1

Business Research Method

Research Proposal
The impact of employees training on the performance of SMEs in Gujranwala
Department: Gift Business School
Gift University Gujranwala
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Executive Summary
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Table of Contents
Executive Summary ....................................................................................................................................... 2
Chapter: 1...................................................................................................................................................... 5
Introduction: ............................................................................................................................................. 5
Objectives of the Study: ............................................................................................................................ 6
Scope of the Study: ................................................................................................................................... 6
Literature Review: ..................................................................................................................................... 6
Theoretical Framework: ............................................................................................................................ 8
Research Hypotheses: ............................................................................................................................... 9
Chapter 2 ....................................................................................................................................................... 9
Methodology: ............................................................................................................................................ 9
Type of Study: ........................................................................................................................................... 9
Unit of Analysis: ........................................................................................................................................ 9
Data Analysis Technique: ........................................................................................................................ 10
Data Preparation and Entry .................................................................................................................... 10
Reliability of data .................................................................................................................................... 10
Descriptive Analysis ................................................................................................................................ 10
Anova Test: ............................................................................................................................................. 10
Chi-Square Test; ...................................................................................................................................... 10
Chapter: 4.................................................................................................................................................... 11
Findings: .................................................................................................................................................. 11
Descriptive Statistics: .............................................................................................................................. 11
Normality of Data:................................................................................................................................... 12
Welch Test .............................................................................................................................................. 14
Ta mhane and Dunnet T3 ........................................................................................................................ 16
Company Efficiency after Training .......................................................................................................... 16
Chapter 5 ..................................................................................................................................................... 19
DISCUSSION AND CONCLUSION .............................................................................................................. 19

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5

Chapter: 1
Introduction:
Small and medium enterprises are the backbone for any economy. These SMEs contribution in
the gross domestic product is greater than large firms in under develop economies. The
sustainability of small and medium enterprise is very important because these SMEs contribute
larger portion in the economic development of any country. The performance of these small and
medium enterprises is very important. These SMEs have many different problems in today
world. The performance of these SMEs varies due to the employees issues. There is also a lack
of technical labor for these small medium enterprises.
Small companies have less capital for advance machinery to improve the production process and
thats why relying mostly on the labor skills. To gain the competitive advantage the skilled and
technical labor is required. But the demand for skilled laborers exceeded the supply in today
competitive labor market. The Gujranwala region has a large number of entrepreneurs.
At present time most small companies are focusing on employees training. The changing nature
of work in SMEs requires the employees training. The newly hired employees also need very
deep training about the production processes and how to use the equipment.
The employees absenteeism due to lack of required skills also causes to stop the production in
the small companies and may result in greater cost for running the company. The absenteeism
occurs due to the many factors like anxieties about the job performance which mostly new
employees have.
These small and medium enterprises are trying to reduce the cost to earn more profit and to
capture the larger market share. The total cost of these SMEs has significant portion of labor
cost.
These SMEs have some control over the internal factors that effect SMEs performance like
employees training. The performance of these SMEs also depends on the many different factors
like employee morale, commitment, productivity and the employees turnover etc. Some
companies are now investing on training, so measuring the impact of training on small and
medium enterprise is a very crucial for these SMEs.
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Objectives of the Study:
The objectives of the study are as follows:
i. To examine the relationship between employees training and SMEs performance
ii. To examine the relationship between employees training and defects in the production
iii. To examine the relationship between training and employees productivity
iv. To examine the relationship between training and stress on employees.
Scope of the Study:
The impact of employees training on small medium enterprises will be analyzed in Gujranwala
region in different industrial areas. These small and medium size companies will include the
registered and unregistered companies which are located in different areas of city.
Literature Review:
James, (2013) said that the well-trained employees are the key to your small business success.
The most successful, productive employees are those who have received extensive training.
Theyre the cream of the crop, often having the strongest stake in the companys future.
As Brume (2007) said that, Training can have a considerable influence on company finances as
there are several potential training costs that companies may incur. One type of training related
cost is direct cost. This may include instructor salary, materials, and follow-up supervision. A
second type of training related cost is indirect cost. These costs are related to worker output and
productivity during and upon completion of the training.
Becker (1964) made a distinction between firm specific and general training. General training
results in skills that are equally applicable at other firms while skills acquired through firm
specific training are lost when the trained worker leaves the firm that provided training.
Miller (2012) said the initial investment in training may seem costly; the long-term benefits play
an integral role in the success of an organization. Improving employee communication skills will
improve employee engagement and reduce employee turnover. But the most significant benefit is
the increase in revenue.
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Another benefit of training includes that it helps SMEs to cope with the latest accounting
systems, information technology, management concepts and production techniques (Jones,
2004).
In addition to the training other factors such as relevant education and experiences are required
to cope with work and environment changes (Bryan, 2006). The training seemed to be ignored
and is not regarded as an activity that could help SMEs create value and help them to
successfully deal with competitive and environmental challenges. Noe (1998) found that
enterprises that use innovative training practices are more likely to report better financial
performance than their competitors who lack such training.
Bryan (2006) also said that the Impact of training need to be assessed, its effectiveness and
impact of training on SMEs performance.
Therefore, this study will fill the gap because there is no research study available for the SMEs
of Gujranwala region. The study will examine the relation between different variables like
training impact on employees and the performance of the company.
Definition of Key Terms:
Small and medium enterprise:
According to the approved SME Policy 2007 a company which has employees up to 250 or paid-
up capital up to 25 million or annual sales up to 250 million will fall in the SMEs category.

