Overview
- Challenges conventional biases in research, practice, and policymaking concerning the correlations among business growth, innovation, and profitability
- Considers the strategic, financial, and organizational issues associated with generating and sustaining business growth
- Includes case examples from such industries as airlines, accounting, biotechnology, IT, and wineries
- Includes supplementary material: sn.pub/extras
Part of the book series: SpringerBriefs in Business (BRIEFSBUSINESS)
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Table of contents (8 chapters)
Keywords
About this book
In this volume, the authors challenge some long held assumptions about entrepreneurial firms held by academics, public policy makers, investors and even entrepreneurs themselves. The first is assumption is that growth is what really differentiates an entrepreneurial firm from a small business. The second is that growth is always good. Third, if growth is rapid, and/or high growth, it is even better.
Drawing from a fresh review of the literature, their own primary research and experience in entrepreneurial ventures, the authors argue that the relationship between growth and firm performance is, in fact, inconclusive. Despite the strength of contemporary bias, there is strong evidence that the growth-profitability relationship is problematic. For example, rapid growth may lead to considerable organizational challenges that can seriously constrain a firm’s ability to generate sustainable profits. Also, it is not uncommon that a growth firm becomes a victim of its own success.
Using examples from industries as diverse as airlines, accounting, biotechnology, information technology, personal products, wineries, and food establishments, the authors highlight limitations to research due to variations in the choice of growth indicators, the calculation of growth measures, the measurement periods, and whether objective or subjective measures have been used. Moreover, researchers have equated growth with high growth and almost automatically assumed that this also means high technology, while policy makers appear to have interpreted this as high employment.
Armed with more precise definitions and understandings of key concepts and the nature of their causality, the authors consider the implications of restoring profitability to the core of entrepreneurship for future research, firm strategy, financing, organizational structure, resource allocation, and public policy.
Authors and Affiliations
Bibliographic Information
Book Title: Understanding the Myth of High Growth Firms
Book Subtitle: The Theory of the Greater Fool
Authors: Malin Brännback, Alan L. Carsrud, Niklas Kiviluoto
Series Title: SpringerBriefs in Business
DOI: https://doi.org/10.1007/978-1-4614-9457-7
Publisher: Springer New York, NY
eBook Packages: Business and Economics, Business and Management (R0)
Copyright Information: The Author(s) 2014
Softcover ISBN: 978-1-4614-9456-0Published: 07 November 2013
eBook ISBN: 978-1-4614-9457-7Published: 08 November 2013
Series ISSN: 2191-5482
Series E-ISSN: 2191-5490
Edition Number: 1
Number of Pages: V, 116
Topics: Entrepreneurship, Business Strategy/Leadership, Organization