Identification of Determinants for Globalization of SMEs using Multi-Layer Perceptron Neural Networks

Abstract

SMEs (Small and Medium Sized Enterprises) sector is facing problems relating to implementation of international quality standards. These SMEs need to identify factors affecting business success abroad for intelligent allocation of resources to the process of internationalization. In this paper, MLP NN (Multi-Layer Perceptron Neural Network) has been used for identifying relative importance of key variables related to firm basics, manufacturing, quality inspection labs and level of education in determining the exporting status of Pakistani SMEs. A survey has been conducted for scoring out the pertinent variables in SMEs and coded in MLP NNs. It is found that ‘firm registered with OEM (Original Equipment Manufacturer) and ‘size of firm’ are the most important in determining exporting status of SMEs followed by other variables. For internationalization, the results aid policy makers in formulating strategies