Identifying high growth firms: Where are we?

Abstract

The article reviews the literature for the key markers of high growth firms, which create the majority of new jobs. From the review, a template is developed comprising the key markers. They include: training and experience in entrepreneurship and management; and strategies that emphasise innovation, marketing and employee and organisational learning. High growth firm owners take steps to access management skills that complement theirs through employment of a management team, outsourcing management tasks or making decisions with oversight from an informal board. Good reward structures, which may include ownership interests, are essential to performance of the management team. Access to resources, especially finance and human capital is critical to growth but abundant resources could compromise efficiency. The article finds that personality characteristics of owners and postgraduate education in management are not effective identifiers of high growth firms. Some of the barriers to identifying high growth firms are presented and suggestions made to overcome them.

Impact of high‐growth start‐ups on entrepreneurial environment based on the level of national economic development

“…Gazelles are the most dynamic sector of economy (Acs & Mueller, 2008) and are generally related to dynamic high-technology sectors (Daunfeldt, Johansson, & Halvarson, 2015;Dwyer & Kotey, 2016).…”

Bangladesh Jobs Diagnostic

“…It is also critical for the creation of better quality jobs. While there remains some debate on which types of firms create the most jobs-microenterprises versus large establishments, newly created versus old enterprises-the literature has come to some consensus on the importance of young, dynamic, high-growth enterprises (sometimes referred to as "gazelles"), even if there is no agreement on how to identify these firms ex ante (see Audretsch 1995;Dwyer and Kotey 2016;McKenzie 2015). However, there is little debate that productivity enhancement of firms, of all ages and sizes, matters greatly for the delivery of sustainable, quality jobs.…”

SME corporate governance: a literature review of informal mechanisms for governance

“…Several practical and policy implications can be drawn from our study. Our findings uncover a variety of mechanisms used that afford SME access to skills and resources traditionally generated by CG, such as networks, capital providers and professionals such as accountants and solicitors (Baker and Nelson, 2005; Dwyer and Kotey, 2016). Because SMEs may lack the requisite skills and resources to develop their own alternative CG structures, policymakers could look to create regionally located “pools” of resources that might be accessed by SMEs.…”

“…Given these gaps, this study explores the notion that the SME governance literature may be too narrow and does not allow for investigation of more innovative governance models suitable for SMEs. While boards determine strategic direction and can impact value creation, a lack of access to human capital in SMEs means they are unable to create sufficient skill diversity within their boards of directors (Ruef et al , 2003), which may need to be sourced outside of the company to facilitate growth (Dwyer and Kotey, 2016). Saxena and Jagota (2015, p. 55) call for “articulation of governance outside the firm” with a sociocratic model (Saxena and Jagota, 2016) that holds the locus of governance in clusters, industry associations and development agencies.…”