Dissertation: Analyzing Small and Medium Size Firms in Tobago

This dissertation provides a critical analysis of small and medium size enterprises (SMEs) in Tobago, exploring their contribution to the local economy and the challenges they face. The research investigates the organizational culture, governmental support, and internal forces affecting SME performance through both primary and secondary data analysis. Findings reveal that while SMEs in Tobago are experiencing growth, internal structures, employee motivation, and leadership styles require improvement. The study uses questionnaires and interviews to gather insights from managers and employees, highlighting the need for a more supportive organizational culture and better employee benefits. Ultimately, the dissertation offers recommendations for enhancing the business environment for SMEs in Tobago, contributing to the understanding of their role in the region's economic development, and this valuable resource is available for review and download on Desklib, along with numerous other solved assignments and research papers.

Running head: DISSERTATION
A critical analysis of small and medium size firms in Tobago
Name of the Student
Name of the University
Author’s Note

1DISSERTATION
Abstract
This research project is performed on the small and medium size organizations located in
Tobago. The major purpose of the research is to derive a useful insight about how the small
and medium size firms perform in a recently growing market environment. The introductory
chapter of the research provides the idea that small and medium size firms in Tobago have
recently observed a rapid growth due to arrival of foreign investors, economy and
government initiatives toward the development of SMEs (Small and Medium Enterprise) in
Tobago. The review of existing papers help to observe that even though the small and
medium size firms in Tobago are on the edge of development, the employers are not much
concerned about the incorporation of corporate culture and growth due to limited workforce.
This means that labour crisis in the regional environment is creating a strong influence on the
small and medium size organizations. In addition, the existing literature also provides the fact
that SMEs in Tobago usually have a family based culture, where each member is treated like
a family person who take an equal amount of responsibilities and have equal contribution to
task accomplishment. Both primary and secondary analysis have been performed in the
research. Primary data have been collected from books, and journal articles while the
secondary data have been collected by performing an interview among the employees and
managers of small and medium size firms in Tobago. Non-probability sampling method has
been applied to choose the respondents and sample size for the interview is 5 managers and
50 employees of small and medium size organisations in Tobago. The findings indicate that
even though SMEs in Tobago receive a sudden growth but the internal structure of small
businesses are not in place. Employees in such small businesses lack motivation due to lack
of monetary and non-monetary benefits. Due to ineffective leadership style, employee growth
is limited. The findings indicate employees demand an organizational culture where they can
openly discuss their workplace and personal issues with supervisors and managers.

2DISSERTATION
Table of Content
CHAPTER 1: INTRODUCTION..............................................................................................7
1.1 Introduction..........................................................................................................................7
1.1.1 SMEs contribution........................................................................................................7
1.1.2 Governmental back up to SMEs in Tobago..................................................................8
1.2 Research Rationale...............................................................................................................8
1.3 Research Aim and Objectives..............................................................................................9
1.4 Research Questions..............................................................................................................9
1.5 Research Scope....................................................................................................................9
1.6 Outlines of the following chapter.......................................................................................10
1.6.1 Chapter 2: Literature Review......................................................................................10
1.6.2 Chapter 3: Research Methodology..............................................................................10
1.6.3 Chapter 4: Findings and Analysis...............................................................................10
1.6.4: Conclusion and Recommendation.............................................................................10
2.0 Introduction........................................................................................................................11
2.1 Organizational culture of SMEs in Tobago.......................................................................11
2.2 Government’s initiatives in backing the SMEs in Tobago................................................12
2.3 Larger access to Finance....................................................................................................13
2.4 Impact of small business enterprises on the economy.......................................................14
2.5 GDP/Revenue/Value Added..............................................................................................15
2.6 Nation’s strategies to enhance the business environment..................................................17
2.7 Impact of the internal forces on business performance of SME........................................18

3DISSERTATION
2.8 Gap Analysis......................................................................................................................22
CHAPTER 3: RESEARCH METHODOLOGY.....................................................................23
3.1. Research Philosophy.........................................................................................................23
3.2. Research Onion.................................................................................................................23
3.3. Research Methodology......................................................................................................24
3.4. Research Approach...........................................................................................................24
3.5. Positivism..........................................................................................................................25
3.6. Realism..............................................................................................................................25
3.7. Interpretive........................................................................................................................26
3.8. Pragmatism........................................................................................................................26
3.9. Data Collection Methods...................................................................................................27
3.10. Research Strategy............................................................................................................27
3.11. Research Choices............................................................................................................28
3.12. Questionnaire Development Process...........................................................................28
3.13. Sampling Theory.........................................................................................................29
3.14. Interviews....................................................................................................................29
3.15. Questionnaires.............................................................................................................29
CHAPTER 4: FINDINGS AND ANALYSIS.........................................................................31
4.1 Introduction........................................................................................................................31
4.2 Data findings and analysis.................................................................................................31
1.3 Questionnaire for Employees........................................................................................37

