DEVELOPING THE SCALE FOR MEASURING SMES’ PERFORMANCE IN TIMES OF CRISIS
Abstract
The aim of the study is to develop the scales for measuring SMEs’ performance in times of crisis. To achieve the goal, we analyzed the definition of resilience of business that face adverse situations and circumstances in times of crisis. In addition, a comprehensive review of the literature on measuring business performance, validity and reliability of relevant scales was carried out. Based on the previous researches, we made the conclusion that business performance could be evaluated with financial and non-financial indicators. Recent scientific developments cover the concepts of sustainable business performance and the appropriate measurement scales that contribute to non-financial measurements. Additionally, being a multidimensional construct, business performance has been used as a subjective as well as an objective measure. In a practical sense, subjective approach suggests that financial and non-financial indicators are evaluated from entrepreneurs’ perspectives and expectations. We identified that subjective approach is more appropriate for studies on SMEs’ performance. More frequently, researchers do not have necessary objective data on business performance. Thus, we used the subjective approach in our study to develop and test the scales for measuring financial and non-financial performance of SMEs, established in previous studies. In confirming the measurement models, we used the exploratory factor analysis, the confirmatory factor analysis and the goodness-of-fit statistics. The data was collected through the survey from 212 Ukrainian entrepreneurs in April-June 2024 and represents a self-reflection of entrepreneurs on “objective” indicators and outcomes. We employed SPSS 27 for exploratory factor analysis, as well as structural equation modelling (SEM) using the AMOS program. We identified that the scale of non-financial performance, established in previous studies, is not reliable and valid for further analysis in Ukrainian context and has to be developed and improved. However, financial dimension of business performance is suitable for use in future SME-related research based on structural equation modeling.
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