Managerial Competencies, Employee Motivation And Perfomance Of Small And Medium Size Enterprises (Smes) In Kampala Central Division

Abstract

The study intended to assess the relationship between managerial competencies, employee motivation and performance of Small & Medium Scale Enterprises (SMEs) in Kampala Central Division. The specific objectives of the study were; to examine the relationship between managerial competencies and performance of SMEs in Kampala Central Division, to investigate the relationship between employee motivation and performance of SMEs in Kampala Central Division and to study the factor structure of managerial competencies and employee motivation on performance of SMEs in Kampala Central Division. The study adopted used cross-sectional research design. Quantitative and qualitative approaches were used. Slovin’s Formula was used to determine a sample size of 109 from the whole population of 150 staff of the selected SMEs. Purposive sampling and convenience sampling were used to select the respondents and data was analysed using IBM, SPSS and data was presented using descriptive and inferential statistical results. The study established managerial competencies positively affected performance of SMEs (Pearson correlation of .635 and P-value < 0.01). Employee motivation positively affected performance of SMEs (Pearson correlation of .599 and P-value < 0.01). 58% of SMEs’ performance was explained by used predictor variables, which implied that managerial competencies and employee motivation greatly influence the performance. Managerial competencies predicted more of performance of SMEs with 0.463, followed by employee motivation with .344. The study concludes that it was concluded that there was a significant positive relationship between managerial competencies and performance of SMEs, an increase in employee motivation resulted into improved performance of SMEs. The study concluded that performance of SMEs’ performance was explained by used predictor variables, which implied that managerial competencies and employee motivation greatly influence the performance. The study recommends that there should be some effort channeled towards ensuring that competent staff is hired in the SMEs and ensure that their competences especially their skills and knowledge are improved while in the businesses since they proved to be the most determinant for management competences, should seek to improve on the remuneration, reward, recognition and job security terms in place so as to significantly drive workers’ performance. SMEs in Uganda should encourage individuals’ need to have a wide range of competences in order to face the complex challenges of today’s world, but it would be of limited practical value to produce very long lists of everything that they may need to be able to do in various contexts at some point in their lives. Further research can be conducted in other SMEs of other regions of Uganda so as to have an overall picture on the relationship between managerial competencies, employee motivation and performance of SMEs and compare recruitment and job evaluation and their effects on performance of SMEs in Uganda.