Abstract:
The main purpose of conducting this study was to investigate quality management practices
and business performance of SME in merhabete/Alemketema. Four key dimensions of quality
management practices such as customer focus, human resource focus, supplier quality
management and continuous improvements were used as independent variables accompanied
by different measurement instruments under each variable, while non-financial performance
variable was used to measure the business performance. The study used primary data which
was collected using self-administered questionnaires from a sample of 245 employees, 230
were correctly filled and returned, an overall response rate of (93.87 %). Data was analysed
using descriptive and econometrics analysis. The results were presented using tables, graph.
The findings indicate that continuous improvement, customer focus, human resource focus
and supplier quality management had positive and significant effect on performance of SME.
The study recommended that the SME should ensure that the objectives of the organization
are linked to customer needs and expectation to improve performance, employees with the
required resources and they should allow participative and engagement of employees in
making decisions on quality issues and provide freedom to act with responsibility and
accountability. Additionally, the study recommended that through continuous improvement so
as to improve performance, the company should focus on training, system measurement,
benchmarking, and internal quality audit. Finally, the study recommends that similar
research can be conducted focusing on additional variables that affect performance of SME
and other small scale enterprises like service, trade and agriculture and also financial
performance was not addressed in this research and it could be addressed by future research.
