Small business strategy
: an empirical analysis of the experience of new Scottish firms

  • Julia Smith

    Student thesis: Doctoral Thesis


    This thesis aims to make a significant contribution to the development of the emerging literature on small business strategy. First, it conducts a critical review of the existing literature on strategy in general, and its relation to small firms in particular. Second, it investigates whether or not small firms do make strategic decisions, and discovers how these are incorporated into their long-term plans. Third, it establishes a link between the strategies employed by new small firms and their subsequent performance. And finally, it advises on the strategies and actions a small business should follow if it wishes to achieve high performance. As such, the work should be useful, not only to academics with an interest in new small firms, but also to practitioners and small business advisors.

    The thesis explains how two fieldwork instruments were designed, for use in face-to-face interviews with the owner-managers of 150 young micro-firms throughout Scotland, over a two-year time period. This work led to the design and development of a new database, and the creation of 17 case studies on small business strategy. Cluster analysis was used to group the firms into high, medium and low performance categories. Then strategies followed by each performance category were analysed to discover why some were more effective than others. The case study evidence was used to support this analysis, further augmented by statistics from the administered questionnaire.

    Seven propositions were developed, and empirically tested. O f these, the most notable were that: first, higher performers appear to have a better appraisal of their own strengths and weaknesses, as well as being more aware of opportunities and threats, compared to the lower performing firms; second, the implementation and continued use of information-technology has a statistically significant and positive effect upon performance; and third, the gathering of trade intelligence (e.g. marketing, quality) on rivals appears to enhance performance. Further propositions, on awareness, funding and ownership, round off the detailed picture provided of performance in the new small firm.
    Date of AwardAug 1997
    Original languageEnglish

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