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Article
Publication date: 1 December 2005

Bernice Kotey

The purpose of this study is to examine the impact of firm size on performance (measured as profits, growth, efficiency and liquidity) differences between family and non‐family…

3653

Abstract

Purpose

The purpose of this study is to examine the impact of firm size on performance (measured as profits, growth, efficiency and liquidity) differences between family and non‐family smallto medium‐sized enterprises (SMEs).

Design/methodology/approach

The samples of 441 family and 473 non‐family firms were divided into four size groups and performance differences analysed for each size group using MANOVA.

Findings

The findings indicate that family SMEs perform at least as well as non‐family SMEs. Although the two types of firms shared several similar performance characteristics at the small level, certain differences were evident. Performance differences between family and non‐family SMEs became prominent at the critical growth phase (20‐49 employees), reached an optimum at 50‐99 employees and narrowed again thereafter. For family firms, the benefits of higher gross margins and efficient use of assets began to wane after 100 plus employees but the disadvantages of lower employee performance continued.

Research limitations/implications

The study could be improved by a longitudinal examination of the same firms across various growth stages. Further, the findings may be industry‐specific and not generally applicable.

Practical implications

The findings show that greater resources do not necessary lead to better performance and that non‐family firms could benefit from more efficient use of resources. The findings also confirm that the benefits of the informal system are not sustainable at larger firm sizes and that larger family firms would benefit from improved management of employee performance.

Originality/value

The pattern of performance differences observed between family and non‐family SMEs is unique to the paper. The paper shows that differences in performance between the two types of firms noted in the literature do no hold at all firm sizes.

Details

International Journal of Entrepreneurial Behavior & Research, vol. 11 no. 6
Type: Research Article
ISSN: 1355-2554

Keywords

Article
Publication date: 18 July 2008

Naomi Birdthistle

The purpose of this paper is to investigate whether small and medium‐sized family businesses in Ireland have the potential to be classified as learning organizations.

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Abstract

Purpose

The purpose of this paper is to investigate whether small and medium‐sized family businesses in Ireland have the potential to be classified as learning organizations.

Design/methodology/approach

The research methodology adopted for this study is that of multiple‐case studies. In this research, personal interviews were selected as the data collection method. On the basis of Eisenhardt's premise that a study of between four and ten cases is suitable for qualitative studies, a total of six owner‐managers of family small and medium‐sized enterprises (SMEs) were interviewed.

Findings

The findings of the case studies support the argument that family businesses have the potential to be learning organizations. However, the extent to which these family businesses are potentially learning organizations depends on the size of the family business and the structure imposed on the business. Micro family businesses struggle to be classified as learning organizations due to the lack of a learning orientation. These businesses lack systems for the monitoring of information and lack the ability to be reactive to market changes. Small family businesses have the potential to be classified as learning organizations. This is due to the fact that small family businesses have learning at the core of their business and systems in place to deal with a learning orientation. Medium‐sized family businesses also have the potential to be learning organizations, although they need to ensure that systems are in place to allow learning to occur.

Originality/value

This paper presents original findings in a highly relevant, but under‐researched field – the family SME as a learning organization.

Details

The Learning Organization, vol. 15 no. 5
Type: Research Article
ISSN: 0969-6474

Keywords

Article
Publication date: 1 April 1994

Peter Rosa, Michael Scott and Robin Gilbert

Government assistance to exporting small firms in the UK tends to bepassive, providing information, contacts, access to subsidizedconsultancy and credit guarantees, rather than…

791

Abstract

Government assistance to exporting small firms in the UK tends to be passive, providing information, contacts, access to subsidized consultancy and credit guarantees, rather than direct training. The system favours the larger company, and does little to address problems faced by many small and medium‐sized enterprises (SMEs) whose owners have less clear strategic goals, react entrepreneurially to opportunities and have access to limited resources. The education system too has done little to promote vocational training in export management for SMEs. Graduates, particularly language graduates, from universities and colleges, have the potential to be good export managers, but seldom get the opportunity. Many end up unemployed, a considerable waste of human resources. Since the late 1980s the Scottish Enterprise Foundation, University of Stirling, has run programmes providing export management training for language graduates, involving project placements in small and medium‐sized companies, and leading to a diploma in Small Firms Exporting. Examines the impact of this course on participating firms and graduates. Results of a follow‐up survey show that, despite some problems, the overall effectiveness of the programme is promising, both in “capturing” language skills for industry, and in developing an international focus in companies.

Details

Journal of European Industrial Training, vol. 18 no. 3
Type: Research Article
ISSN: 0309-0590

Keywords

Article
Publication date: 1 August 2002

Hernan Riquelme

Earlier research studies predicted that it would be small and medium‐sized businesses that were more likely to adopt and benefit from the use of the Internet because of their…

3206

Abstract

Earlier research studies predicted that it would be small and medium‐sized businesses that were more likely to adopt and benefit from the use of the Internet because of their greater flexibility. Anecdotal evidence appears in the literature to support this claim; however, little systematic empirical research has been done among SMEs to test this speculation. A sample of 248 companies in Shanghai, China, was divided into small, medium and large groups. The statistical analysis indicates that there are significant differences between large and small companies. Large companies have benefited considerably more from the Internet than small companies not only in their increased sales (derived from the Internet) but also from cost savings. Although the whole sample confirms the main reason for establishing an Internet connection, to gain a competitive advantage, companies also think that the Internet does not work equally for all players.

