Inducements,Impediments, and Immediacy: Exploring the Cognitive Drivers of Small Business Managers' Intentions to Adopt Business Model Change

Small business managers rely on judgment and heuristics when making critical strategic decisions. We explore this phenomenon, expanding the theory on cognition and strategy to explain the cognitive determinants of strategic decisions leading to small firm business model change. We integrate existing theories (entrepreneurial opportunity exploitation, cognitive resilience, prospect theory, behavioral theory of the firm, threat‐rigidity) into a framework explaining strategic intentions, based on managers' perception of business opportunity interacting with assessment of the external environment, current performance, and prior experience. The framework is empirically tested in the context of Canadian real estate brokerage industry, facing potentially major disruptive change.     

Size,Age and Activity Sector on the Growth of the Small and Medium Firm Size

Although corporate growth is one of the most researched subjects in different areas of economic science, it is not currently based on a general theory or generally accepted conceptual definition. In spite of this, growth has usually been considered an essential objective for a firm, contributing to its survival and competitiveness. This work aims to provide a more in-depth study of the factors that condition the growth of small and medium-sized firms, by offering some empirical evidence that will contribute to its modelling, especially in relation to the influence of size, age and activity sector. In this context, we shall attempt to contrast the validity of Gibrat's approach and the Learning Theory.     

Small Firm Finance, Credit Rationing, and the Impact of SBA-Guaranteed Lending on Local Economic Growth

Increasingly, policymakers look to the small business sector as a potential engine of economic growth. Policies to promote small businesses include tax relief, direct subsidies, and indirect subsidies through government lending programs. Encouraging lending to small business is the primary policy objective of the Small Business Administration (SBA) loan-guarantee program. Using a panel data set of SBA-guaranteed loans, we assess whether or not SBA-guaranteed lending has an observable impact on local economic performance. We find a positive and significant (although economically small) relationship between the relative levels of SBA-guaranteed lending in a local market and the future per capita income growth in that market.     

Small Firm Bankruptcy

From the results of a survey we compare the demographics and potential problem situations of 57 bankrupt firms to 55 nonbankrupt firms in an attempt to identify root causes of bankruptcy. Results indicate that the most serious problems of bankrupt firms can be condensed into three categories: lack of knowledge, inaccessibility to debt, and economic climate. Bankrupt firms also appear to be older, more likely to be in the retail industry, and organized as proprietorship or partnership than nonbankrupt firms. They are also less likely to use the Internet in their business operations than the nonbankrupt firms. One surprising finding is that while both subsamples found knowledge important, the nonbankrupt sample found it significantly more important than the bankrupt firms. This evidence provides insights for governments and academic institutions in their efforts to provide resources that may help reduce the incidence of bankruptcy, especially during times of declining economic health.     

Internationalization, Strategic Behavior, and the Small Firm: A Comparative Investigation

Previous research on the internationalization of the small firm explored the relationship between the adoption of a global orientation and strategic thinking. However, there was difference in opinion between those arguing that there is a positive relationship between the two variables and others who contended that small firms may internationalize by adopting a passive or reactive approach to the external environment. Within this context, this study sets out to further the discussion by comparing the experience of small enterprises with their medium and large-scale counterparts. In doing so, it draws upon the findings of survey of 1,000 internationalized enterprises located in the main urban conurbations of England. The results suggest that overall there is little disparity in strategy development among internationalized enterprises of different sizes. However, whereas the incidence of strategic behavior among medium and large businesses increases with the complexity of international operations, this is not the case for small firms.     

