Strategic initiatives and small business performance: an exploratory analysis of Irish companies

Stephen Roper

Entrepreneurship & Regional Development, 1997, vol. 9, issue 4, 353-364

Abstract: Using information provided by over 450 small firms throughout Ireland this paper examines the links between firms' strategic initiatives and their growth, profitability and asset utilization. Strategy choice is found to have an important and significant link to business growth and profitability but no significant link to asset utilization. Growth and profitability linkages, however, often operated in opposite directions. For example, strategies designed to centralize the ownership or control of sample businesses were positively associated with business growth but had negative profitability links. Similar results were evident for a number of market and systems strategies. The implication is that the appropriate strategy choices for a firm depend strongly on the firm's business priorities. The strongest growth associations were with the introduction of management accounting systems, the introduction of new or improved products and moves to centralize ownership. For businesses with broader development objectives, new product development, export market development and moves towards more consensual managerial approaches had positive profitability, growth and asset utilization links.

Date: 1997
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DOI: 10.1080/08985629700000020

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