Details

Internet Research, vol. 12 no. 3
Type: Research Article
ISSN: 1066-2243

Keywords

Article
Publication date: 23 February 2010

Cinzia Dessì and Michela Floris

The paper aims to focus on management‐customer relations as a way to understand the competitive advantages of small/medium‐sized family businesses. The aim of this work is to

1240

Abstract

Purpose

The paper aims to focus on management‐customer relations as a way to understand the competitive advantages of small/medium‐sized family businesses. The aim of this work is to verify whether management perceptions of business strengths and customer perceptions of the same strengths agree, and whether this agreement (perceptive concordance) can become an important factor in maintaining the firm's competitive advantages.

Design/methodology/approach

The research is carried out through a single case study with a sample of 120 customers.

Findings

The findings indicate that when management and customers agree on certain business issues, performance benefits. Comparing management's perception of strengths and customers' perceptions of the same strengths allow one to relate what the firm thinks of itself to what the customer sees in it.

Practical implications

The research offers useful information about the efficiency of the firm's external communications and demonstrates that a shared language between the firm and its customers does exist and is understood by both entities. Moreover, practical implications are related to customers' degree of satisfaction with respect to management beliefs, and to management's opportunity to correct the weaknesses revealed by the agreement factor.

Originality/value

The paper provides a different perspective on how to analyse competitive advantage inside small to medium‐sized family businesses with cases and specific analyses not considered in depth by the family business literature.

Details

Journal of Small Business and Enterprise Development, vol. 17 no. 1
Type: Research Article
ISSN: 1462-6004

Keywords

Article
Publication date: 12 January 2015

– The purpose of this paper is to draw attention to opportunities for further research into the marketing practices of small entrepreneurial firms.

783

Abstract

Purpose

The purpose of this paper is to draw attention to opportunities for further research into the marketing practices of small entrepreneurial firms.

Design/methodology/approach

This study reviews the academic literature and identifies a gap in the existing research. It proposes the use of social practice theory in researching entrepreneurial marketing.

Findings

Entrepreneurship and marketing have a lot in common – especially in small firms (small to medium-sized enterprises [SMEs]). When there’s nobody with a dedicated marketing role, then people all over the organization typically do things that contribute to the firm’s marketing effort. And, when marketing becomes the sum of activities carried out by different individuals at different levels within the SME, it becomes “an all-pervasive way of doing business”, rather like entrepreneurship, in fact.

Research limitations/implications

This study provides a conceptual overview of the benefits of applying social practice theory to the study of entrepreneurial marketing.

Practical implications

This study shows how social practice theory can be applied to the study of entrepreneurial marketing practices.

Social implications

This study explains how these marketing practices can be conceptualized to provide insights into the significance of marketing-related activities in small firms.

Originality/value

This study has the potential to facilitate the development of a new marketing research stream based on social practice theory.

Details

Strategic Direction, vol. 31 no. 1
Type: Research Article
ISSN: 0258-0543

Keywords

Book part
Publication date: 3 July 2018

Peggy Cunningham

The primary purpose of this chapter is to provide insight as to why some privately held small-to-medium sized firms (SMEs) have been able to outperform their peers in terms of…

Abstract

Purpose

The primary purpose of this chapter is to provide insight as to why some privately held small-to-medium sized firms (SMEs) have been able to outperform their peers in terms of their performance defined as revenue growth, profit growth, growth in number of employees and markets. Little is known about privately held firms and what drives their performance. The second purpose is to synthesize and provide clarity to the extant literature on rapid-growth SMEs (gazelles). The third purpose is to bring a unifying theoretical lens to the literature.

Methodology

The research was conducted using elite interviews with 47 informants drawn from 21 rapid-growth, private companies. Qualitative methods were used to identify themes related to the strategies used by these firms to outperform their peers over a five-year period.

Findings

The study organizes and summarizes the extant literature on rapid-growth companies, provides support for some findings, and clarifies equivocal findings. It also suggests that early strategic choices made by the owners of private firms along with their attitudes and capabilities positioned the private firms for rapid growth. The Morgan and Hunt (1994) trust–commitment theory of relationship marketing emerged from the data as the model used most often by rapid-growth private firms and the one that best integrates the factors driving private firm performance. A modified, two-stage model appears to be warranted. The first stage focuses on respect for the value employees bring, and building their trust and commitment is an essential first step that subsequently drives the second stage of the model – building customer trust and commitment. While some of the outcomes are similar to those suggested by Morgan and Hunt, new outcomes (collaborative innovation, citizenship behaviors, sustained growth, and premium prices) also emerged as important outcomes in this study.

Practical implications

This study provides owners of private firms with insight on how to build and grow their firms in a rapid and sustainable fashion.

