Impact of Employee Training on Firm Performance in Small and Medium Enterprises

Impact of Employee Training on Firm Performance in Small and Medium Enterprises

Companies today are forced to function in a world full of change and complexity, and it is more important than ever to have the right employees in order to survive the surrounding competition. This study aims to exploring and understanding dimensions of employee training program on job satisfaction in Pakistan, Like Small and Medium Enterprises. As the primary focus of the study is on exploration so the proposed study will use sequential exploratory design based on the

mixed method approach in which first phase is qualitative in, HRM Practices and job satisfaction whereas the second phase is quantitative.

Introduction and Background
Over the past one and half decades, various arguments have been made that firm’s human resource may be its sole source of sustainable competitive advantage (Ferris et al, 1999). We extend this idea by arguing that if innovation is the education and, especially, training is the ammunition that renders it useful and effective. Research indicate that inadequate and inefficient management of employee in small firms has resulted in low productivity and high turn over rate
and one of the leading causes of small firm failures (Mc Evoy, 1984). The resource based approach contends that organizations can develop a sustained competitive advantage only if its activities create value in a unique way, one that competitors cannot easily copy (Barney, 1991; 1995).Employee Training Program increase performance of both organization & individuals. This study will address one specific aspect of human resource management, training, to see if the
presence and type of training offered by Pakistan SMEs impact operations and profitability.

Purpose Statement
This Proposal is designed for the purpose of investigate the impact of training on firm performance for registered, private, manufacturing SMEs. No studies currently exist on the relationship between SME firm performance and employee training practices in Pakistan. The results of this study should help Pakistani managers determine whether tight financial resources should be expended on training programs or if the funds could be better utilized elsewhere within the company.

The aim of the study is implementing HRM practices like Training Program in Small and Medium Enterprises for the purpose of employee’s development as well as firm performance. Therefore, purpose of this two phase, sequential mixed methods study will be, to explore viewpoint about Training Program and performance of the firm using Semi-structured interview. This will be better to understand a research problem by converging both quantitative and
qualitative data.

The main objective is to increase the understanding regarding employee’s training and development in relation to firm's performance.

 To explore the importance of employees training program in small and medium enterprises and see as good, bad or acceptable performance.
 To explore the perception of employers in small and medium enterprises about the training program.
 To explore the employee training contributes to their performance. To explore why training is important for employees and firm performance.

The present study will be significant in number of ways. It will contribute to the body of knowledge by:
1. firstly, since the present area is highly under researched. No study has been found to explore the employees training in Small and Medium Enterprises. Therefore, the present study assumes that the findings of the present study will help in implementing that study in SMEs Sector and those in developing countries in general to answer the long standing question of how to enhance employee and firm performance.
2. Secondly, no research has been found on employee training and firm performance in Small and Medium Enterprises. Therefore, the present study will prove to be a significant contribution in this area with the assumption that employee training program is important for the individual and firm over all performance. Employing mix methods research which has not been used in this area and hence this will be a significant methodological advancement.
3. Examining the applicability of the discussed Western concepts and theories in an Eastern developing country in order to develop of these concepts.

Question
For the first phase which is qualitative in nature following are the proposed research questions.

(Main question)
Impact of Employees Training on Firm Performance in Small and Medium Enterprises
(Sub questions)
1. What are the employee experiences about relevant training and development program and how they feel about that?
2. How do employees perceive about their own performance and what they perceive as good, bad or acceptable performance?
3. What are the employee’s opinions about firm that contribute to their performance? In a two-phase, sequential study in which second phase (quantitative) depends on the result of the first phase (qualitative), it is difficult to specify the questions asked in second phase at the time of proposal writing.