4DISSERTATION
CHAPTER 5: CONCLUSION AND RECOMMENDATION................................................44
5.0 Conclusion..........................................................................................................................44
5.1 Linking objectives with the literature and primary data....................................................44
5.2 Recommendations..............................................................................................................47
5.3 Limitation...........................................................................................................................48
5.4 Future scope of the study...................................................................................................48
References................................................................................................................................49
Appendices...............................................................................................................................55
Interview Questions for the Managers.................................................................................55
Questionnaire for Employees...............................................................................................55
Quantitative Data (Transcript).............................................................................................59
Transcript (Qualitative Data)...............................................................................................66

5DISSERTATION
List of Table
Table 1: Leadership initiatives in the cottage industry............................................................19
Table 2: Organizational culture contributing to performance improvement...........................21
Table 3: Leaders’ initiatives motivating in employees............................................................23
Table 4: Motivational factors...................................................................................................25

6DISSERTATION
List of Graphs
Graph 1: Influence of functional elements on business...........................................................40
Graph 2: Leadership initiatives in the cottage industry...........................................................41
Graph 3: Organizational culture contributing to performance improvement...........................42
Graph 4: Leaders’ initiatives motivating in employees...........................................................44
Graph 5: Motivational factors..................................................................................................46

7DISSERTATION
Topic- A critical analysis of small and medium size firms in Tobago
CHAPTER 1: INTRODUCTION
1.1 Introduction
This research project provides a detailed analysis of small and medium size firms in Tobago
by justifying author’s interest in whether small and medium size firms contribute to trading
and business in Tobago. The chapter defines aims and objectives are clearly stated in the
chapter to give an idea about how the research is conducted and which areas are particularly
analysed.
Small and medium size enterprises fall under the category of rapidly growing businesses
providing maximum work opportunity to nation’s citizens (Duval and Utoktham 2014). Large
MNCs are usually not high in number due to unstable and slow economy but small and
medium size firms under a limited financial capital find it convenient to operate business in
Tobago (Bahaw 2017). Thus, it is highly necessary to perform a research on how SMEs have
become a backbone of Tobago’s GDP and trading.
1.1.1 SMEs contribution
Trinidad and Tobago introduces initiatives to secure funding for small and medium
size enterprises by contributing a significant percentage to GDP as well as providing work for
a large part of the workforce. As per the T&T Chamber of Industry and Commerce (TTCIC),
there were above 20,000 SMEs running operation in the nation as of 2012. Ramkissoon-
Babwah (2012) mentioned that a small business in Tobago and Trinidad is defined as having
a staff 6 and 25 employees and sales up to TT$5m to TT$ ($770,000), but a medium size
enterprise in Tobago has 26-50 employees and sales up to TT$10m ($1.5m) (Lewis, Pun and
Lalla, 2005). On the basis of such criteria, the Central Statistics Office anticipates that above
80% of all registered business in the nation are SMEs. However, it is also identified that even

8DISSERTATION
though SMEs contribute a lot to the GDP of T&T, small and medium size firms do not have
much influence on the economy because the economy is mainly dominated by petroleum
businesses (Lewis and Jordan 2008).
1.1.2 Governmental back up to SMEs in Tobago
The recently formed government in Tobago has vowed to enhance the support for
SMEs. The Ministry of Finance particularly noted that SMEs have been generating a
significant proportion of new employment opportunities in the nation and that remain
attractive to the new generation who are interested in innovation and Information
Technology. Nonetheless, Lashley (2016) commented that as SMEs often suffer from lack of
financial support and training and the government mentioned that it would ensure appropriate
funding for the state institutions such as the National Enterprise Development Company
(NEDCO) and this institution is mainly responsible for promoting an entrepreneurial culture
among the youth of the nation (Ngoasong 2014). In addition, it has also been identified that
the government is also continuing the Fair Share program and designed to give micro
enterprise as well as cooperative access to public procurement opportunities. Artana et al.
(2007) mentioned that governments departments are required to create small business
platform designed to encourage SME involvement.
PESTLE analysis
Political: Due to persistent governmental initiatives towards the growth and development of
Small and medium size firms, Tobago is enjoying a challenge-free trading environment
barring the political stand aside (Işcan,. Ersarı and Naktiyok 2014). The country is more after
the freedom of civilians; thereby, the number of entrepreneurs is increasing in the nation with
their small and start-up businesses.

