Stake Holder Participation, Commitment and SME Performance in Kampala District, Uganda.
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Date
2025-07-31
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Makerere University Business School
Abstract
This study examined the relationship between stakeholder participation, stakeholder commitment, and the performance of Small and Medium Enterprises (SMEs) in Kampala District, Uganda. SMEs play a crucial role in Uganda’s economy by contributing significantly to employment and GDP. However, many face persistent performance challenges, particularly in profitability, growth, and sales. Guided by Stakeholder Theory (Freeman, 1984), the study adopted a cross-sectional research design and relied on a structured, self-administered questionnaire to collect primary data from 379 SMEs selected through stratified and purposive sampling techniques. Data analysis was conducted using SPSS Version 20, employing descriptive, correlation, and regression techniques. The results revealed that both stakeholder participation and commitment significantly influence SME performance, with stakeholder commitment showing a stronger predictive effect. The combined model explained 28.1% of the variance in performance outcomes. The study recommends that SME managers actively engage stakeholders in decision-making and cultivate affective, normative, and continuance commitment to enhance trust, loyalty, and performance. Furthermore, government agencies such as the Ministry of Trade, Industry and Cooperatives and the Uganda Investment Authority (UIA), as well as organizations like Enterprise Uganda and the Private Sector Foundation Uganda (PSFU), are urged to support stakeholder-inclusive governance through policy incentives and targeted capacity building. The findings contribute to both academic and policy discussions by addressing empirical and theoretical gaps, offering practical strategies for enhancing SME sustainability in Uganda.
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This is a master’s thesis
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Citation
Nanziri, L. C. (2024). Stake Holder Participation, Commitment and SME Performance in Kampala District, Uganda. Makerere University Business School.