and strategies concerning SMEs’ internationalization require urgent reviews and revisions to better suit their needs in the ever changing global environment. The policy makers are also advised to consider the relevance of various regulations which hamper the growth of SMEs at the international level.

-- Venu Gopal Rao
Consulting Editor