Premium
Growth and performance contrasts between ‘types’ of small firms
Author(s) -
Birley Sue,
Westhead Paul
Publication year - 1990
Publication title -
strategic management journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 11.035
H-Index - 286
eISSN - 1097-0266
pISSN - 0143-2095
DOI - 10.1002/smj.4250110705
Subject(s) - profitability index , variance (accounting) , industrial organization , sample (material) , cluster (spacecraft) , product (mathematics) , business , marketing , econometrics , economics , accounting , computer science , mathematics , geometry , chemistry , finance , chromatography , programming language
This paper studies the interrelationships in the strategic profile of a sample of small firms, and, by using cross‐sectional analysis, attempts to identify any evidence to support the ‘stages of growth’ theories. Three surrogates for comparative growth were used in the analysis: number of employees, sales turnover, and profitability. A cluster analysis identified eight different ‘types’ of small firms characterized by ‘internal’ variables of ownership, management, and product structure; and by ‘external’ variables of product/market positioning. Analysis of variance tests found no significant differences between the clusters with regard to size. The results suggest that firms do change, but not necessarily in any prescribed sequence. Indeed, the evidence presented in this paper suggests that future research should be focused on developing theories which better describe the heterogeneity of the sector by analyzing the development within clusters of firms rather than seeking generalized overarching theories.