Abstract:
Small and medium enterprises (SMEs) in Kenya represent a vital part of the economy,
being the source of various economic contributions through the generation of income via
exporting, providing new job opportunities, introducing innovations, stimulating
competition, and engine for employment. Present economy is known as a knowledgebased
economy where, knowledge, information and soft assets have more importance
rather than the physical assets. The role and importance of SMEs in a knowledge-based
economy has been highly appreciated and acknowledged. Moreover, in the present
economy, SMEs are facing tremendous challenges and threats to survive in a competitive
environment.
The study examined the influence of Intellectual Capital (IC) and growth of SMEs in
Kenya. The study was guided by the following research objectives which include; finding
out to what extent managerial skills, entrepreneurial skills; innovativeness, structural
capital and customer capital influence the growth of SMEs in Kenya.
The study adopted descriptive survey and exploratory design. The study targeted 4560
SMEs in Nairobi County who are registered by Ministry of Industrialization and Ministry
of Trade. Regression models was used to examine the influence of intellectual capital on
growth of SMEs in Kenya. The study found that intellectual capital components
(managerial skills, entrepreneurial skills, innovativeness, structural capital, and customer
capital) have a great positive influence on the growth of SMEs. Managerial skills was
International Journal of Arts and Entrepreneurship Special Issue, 2013
http://www.ijsse.org ISSN 2307-6305 Page | 14
most significant with correlation coefficient of 78.9% elements of intellectual capital
influencing growth of small and medium enterprises in Kenya.