9DISSERTATION
Economic: International Monetary Fund (IMF) Tobago’s nominal GDP is considered to
increase at a CAGR of 3.8% from its 2015 level of TTD 150.247 billion and reach TDD
195.033 billion 2022 (Kaya and Koch 2015). Due to the entry of foreign investors and
development of small firm like Digicel, the economy in Tobago is healing faster than the
status recorded in the last decade.
Social: As put forward by Krausmann, Richter and Eisenmenger (2014), Tobago is widely
known as the home of lively living, with the carnivals, steel bands. In addition, the island lies
close to coast of Venezuela which attracts many foreigners and the nation lives with an
advanced and mixed culture.
Technology: When it comes to technology, it is worth mentioning that Tobago had
progressed a lot. Due to entry of small and medium size business, the technology is rapidly
being used (Bahaw 2017). This is because; the small and medium size firms adopt technology
to cut their operation cost such as labour cost and reach the mass audience.
Legal: Being an emerging nation with respect to trading, Tobago is much concerned about
the trading regulation such as Public Private Partnership 2006 (PPP) states that
implementation and Regulation must prescribe the framework and the parameters under
which the private partnership could operate (Belias and Koustelios 2014).
Environmental: Tobago is famous for its greenery and Tobago has some largely wooded
areas which include a protected rainforest and beaches (Bamiatzi and Kirchmaier 2014). The
government of the nation is highly concerned about the environmental resources.
SWOT analysis
Strength
 Tobago’s GDP is supposed to grow
at a CAGR of 3.8% by 2022 (Kaya
Weaknesses
 Not all Tobago is striving
economically; there is a large gap

10DISSERTATION
and Koch 2015)
 Unemployment rate is only 4.1%
 Tobago has estimated population of
1.37 million in the year 2016 which
is supposed to increase and it
increases the workforce capacity of
the nation (Bamiatzi and Kirchmaier
2014)
which separates the wealthy and
poor
 Tobago is surrounded by crimes
caused by drug trafficking
 High salary cost compared to Latin
America, Colombia which could
prevent IT firms who are seeking
cost arbitrage
Opportunities
 Tobago has developed its trading
relationship with the United
Kingdom and the country is looking
forward to expand its trade
relationship with developing nations
like the United State and China
(Artana et al. 2007)
 The local ITO sector (Information
Technology Outsourcing) is small
but they are able to deliver high
value ITO services to the global
nations
 Local universities in Tobago have
raised the voice for ITeS sectors by
designing and providing focused
Threats
 The foreign trades in Tobago often
gets into trouble due to regional
pirated groups who attack the supply
chain network of goods carrying
through the sea. Such incident often
leads to killing. Consequently,
foreign labours usually do not step
to Tobago (Bahaw 2017)
 As some social factors such as
sustainability, diversity, healthcare
and fair taxation being imposed by
the government as well as lobbied
into significant terms for large
corporations, the small and medium
size firms are getting choked

11DISSERTATION
courses and they ensure a
sustainable talent pool. This is a
significant opportunity for SMEs as
they can rely on the regional labours
instead of investing in the global
talent
(Lashley (2016).
 Large corporations and the
governments tend to hire third party
sourcing agencies, whose purpose is
to minimize the power of small
business vendors and commoditize
their products and services. This is
because the large corporation is able
to increase the rate of GDP
Framework 1: SWOT
1.2 Research Rationale
The current state of trading in Tobago implies that SMEs are rapidly growing and
contributing a significant percentage to the GDP. Even though the other sector such as Food
and Beverage and Information Technology industry are playing a great role in creating
work opportunity for the people in Tobago, SMEs are not lagging behind whatsoever, as
overall contribution of SMEs to GDP is significantly high (Grazzi et al. 2016). This finding
creates the significance of performing a research on this context. Moreover, the study helps to
learn how small and medium size businesses are going to help Tobago in enhancing or
creating a healthy balance in the economy. The following are some of the major areas can be
derived from the research:
 Overall Contribution to nation’s GDP
 Type of work opportunities generated by SMEs
 Future scope for business in Tobago
 Government’s initiative to sustain SMEs