IDEAS home Printed from https://ideas.repec.org/a/bcp/journl/v5y2021i08p459-466.html
   My bibliography  Save this article

Organizational Capabilities that Can Improve Profitability of Micro-Finance Institutions in Periods of Economic Crisis. Experiences from the Zimbabwe

Author

Listed:
  • Josphat Nyoni

    (Women’s University in Africa, Harare , Zimbabwe)

  • Precious Kwashirai

    (Women’s University in Africa, Harare , Zimbabwe)

  • Oliver Kapepa

    (Colonnade Business Leadership School, Zimbabwe)

  • Linience Tsitsi Charuma

    (Chinhoyi University of Technology, Chinhoyi, Zimbabwe)

  • Andrew Jeremiah

    (Namibia University of Science and Technology, Zimbabwe)

  • Martin Dandira

    (Namibia University of Science and Technology, Zimbabwe)

Abstract

The main purpose of the study was to explore organizational capabilities that may improve the performance and competitiveness of Micro Finance Institutions (MFIs) operating in economic crisis business environment. The study was conducted using a sample of 43 MFIs in Harare. An explanatory research design was used. A survey in form of a questionnaire was used to collect data. Regression analysis was used to analyze the data. The main findings of the study are that innovative, leaning and strategic capabilities were commonly used by MFIs during the economic crisis. The study noted that the performance of MFIs used in this study was improved mainly by innovative, learning and strategic capabilities. Marketing and integrative capabilities had a weak influence on the profitability of MFIs. The study concluded that by innovative, learning and strategic capabilities are effective for MFIs during periods of economic crisis. It was also noted that MFIs that adopted the right organizational capabilities were useful in reducing poverty among females as well as well as acting as an accessible source of income during the COVID-18 period. This study therefore recommends that efforts be made by the MFIs to invest in the development of innovative, learning and strategic organizational capabilities. The study also recommends that the Government through the central banks take deliberate to efforts to assist MFIs to develop organizational capabilities such as by innovative, learning and strategic capabilities. This can be done by providing financial and technical support for the development of such organizational capabilities.

Suggested Citation

  • Josphat Nyoni & Precious Kwashirai & Oliver Kapepa & Linience Tsitsi Charuma & Andrew Jeremiah & Martin Dandira, 2021. "Organizational Capabilities that Can Improve Profitability of Micro-Finance Institutions in Periods of Economic Crisis. Experiences from the Zimbabwe," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 5(08), pages 459-466, August.
    • Handle: RePEc:bcp:journl:v:5:y:2021:i:08:p:459-466
    as