Managerial Behavior, Entrepreneurial Style, and Small Firm Performance

Considerable effort has been devoted to identifying the general characteristics of entrepreneur; however, much of this has been conducted from a trait–based rather than from a behavioral perspective. In this study of small firms in the United Kingdom, we explored the relationships among managerial behaviors (based upon a competence model), entrepreneurial style (based on Covin and Slevin's theory), and firm type (in terms of sales growth performance). Principal components analysis of a management competence inventory identified six broad categories of managerial behavior. Regressing a measure of entrepreneurial style on these six behaviors suggested that managing culture and managing vision are related to an entrepreneurial style, while managing performance is related to a nonentrepreneurial style. Entrepreneurial style—but not managerial behavior—was associated positively with the probability that a firm would be a high–growth type. The results are discussed from the perspective of a model of small firm management that posits separate entrepreneurial, nonentrepreneurial, and generic management behaviors derived from a global competence space.     

Moral Hazard,Agency Cost,and Firm Growth

We study how the agency cost implied by the moral hazard problem in a firm dynamics model affects the life cycle growth pattern of firms. In the early stage of a firm's growth, the agency cost restricts the firm's capital input and diminishes over time, so that the firm's growth is driven by efficiency improvements and an exogenous progress in productivity. In the long run, when the firm loses its potential to improve efficiency, growth is driven only by the progress in productivity. As a result of this growth mechanism, consistent with the data, the growth rate and its volatility, as well as Tobin's Q, decrease with age and size. Moreover, the cross‐sectional distributions of firm size and managerial compensation obey a power law, as they do in the data. In addition, the model provides novel implications for how the characteristics of the production technology and the preferences of the economic agents affect the growth pattern of firms, and these implications are potentially testable.     

An Empirical Investigation of the Growth Cycle Theory of Small Firm Financing

This paper empirically tests the financial growth cycle model for small and medium-sized enterprises (SMEs), which postulates that as firms become larger, older, and more informationally transparent, their financing options become more attractive. We add to the literature by providing one of the first empirical tests of the model using a large, cross-sectional data set. Our results partially support the financial growth cycle model. Specifically, our results show larger firms, as measured by total number of employees, are more likely to use public equity funding or long-term debt as opposed to insider funding.     

The Small Accounting Firm

No abstract available for this article.     

Supplier Partnerships and the Small, High-Growth Firm: Selecting for Success

Strategic partnerships are commonplace in today's global economy. Effective use of partnerships are viewed increasingly as an important issue facing small, growth-oriented firms. A key debate is how small firms should manage supplier partnerships. Contrasting the debate about the extent to which small firms are inertial versus adaptive, the impact of growth on value chain partnerships with suppliers was investigated. Data collected from 91 pharmaceutical-related firms is used to test the proposition that firm growth is related positively to maintaining or to expanding relationships with suppliers, not to terminating partnerships. The paper further posits that this relationship between firm growth and the amount purchased from a supplier is moderated by the perceived effectiveness of the value-chain partnerships such that when effectiveness is higher, the relationship between sales growth and the amount purchased from a value-chain partner is stronger. The propositions, which are tested with regression analysis, are supported partially.     

Mobile Shoppers: Types,Drivers, and Impediments

The technology adoption of mobile commerce has frequently been studied by considering the extended technology acceptance model (TAM). However, the role of the perceived drivers and impediments affecting potential mobile shoppers' acceptance has been scarcely analyzed. This article highlights: (1) the typology of potential m-shoppers described by their reasons for, and perceived impediments to, mobile shopping and (2) the possible differences in the extended TAM in the resulting categories. In order to do so, we advance a single hypothesis about moderation of the m-shopper type on the relationships presented in the extended TAM. The study was conducted in Spain, a country with significant current and forecasted use of mobile shopping. Data from 476 Spanish mobile phone users were analyzed. The use of latent class cluster allowed us to identify three types of mobile shoppers that show different profiles based on their perception about drivers and impediments. Differences in the extended TAM relations across the clusters were identified using the multigroup approach of structural equation models. The results show support for the moderation effect, providing valuable information for practitioners to understand how consumers develop mobile shopping intentions, which is necessary to implement effective marketing strategies.     