Originality/value

Little research has been undertaken on private firms. This study addresses this knowledge gap. The modified trust–commitment relationship marketing model that emerged from the data had not been utilized to date in the field of rapid-growth firms and it provides an integrating theory that explains the performance of rapid-growth private firms.

Article
Publication date: 1 June 2012

Banjo Roxas and Doren Chadee

This study aims to challenge the conventional view that resources determine the extent of the environmental sustainability orientation (ESO) of small firms in a developing…

1346

Abstract

Purpose

This study aims to challenge the conventional view that resources determine the extent of the environmental sustainability orientation (ESO) of small firms in a developing Southeast Asian country context. First, this study attempts to develop a measurement model of ESO of small firms in the manufacturing sector in the Philippines. Second, the study explores the impact of the financial resources on the ESO of firms.

Design/methodology/approach

The study uses survey data from 166 small manufacturing firms in three Philippine cities. Multiple regression modelling is used to estimate the relationships between firm resources and ESO.

Findings

The results indicate that ESO is a multi‐dimensional construct with three facets – i.e. awareness of, actions for, and appreciation of environmental sustainability. The empirical evidence does not support the conventional firm resources‐ESO proposition.

Research limitations/implications

A proactive ESO is not necessarily beyond the reach of resource‐constrained small firms. The generalisability of the findings, however, is limited to small manufacturing firms in The Philippines.

Practical implications

This study informs owner‐managers of small firms that a proactive ESO does not largely depend on financial resources. Government policies and programs to encourage small firms to become sustainable should focus not just on financial forms of assistance.

Originality/value

To date, this is the only Philippines‐based study and one of the scarce small firm‐focused studies that examine the proposition that small firms are unable to pursue a proactive ESO due to resource constraints.

Article
Publication date: 23 March 2012

Guilherme Trez and Fernando Bins Luce

This paper aims to develop and test a conceptual model of organizational structure design that incorporates some factors influencing strategy implementation. The research also…

2741

Abstract

Purpose

This paper aims to develop and test a conceptual model of organizational structure design that incorporates some factors influencing strategy implementation. The research also aims to consider inter‐functionality in new product development (NPD) processes and marketing decisions, measured from the dispersion of these activities among functional areas.

Design/methodology/approach

The research was conducted across 424 small and medium‐sized furniture manufacturing companies. In total, eight hypotheses were proposed and tested using structural equation modeling.

Findings

Most important among the study's findings was that inter‐firm relationships and inter‐functional processes are relevant for the study of organizational structure design. It was found that the dispersion of the new product development process and of marketing decisions exert a positive influence on architectural marketing capabilities. The results showed that the dispersion of NPD processes and marketing decisions influence the development of marketing capabilities only in those companies with inter‐firm relationships. The paper also found that inter‐firm design did not affect the impact of the relationship between the dispersion of marketing decisions and NPD process on specialized capabilities.

Research limitations/implications

The study focuses research on Brazilian small to medium‐sized furniture enterprises and could have single‐source bias in its data collection process.

Practical implications

The findings provide insights into ways of integrating structures. It is observed that a higher integration of areas in marketing decisions is related to the dispersion of the NPD process. Given that dispersion in NPD is a disseminated practice, it is found that higher dispersion in marketing activities has an impact on product development.

Originality/value

The paper's findings confirm the influence of organizational design on the development of planning capabilities and on the implementation of marketing strategies.

Details

Marketing Intelligence & Planning, vol. 30 no. 2
Type: Research Article
ISSN: 0263-4503

Keywords

Article
Publication date: 10 August 2010

Tanja Kontinen and Arto Ojala

The purpose of this paper is to investigate how psychic distance affects the internationalization process, foreign market entry (FME), and entry mode choice of Finnish small and…

3193

Abstract

Purpose

The purpose of this paper is to investigate how psychic distance affects the internationalization process, foreign market entry (FME), and entry mode choice of Finnish small and medium‐sized family enterprises (family SMEs) operating in France.

Design/methodology/approach

The paper reports findings from an in‐depth case study covering four Finnish manufacturing family SMEs operating in the French market. The data were analyzed using the Uppsala model and distance creating and distance‐bridging factors encountered in the FME to France.

Findings

The findings reveal that the family SMEs mainly followed a sequential process and favored indirect entry modes before entering the French market. The French market was psychically distant, but the case firms were able to overcome the distance by using different distance‐bridging factors. Based on the findings, it can be argued that psychic distance has an especially important role in the internationalization and the FME of family SMEs, mainly because of their general cautiousness caused by family presence.

Research limitations/implications

Although the case study method made it possible to acquire detailed knowledge about the firms' internationalization, the findings can be generalized only to some extent.

Practical implications

Managers of family SMEs and family members should be provided with the capacity to overcome distance‐creating factors, they might encounter in their FME. The decision to internationalize is a strategic change that will most probably change the historical harmony of the firm.

Originality/value

Prior research has mainly focused only on general internationalization pathways of family SMEs. In addition and contrast to the previous studies, this paper investigates the role of perceived psychic distance in family SMEs' FME and entry mode choice in a certain target market.

Details

Journal of Small Business and Enterprise Development, vol. 17 no. 3
Type: Research Article
ISSN: 1462-6004

Keywords

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