    Download full text from publisher

    File URL: https://www.rsisinternational.org/journals/ijriss/Digital-Library/volume-5-issue-8/459-466.pdf
    Download Restriction: no
    File URL: https://rsisinternational.org/virtual-library/papers/organizational-capabilities-that-can-improve-profitability-of-micro-finance-institutions-in-periods-of-economic-crisis-experiences-from-the-zimbabwe/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Paul Ouma & James Kilika, 2018. "Innovation Strategies, First Mover Advantage and Performance in the Context of the Microfinance Sector: A Review of Literature," International Journal of Business and Management, Canadian Center of Science and Education, vol. 13(7), pages 195-195, June.
    2. David J. Teece & Gary Pisano & Amy Shuen, 1997. "Dynamic capabilities and strategic management," Strategic Management Journal, Wiley Blackwell, vol. 18(7), pages 509-533, August.
    3. Mersland, Roy & Øystein Strøm, R., 2009. "Performance and governance in microfinance institutions," Journal of Banking & Finance, Elsevier, vol. 33(4), pages 662-669, April.
    4. Kostopoulos, Konstantinos & Papalexandris, Alexandros & Papachroni, Margarita & Ioannou, George, 2011. "Absorptive capacity, innovation, and financial performance," Journal of Business Research, Elsevier, vol. 64(12), pages 1335-1343.
    5. Kathleen M. Eisenhardt & Jeffrey A. Martin, 2000. "Dynamic capabilities: what are they?," Strategic Management Journal, Wiley Blackwell, vol. 21(10‐11), pages 1105-1121, October.
    6. Raphael Amit & Lawrence Glosten & Eitan Muller, 1993. "Challenges To Theory Development In Entrepreneurship Research," Journal of Management Studies, Wiley Blackwell, vol. 30(5), pages 815-834, September.
    7. Birger Wernerfelt, 1984. "A resource‐based view of the firm," Strategic Management Journal, Wiley Blackwell, vol. 5(2), pages 171-180, April.
    8. K. Lopatta & M. Tchikov, 2016. "Do microfinance institutions fulfil their promise? Evidence from cross-country data," Applied Economics, Taylor & Francis Journals, vol. 48(18), pages 1655-1677, April.
    9. Virginie Allaire & Arvind Ashta & Laurence Attuel-Mendes & Karuna Krishnaswamy, 2009. "Institutional Analysis to explain the Success of Moroccan Microfinance Institutions," Working Papers CEB 09-057.RS, ULB -- Universite Libre de Bruxelles.
    10. Akalewold Fedilu Mohammed & Mesfin Hirpato Wobe, 2019. "Factors Affecting Loan Repayment Performance of Microfinance Institution Borrowers: The Case of Omo Microfinance at Wondo Genet Woreda, Ethiopia," International Journal of Applied Behavioral Economics (IJABE), IGI Global, vol. 8(2), pages 27-43, April.
    11. Christoph Zott, 2003. "Dynamic capabilities and the emergence of intraindustry differential firm performance: insights from a simulation study," Strategic Management Journal, Wiley Blackwell, vol. 24(2), pages 97-125, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhang-Zhang, YingYing & Rohlfer, Sylvia & Varma, Arup, 2022. "Strategic people management in contemporary highly dynamic VUCA contexts: A knowledge worker perspective," Journal of Business Research, Elsevier, vol. 144(C), pages 587-598.
    2. Patnaik, Swetketu & Munjal, Surender & Varma, Arup & Sinha, Sujay, 2022. "Extending the resource-based view through the lens of the institution-based view: A longitudinal case study of an Indian higher educational institution," Journal of Business Research, Elsevier, vol. 147(C), pages 124-141.
    3. Schriber, Svante & Löwstedt, Jan, 2015. "Tangible resources and the development of organizational capabilities," Scandinavian Journal of Management, Elsevier, vol. 31(1), pages 54-68.
    4. Cleverton Rodrigues Fernandes & André Gustavo Carvalho Machado, 2019. "Technology Transfer Capability: development dynamics in higher education institutions," Brazilian Business Review, Fucape Business School, vol. 16(1), pages 1-15, January.
    5. Liu, Zuoming, 2020. "Unraveling the complex relationship between environmental and financial performance ─── A multilevel longitudinal analysis," International Journal of Production Economics, Elsevier, vol. 219(C), pages 328-340.
    6. Byungjoo Paek & Joohyun Kim & Joonyoung Park & Heesang Lee, 2019. "Outsourcing Strategies of Established Firms and Sustainable Competitiveness: Medical Device Firms," Sustainability, MDPI, vol. 11(17), pages 1-28, August.
    7. Maree Storer & Paul Hyland, 2011. "Utilizing Industry-led Innovation Capacity to Enhance Supply Chain Performance : An Empirical Study," Modern Applied Science, Canadian Center of Science and Education, vol. 5(6), pages 1-55, December.
    8. Chwiłkowska-Kubala, Anna, 2021. "What are the sources of regional airport economic effectiveness? The dynamic capabilities perspective with evidence from Poland," Journal of Air Transport Management, Elsevier, vol. 92(C).
    9. Mohamed Mansouri & Cheklekbire Malainine & Hayat Souti & Ikram Cadimi, 2022. "Dynamic capabilities, competitiveness and performance of small and medium-sized enterprises: a systematic literature review [Capacités dynamiques, compétitivité et performance des petites et moyenn," Post-Print hal-03794567, HAL.
    10. Mary Beth Rousseau & Blake D. Mathias & Laura T. Madden & T. Russell Crook, 2016. "Innovation, Firm Performance, And Appropriation: A Meta-Analysis," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(03), pages 1-29, April.
    11. Philip T. Roundy & Dutch Fayard, 2019. "Dynamic Capabilities and Entrepreneurial Ecosystems: The Micro-Foundations of Regional Entrepreneurship," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 28(1), pages 94-120, March.
    12. Dedy Dewanto Soeprapto, 2022. "The characteristic of follower’s personal mastery: A case in Indonesian construction industry," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 11(6), pages 657-669, September.
    13. FeCheng Ma & Farhan Khan & Kashif Ullah Khan & Si XiangYun, 2021. "Investigating the Impact of Information Technology, Absorptive Capacity, and Dynamic Capabilities on Firm Performance: An Empirical Study," SAGE Open, , vol. 11(4), pages 21582440211, November.
    14. Claudio Vitari & Elisabetta Raguseo, 2016. "Big data value and financial performance: an empirical investigation [Digital data, dynamic capability and financial performance: an empirical investigation in the era of Big Data]," Post-Print halshs-01923271, HAL.
    15. Ahmad Ibrahim Aljumah & Mohammed T. Nuseir & Md. Mahmudul Alam, 2021. "Traditional marketing analytics, big data analytics and big data system quality and the success of new product development," Post-Print hal-03538161, HAL.
    16. Jim Andersén, 2023. "Green resource orchestration: A critical appraisal of the use of resource orchestration in environmental management research, and a research agenda for future study," Business Strategy and the Environment, Wiley Blackwell, vol. 32(8), pages 5506-5520, December.
    17. Zhao, Nanyang & Hong, Jiangtao & Lau, Kwok Hung, 2023. "Impact of supply chain digitalization on supply chain resilience and performance: A multi-mediation model," International Journal of Production Economics, Elsevier, vol. 259(C).
    18. Elia, Stefano & Giuffrida, Maria & Mariani, Marcello M. & Bresciani, Stefano, 2021. "Resources and digital export: An RBV perspective on the role of digital technologies and capabilities in cross-border e-commerce," Journal of Business Research, Elsevier, vol. 132(C), pages 158-169.
    19. Iyer, Karthik N.S. & Srivastava, Prashant & Srinivasan, Mahesh, 2019. "Performance implications of lean in supply chains: Exploring the role of learning orientation and relational resources," International Journal of Production Economics, Elsevier, vol. 216(C), pages 94-104.
    20. Amandine Maus & Sylvie Sammut, 2018. "Business model innovation in incubators: the role played by dynamic capabilities theory," Post-Print hal-02466175, HAL.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bcp:journl:v:5:y:2021:i:08:p:459-466. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Pawan Verma (email available below). General contact details of provider: https://rsisinternational.org/journals/ijriss/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.