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Theoretical Framework:























Company efficiency in
production
Defects in production
Productivity of
employees
Commitment of employees
Stress on employees
Turnover of employees
Production cost of the
company
Training of employees Performance of
the Company
Moral of employees
Quality of products
Profit of the company
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Research Hypotheses:
H0; there is no association between the employees training and SMEs performance
H1; there is association between the employees training and SMEs performance

Chapter 2
Methodology:
To conduct this research the informal interviews of employees in small and medium size
enterprises conducted to form the questionnaire. The questionnaire made after conducting and
analyzing the employees thinking.
Our research is hypothesis in which we measured the impact of employees training on employees
and company performance. The relation of training with performance was analyzed with the help
of different hypothesis after that the hypothesis was checked by some statistics Also the data of
questionnaires was analyzed in the SPSS software and different graphs were used.
The data was collected during the working hours of employees because at that time they were
easily showing some real aspects of training and the stress they feel during work. The
questionnaire was given to the employees in two languages so that the illiterate workers can
easily understand the important questions.
Type of Study:
This research is a hypothesis testing study. It explains the impacts of employees training on the
performance of SMEs in the Gujranwala region.
Unit of Analysis:
Only the manufacturing SMEs in Gujranwala were considered for this study. The target
respondents for this study were employees and employers who have filled the questionnaires
with different opinions.
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Data Analysis Technique:
Data Preparation and Entry
The data from the respondents was collected through the questionnaires which were provided
them during workplace. After that collection the data was putted into the SPSS software
Reliability of data
The reliability of the data is checked by the Normality assumption and by the leven,s statistics to
check the equality of variances.
Descriptive Analysis
The descriptive statistics of different variables were collected through the SPSS software like
mean, stander deviation, variances and charts like histogram
Anova Test:
To check the hypothesis the analysis of variance test was applied to compare the variances of
different variables.
Chi-Square Test;
The chi-square test was used to check the association between the employees training and
performance of small and medium enterprises.

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Chapter: 4
Findings:
Descriptive Statistics:

Descriptive Statistics

N Range Mean Std. Deviation Variance Skewness
Statistic Statistic Statistic Statistic Statistic Statistic Std. Error
Skills of employees after
training
30 4 1.73 .980 .961 1.760 .427
employees performance
after training
30 4 2.40 1.380 1.903 .814 .427
company efficiency after
training
30 4 2.23 1.251 1.564 .772 .427
defects in production after
training
30 4 2.10 1.094 1.197 1.145 .427
employees productivity after
training
30 3 2.03 .850 .723 .655 .427
employees commitment
after training
30 4 2.13 1.042 1.085 .894 .427
stress feeling of emplyees
after training
30 4 2.10 .960 .921 1.295 .427
cost of production after
training
30 4 2.23 1.251 1.564 .772 .427
products quality after
training
30 4 2.03 1.033 1.068 1.537 .427
employees turnover after
training
30 4 2.07 1.202 1.444 1.398 .427
employees moral after
training
30 3 1.83 .874 .764 .676 .427
is training benefial for both
employee and company
30 1 1.20 .407 .166 1.580 .427
impact of training on
company profits
30 1 1.20 .407 .166 1.580 .427
age of the respondents 30 10 25.13 2.751 7.568 .149 .427
gender of the respondents 30 1 1.20 .407 .166 1.580 .427
Valid N (listwise) 30

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Normality of Data:

Tests of Normality

Kolmogorov-Smirnov
a
Shapiro-Wilk
Statistic df Sig. Statistic df Sig.
Skills of employees after
training
.273 30 .000 .728 30 .000
employees performance
after training
.281 30 .000 .829 30 .000
company efficiency after
training
.207 30 .002 .853 30 .001
defects in production after
training
.236 30 .000 .820 30 .000
employees productivity after
training
.282 30 .000 .841 30 .000
employees commitment
after training
.251 30 .000 .859 30 .001
stress feeling of emplyees
after training
.342 30 .000 .793 30 .000
cost of production after
training
.207 30 .002 .853 30 .001
products quality after
training
.313 30 .000 .768 30 .000
employees turnover after
training
.289 30 .000 .770 30 .000
employees moral after
training
.263 30 .000 .816 30 .000
is training benefial for both
employee and company
.488 30 .000 .492 30 .000
impact of training on
company profits
.488 30 .000 .492 30 .000
age of the respondents .160 30 .049 .946 30 .133
gender of the respondents .488 30 .000 .492 30 .000
a. Lilliefors Significance Correction



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Homogeneity of Variances:

Test of Homogeneity of Variances

Levene Statistic df1 df2 Sig.
Skills of employees after
training
3.502 4 25 .021
employees performance
after training
2.458 4 25 .072
defects in production after
training
1.288 4 25 .301
employees productivity after
training
2.237 4 25 .094
employees commitment
after training
1.389 4 25 .266
stress feeling of emplyees
after training
4.737 4 25 .006
cost of production after
training
1.538 4 25 .222
products quality after
training
2.795 4 25 .048
employees turnover after
training
.677 4 25 .614
employees moral after
training
2.048 4 25 .118
is training benefial for both
employee and company
1.909 4 25 .140
impact of training on
company profits
3.269 4 25 .028





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Welch Test

Robust Tests of Equality of Means
b,c,d,e,f,g


Statistic
a
df1 df2 Sig.
Skills of employees after
training
Welch 2.288 4 4.946 .195
employees performance
after training
Welch .663 4 5.530 .642
defects in production after
training
Welch 1.194 4 4.877 .417
employees productivity after
training
Welch . . . .
employees commitment
after training
Welch .558 4 4.874 .705
stress feeling of emplyees
after training
Welch . . . .
cost of production after
training
Welch .432 4 6.069 .782
products quality after
training
Welch . . . .
employees turnover after
training
Welch .724 4 4.928 .612
employees moral after
training
Welch . . . .
is training benefial for both
employee and company
Welch . . . .
impact of training on
company profits
Welch . . . .
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Robust Tests of Equality of Means
b,c,d,e,f,g


Statistic
a
df1 df2 Sig.
Skills of employees after
training
Welch 2.288 4 4.946 .195
employees performance
after training
Welch .663 4 5.530 .642
defects in production after
training
Welch 1.194 4 4.877 .417
employees productivity after
training
Welch . . . .
employees commitment
after training
Welch .558 4 4.874 .705
stress feeling of emplyees
after training
Welch . . . .
cost of production after
training
Welch .432 4 6.069 .782
products quality after
training
Welch . . . .
employees turnover after
training
Welch .724 4 4.928 .612
employees moral after
training
Welch . . . .
is training benefial for both
employee and company
Welch . . . .
impact of training on
company profits
Welch . . . .
a. Asymptotically F distributed.. Robust tests of equality of means cannot be performed for
employees productivity after training because at least one group has 0 variance.
c. Robust tests of equality of means cannot be performed for stress feeling of emplyees
after training because at least one group has 0 variance.
d. Robust tests of equality of means cannot be performed for products quality after training
because at least one group has 0 variance.
e. Robust tests of equality of means cannot be performed for employees moral after
training because at least one group has 0 variance.
f. Robust tests of equality of means cannot be performed for is training benefial for both
employee and company because at least one group has 0 variance.
g. Robust tests of equality of means cannot be performed for impact of training on
company profits because at least one group has 0 variance.

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Ta mhane and Dunnet T3

ANOVA

Sum of Squares df Mean Square F Sig.
Skills of employees after
training
Between Groups 12.064 4 3.016 4.771 .005
Within Groups 15.803 25 .632

Total 27.867 29

employees performance
after training
Between Groups 3.643 4 .911 .442 .777
Within Groups 51.557 25 2.062

Total 55.200 29

employees moral after
training
Between Groups 4.610 4 1.152 1.641 .195
Within Groups 17.557 25 .702

Total 22.167 29

stress feeling of emplyees
after training
Between Groups 5.200 4 1.300 1.512 .229
Within Groups 21.500 25 .860

Total 26.700 29


Company Efficiency after Training


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Chi-Square Test
Chi-Square Tests

Value df
Asymp. Sig. (2-
sided)
Pearson Chi-Square 17.795
a
16 .336
Likelihood Ratio 18.057 16 .321
Linear-by-Linear Association .189 1 .664
N of Valid Cases 30

a. 24 cells (96.0%) have expected count less than 5. The minimum
expected count is .07.



