An Assessment of Business Management Practices' Effect on the Performance of Small and Medium Enterprises in Lusaka Central Business District

This study purposed to assess business management practices’ effect on the performance of small and medium enterprises (SMEs) in Lusaka's Central Business District (CBD). The study was underpinned by three research objectives: to examine current business management practices adopted by SMEs, to determine the effect of these practices on SMEs’ performance, and to explore strategies for enhancing business practices. A mixed-method research approach guided the study. A mixed-method research approach guided the study, which targeted a population of 37,000 SMEs in the CBD, with a sample size of 100 participants, which comprised 83 business owners/managers and 17 officials from the Ministry of Small and Medium Enterprises Development. Data was collected through questionnaires and interviews and analyzed using the Statistical Package for Social Sciences (SPSS). 100 questionnaires were distributed to SME owners/managers and officials from MSMED while interviews were conducted with 10 selected SMEs participating in the questionnaire administration. Out of the 100 questionnaires circulated to SMEs, 80 were returned representing an 80% response rate. The study employed purposive and random sampling to strengthen the findings' validity, reliability, and generalizability. The findings revealed that financial management, human resource management, marketing strategies, and strategic planning are key management practices employed by SMEs in CBD. The study found that business management practices significantly and positively affect business performance, leading to improved productivity, profitability, competitiveness, and overall success. However, challenges such as lack of management expertise, high employee turnover, and ineffective performance measurement hinder the adoption and effectiveness of these practices. The study concludes that SMEs can enhance their business management practices and improve performance by adopting effective human resource management, financial management, and strategic marketing practices. Key recommendations include SME owners/managers identifying and implementing missing management practices, embracing modern technologies, and employing SME support mechanisms to help managers and owners acquire the necessary skills. Additionally, the study recommends that SMEs should regularly assess their performance against management practices adopted to ascertain their effect on performance.