Critical Issues in Managing Small and Medium Enterprises: The Nigerian Experience

Abstract

There is no gain in saying that Small and Medium Enterprises (SMEs) are widely acknowledged as important organizations that contribute to the socioeconomic growth and development of nations. In developed countries, these enterprises are well managed. However, in Nigeria, managing SMEs is dissected with a number of critical issues that militate against their effectiveness, efficiency, profitable operations and so need urgent attention. The paper reviews the strategies that can best be applied in managing SMEs to make them more effective, efficient and profitable. The works and findings from experts in SMEs: Drucker, Porter, Davida et al., Armstrong, Cummings & Worley and others were used to draw conclusions and advance a case for the Nigerian businessmen and entrepreneurs. Literature findings indicated a number of strategic options that are available to the owners of SMEs in areas of competition, growth, cost containment, customer relationship, change management, attracting, training, and employees, innovation, access to capital and insecurity (Boko Haram, kidnapping, corruption, political upheavals and child trafficking). The paper suggests that if these strategies are effectively implemented, SMEs would be in a better position to compete, grow and innovate, be cost effective, retain and motivate employees, relate better with customers, manage change without much conflict and continue to contribute to the socioeconomic development of Nigeria. Further research can be conducted in comparative analysis of SMEs in the manufacturing and agricultural sectors of the Nigerian economy.