The perceived impact of agency control on the performance of Zimbabwean small-to-medium enterprises

Abstract

Background: Agency control has been studied in the context of large public listed businesses and is linked to business performance. However, very limited studies have validated such a role in small-to-medium enterprises (SMEs), especially in a developing economy.

Aim: The current study aimed at ezstablishing the perceived impact of agency control on performance, as measured by return on investment (ROI) and innovation in SMEs in Harare Province, Zimbabwe.

Setting: Primary research was conducted amongst owners or managers of SMEs in Harare Province, Zimbabwe.

Methods: The final sample consisted of 106 owners or managers of SMEs. The study was purely quantitative and adopted the survey design. Structured questionnaires were used for data collection.

Results: The study established that the most used control mechanisms were frequent monitoring and face-to-face deliberations with subordinates. Weak and statistically insignificant relationships were found to exist between agency control and business performance measured by both ROI and innovation.

Conclusion: It is best to solicit expert advice to coach owners or managers on how best agency control mechanisms could be formally instituted and managed to leverage on them.