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Entrepreneurial configurations of small firms
Journal article   Open access   Peer reviewed

Entrepreneurial configurations of small firms

Margarietha J de Villiers Scheepers, Martie-Louise Verreynne and Denny Meyer
International Journal of Entrepreneurial Behaviour & Research, Vol.20(6), pp.562-583
2014
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url
https://doi.org/10.1108/IJEBR-09-2013-0135View
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Abstract

entrepreneurial configurations small firm configurations performance
Purpose: This article develops contemporary entrepreneurial configurations of small firms and relates them to performance. Adding a process dimension, we extend the more commonly used resource and growth taxonomies in this field of research. Design/methodology/approach: A review of current literature on small firm configurations is followed by a discussion of its dimensions, namely, context (external and internal environment), content (entrepreneurial orientation), and process (strategy-making). These are related to perceived performance, using cluster analysis and ANOVA for a sample of 320 small New Zealand firms. Findings: The results isolate young corporates, young simple, and mature consolidator clusters. Young corporates outperform their counterparts in dynamic environments in how they use formal structures, and their high entrepreneurial orientation and generative strategy-making. Research limitations/implications: This study uses self-reporting measures and a cross-sectional design. Practical implications: Our findings show how young, small firms can enhance their performance practically by aligning the key dimensions of an entrepreneurial configuration. These firms could benefit from early formalization of systems and structures, a high EO, and by using a generative strategy-making approach. Originality/value: Our contribution is threefold. First, we empirically verify the existence of three clusters of small firms and then link these to perceived performance. Second, by basing our small-firm configurations on a CCP framework, we highlight the importance of aligning these dimensions to performance. Third, we find evidence of the role of early formalization to accompany generative strategy-making and EO if small firms want to improve performance outcomes.

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