To grow or not to grow: the effects of strategy making process on small firm performance

Growing small firms is critical to any economy. The factors leading to growth have been the subject of many studies, and this paper continues in that tradition. It investigates how one factor which has not received much attention in this regard, namely the strategy-making processes that a small firm uses, may influence its ability to grow. To this end this paper describes the results of an empirical study conducted with 454 small firms. Several important findings emerge from this study. Most importantly, several strategy-making processes, in particular participative strategy-making, have the ability to influence growth. Adaptive and intrapreneurial strategy-making also influence growth through their impact on entrepreneurial orientation, which has a significant impact on growth, especially in young firms.