CEO Regulatory Foci,Environmental Dynamism,and Small Firm Performance

This research proposes and tests that regulatory foci of small business chief executive officers (promotion focus and prevention focus) relate to firm performance differentially when levels of environmental uncertainty vary. Results suggest that a promotion focus is positively related to firm performance, whereas a prevention focus is negatively related to firm performance. Further, these relationships are moderated by the degree of environmental dynamism such that in more dynamic environments, the relationship between promotion focus and firm performance is strengthened, whereas the relationship between prevention focus and firm performance is negatively affected. The reverse was found for less dynamic environments. Theoretical and practical implications as well as future research avenues are offered.     

Small Firm Survival and Technological Activity

The paper investigates the post entry performance of small firms competing under different technological environments. Small firm survival is compared over technical and non-technical products and over stages of differing technological activity. The empirical results, in the context of the product life-cycle framework, show that small firms enjoy a higher probability of survival in stages of high technological activity, and in products that are more technical in nature. Technological activity is also seen to affect the shape of the hazard rate function, implying that the relation between technological activity, age and small firm survival may be complex.     

New Technology and The Small Firm

This paper examines how and why the role of small business has become more important over time. A special focus is placed on the role of small business in the New Economy.     

SME Policy, Financial Structure and Firm Growth: Evidence From Japan

This paper investigates the effects of public policy and financial structure on the growth of small and medium enterprises (SMEs). Using a panel data set on SMEs in the Japanese manufacturing industry, we examine whether or not the SME Creative Business Promotion Law (CBPL) and financial structure affect firm growth. It is found that SMEs approved by prefectural governors under this law tend to increase assets. Further, we provide evidence that the CBPL and cash flow have an impact on the growth of younger SMEs.     

Factor Substitution, Average Firm Size and Economic Growth

This paper extends the Lucas (1978, The Bell Journal of Economics 9(2), 508–523) analysis of firm size by taking into account a normalised aggregate CES production function. In a general equilibrium framework it is proved that there is an inverse relation between the elasticity of substitution and average firm size. If interpreted together with the fact that richer countries are characterised by a higher elasticity of substitution, this result can explain why the recent literature finds a positive association between the importance of SMEs in an economy and its stage of development, but seems to fail in finding causality between the two. Both have a common origin: a high value of the elasticity of substitution. This paper also provides a first empirical test of the theory proposed using cross-country data from both developed and developing countries.     

Small Firm Statistics: A Hotel Sector Focus

This article contrasts and compares statistics from the UK small firm sector in general with those related to small firms within the hotel industry. In doing so, it is clearly illustrated that there is a need to focus research, resultant policy and strategy on the specific issues facing small firms at a sub-sector level, rather than assuming a homogeneity of the small firm population in general. The paper concludes that the plight of the small firm operating within the hotel industry is dire and questions what the future holds.     

Accountants and Small Firm Development: Filling the Expectation Gap

As a supplier of rzecessaty expertise, the professional accountantis in a potentially strong position to influence the small business.Previous research indicates, howevec that the injluence of theaccountant on the performance of the smallfirm is limited. Thispaper examines the relationship between small firms and theaccountancy profession in the North East of international. It is basedon two surveys of 31 small businesses and 33 accountancypractices. It reveals a mismatch in the expectations of the twogroups- and argues that if the accountancy profession is to fulfilits potential in assisting small firms develop and improve theirmanagement capability, changes are required in the wayaccountancy services are marketed and provided.     

Small Firm Dynamics: Evidence from Africa and Latin America

This paper investigates the determinants of survival and growth among small and very small enterprises in Africa and Latin America. Location is found to be an important factor. Firms located in urban and commercial areas are more likely to survive during a given year than those located in rural areas or those being operated out of home. Urban and commercial location is also associated with faster growth, as measured by the number of employees hired in a given year. Studies are also cited to show that human capital matters, especially when it is in the form of vocational training or prior business experience.