Strategic positioning and strategic types of small firms

Abstract

Purpose – The purpose of this paper is to study the strategic process of small- and medium-sized enterprises (SMEs) including strategic reference points (SRP) (Fiegenbaum et al., 1996). Design/methodology/approach – The paper identifies the strategic positioning of SMEs (Lavie and Fiegenbaum, 2000, 2003) according to the importance that their managers give to internal and external SRP. Their influence on strategic types (Miles and Snow, 1978) and performance are analysed. This study uses information, from 83 SMEs in the Canary Islands (Spain), collected with a questionnaire. Findings – SMEs are primarily adaptive firms followed by narcissist ones: numerous SMEs focus their attention on internal SRPs. SMEs strategic positioning determines their strategic orientations to a much lesser extent than their characteristics (sector, size and age) do. The results show that product specialisation, the only difference between adaptive SMEs and narcissist and amorphous ones, is not evident in their performance. Practical implications – Decision makers and institutions should reflect about the maturity of the strategic process and the adaptation dynamic of SMEs. The need for SMEs to focus on their external vision should be highlighted. Originality/value – The study includes SRP in the strategic process of SMEs. It contributes to the literature by drawing a map of the strategic positioning of SMEs, based on their SRPs (Lavie and Fiegenbaum (2000, 2003) and by linking the strategic positioning of SMEs with their strategic types. It also has the value of applying the Rasch Rating Scale Model (Andrich, 1978, 1988).

Three-Fold Embedding: Farm Development in Relation to Its Socio-Material Context

“…This allows for an in-depth empirical study of differences found between dairy farmers in their perception of opportunities. Studies of strategic decision-making in small businesses have revealed that the business owners' perception of opportunities is more decisive in the selection of a strategy than the formal analyses of opportunities [13,14]. For this reason, a better understanding of differences in the perception of opportunities is relevant.…”

Farmers’ perception of opportunities for farm development

“…The perception is found to be more important than a formal analysis (Parnell et al 2000;García-Pérez et al 2014). The perception of opportunities is influenced by dominant paradigms, lock-in effects and path dependencies (Vanloqueren and Baret 2009;Lamine et al 2012;Cowan and Gunby 1996).…”

“…This allows for an in-depth empirical study of differences between dairy farmers in their perception of opportunities. In the study of strategic decisionmaking in small business, the perception of opportunities is found to be more decisive for the outcome than the formal analyses (Parnell et al 2000;García-Pérez et al 2014).…”

“…The personal characteristics of the business owner are known to be an important factor to explain the heterogeneity in small business (Jocumsen 2004;Liberman-Yaconi et al 2010;Hang and Wang 2012). The small business owner's perception of opportunities is found to be more decisive for the outcome of SDM than formal analyses (Parnell et al 2000;García-Pérez et al 2014). The perception is influenced by dominant paradigms, lockin effects and path dependencies (Vanloqueren and Baret 2009;Lamine et al 2012;Cowan and Gunby 1996).…”

“…Looking more closely at SDM in the context of small business, it is known to be an iterative process of informing, option generating and deliberating that starts at the moment decision-making is triggered (Jocumsen 2004;Liberman-Yaconi et al 2010;Hang and Wang 2012). The small business owner's perception of the situation has been found to be more decisive for the outcome of SDM than formal analyses (Parnell et al 2000;García-Pérez et al 2014). The perception of entrepreneurial opportunities is affected by the environment in which a small business operates (Sutcliffe and Zaheer 1998;Yanes-Estévez et al 2010).…”