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Kruskal-Wallis Test
Ranks

company efficiency after
training N Mean Rank
Skills of employees after
training
strongly agree 11 10.36
agree 8 23.13
neutral 6 14.50
disagree 3 16.67
strongly disagree 2 14.50
Total 30

employees productivity after
training
strongly agree 11 13.64
agree 8 17.31
neutral 6 13.83
disagree 3 16.00
strongly disagree 2 22.75
Total 30

Test Statistics
a,b


Skills of
employees after
training
employees
productivity
after training
Chi-Square 11.984 2.832
df 4 4
Asymp. Sig. .017 .586
a. Kruskal Wallis Test
b. Grouping Variable: company efficiency after
training





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Chapter 5
DISCUSSION AND CONCLUSION
The above statistical calculation shows that the data in normal. The data has filled the
assumption of normality which we have checked through the Normality test in the spss. The p-
values in this test are very small and less than .05 so we reject H0 and accept H1. Finally we
conclude that our data is normal.
After the Normality test the test of Homogeneity of Variances is performed on the data which
shows that our homogeneity of variances assumption is not fulfilled. The variances of the
variables are not same so we cannot directly use Anova test.
For unequal variances we have used the welch test because our variances are not same in the
previous test. We have used the Ta mhane and Dunnet T3 test for unequal variances. Because
our means are not equal so we also used the Kruskal-Wallis Test for unequal means.
Finally our main issue was to check the association between the employees training and the
performance of the company. For this matter we have developed the hypothesis to check the
association between these variables. Our null and alternative hypothesis are clearly defined
above.
Also the p-value of the chi-squar coefficient is less than greater than .05 which shows that there
is no association between the training of employees and performance of the company.
Finally our analysis of Anova by using Welch test indicate that the mostly p-values are greater
than the .05 and falls in the acceptance region. This shows that our null hypothesis is accepted
and alternate hypothesis is rejected.
Finally we conclude that there is no association between the training of employees and the
performance of the company. These both variables are independent variable and does not have
any impact on each other. Some other variables may affect the company performance.

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References:
Becker, G.S. (1964). Human Capital. Chicago: The University of Chicago Press.
Jones. (2004). Training, Development, and Business Growth: A study of Australian
Manufacturing Small-Medium Sized Enterprises. Asia Pacific Journal of Human Resources.
42(1):96-121.
Bryan. (2006). Training and Performance in Small Firms. International Small Business Journal.
24 (6):635-660.
Noe, R., A. (2002). Employee Training and Development (2nd Edition), Boston:
Irwin/McGraw-Hill.
Brume, S. (2007). What impact does training have on employee commitment and employee
turnover. Schmidt Labor Research Center Seminar Research Series. Retrieved Nov. 4, 2013
from: http://www.uri.edu/research/lrc/research/papers/Brum-Commitment.pdf
James, S. (2013). Well Trained Employees are the Key to Small Business Success. Retrieved
Nov. 3, 2013 from: http://www.farmcentre.com/content/well-trained-employees-are-key-small-
business-success
Miller, R. (2012). Employee Training ROI: What You Need to Know [online] Available at
http://www.impactlearning.com

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Survey Questionnaire
I am a student of MBA. I am conducting a research to measure the impact of training on
production cost in small and medium size enterprises in Gujranwala region. Your feedback will
play an important role in increasing the performance of these SMEs.
For each question listed below, circle the numbers that best fits your judgment. Use the below
mentioned scale to select numbers.
Strongly Agree Agree Neutral Disagree
Strongly
Disagree
1 2 3 4 5
1. Training increases the skills of employees 1 2 3 4 5
2. Training improves the performance of employees 1 2 3 4 5
3. Training increases the company efficiency in
producing products
1 2 3 4 5
4. Training reduces the defects in the production 1 2 3 4 5
5. Employees productivity increases after training 1 2 3 4 5
6. Employees commitment increases after training 1 2 3 4 5
7. Training reduces the stress on the employees in
working places
1 2 3 4 5
8. Training of employees reduces the cost of production
of company
1 2 3 4 5
9. Training improves the Quality of products 1 2 3 4 5
10. Employees turnover reduces after training 1 2 3 4 5
11. Employees moral increase after training 1 2 3 4 5
12. Is training beneficial for both employee and company
Yes
No
13. Does the trained employees increases the profit of the company
Yes
No

Age: Gender: