Towards developing better employee accountability in SMEs

Abstract

Accountability in organisations has increasingly been linked to organisational performance. As the success of Small and Medium Sized Enterprises (SMEs) has been proven to be a key driver for economic development and the creation of jobs in developed and developing economies, understanding the factors that impact the viability and sustainability of SMEs becomes incredibly important.While accountability in large organisations has been researched more frequently, little is known how SMEs are able to develop employee accountability within their organisations. Factors that influence accountability in large organisations may differ in the context of SMEs given the high informality in employee management that is found in SMEs and not large organisations. The purpose of this study is to understand what is considered to be influential in developing employee accountability in SMEs. A qualitative research approach was adopted with fourteen owners of established SMEs employing between 5 and 200 employees. Leadership style and organizational culture were argued to be critical for the survival of SMEs. It was found that the owner is the source of accountability systems that are created in the organisation as the owner has major influence in determining the levels of formality and informality in the organisation. In addition, the values of the company such as transparency, trust and the sharing of information, as well as formal systems such as reward structures, performance reviews, and ongoing feedback, were found to be essential in developing employee accountability. Employee accountability ultimately is the outcome of the owner being accountable to both the employees and the company. The study has implications for owners of SMEs as the type of exchanges between employer and employee highly correlate with the employeeÕs accountability.