HUMAN CAPITAL, SOCIAL CAPITAL, AND STRATEGIC MANAGEMENT AS DRIVERS OF ORGANIZATIONAL CONTEXT AND ITS IMPACT ON SME PERFORMANCE: INTEGRATED RBV-TOE HIGHER-ORDER MODEL IN THE UAE

Abstract

This study advances understanding of SME performance in the United Arab States (UAE) by conceptualizing organizational context as a higher-order strategic capability formed by human capital, social capital, and strategic management. Drawing on the resource-Based View (RBV) and the Technology-Organization-Environment (TOE) framework, the research positions these intangible resources as formative dimensions that collectively strengthen a firm ‘s internal conditions through which performance outcomes are achieved. Using stratified random sampling data were collected from 408 SME owners, managers, and CEOs across the UAE. Structural Equation Modelling (SEM) was employed to validate the higher-order construct and to examine the hypothesized relationships. The results reveal that human capital, social capital, and strategic management significantly enhance the organizational context, which subsequently exerts a positive effect on SME performance. These findings support RBV’s assertion that bundles of intangible resources underpin superior performance, while TOE highlights the importance of organizational readiness in enabling firms to translate internal capabilities into meaningful outcomes. By integrating these two theoretical perspectives within an emerging market setting, this study introduces a novel higher-order capability model to SME research and offers practical implications for policymakers and business leaders seeking to strengthen SME resilience, growth, and long-term sustainability in the UAE.