Small business growth and performance

Abstract

Research on business growth has blossomed, yet scholars often complain face the difficulty of distililing a clearer pitcure of the business growth phenomenon. This paper attempts to overcome this limitation by reviewing and synthesizing extant research on business growth. First, we begin by examining Penrose’s view of firm growth. Second, we highlight how business growth is measured; these are absolute or relative change and growth as a process. Third, we explore theories of business growth; integrated models-theories that explain the factors that drive business growth and (2) stage models which view business growth as a series of phases or stages of development through which a firm must pass in its life-cycle. Fourth, we examine modes of business growth; these are organic vs. acquisition growth, growth through networks and alliances and growth through internationalization. Fifth, we examine drivers and constraints to business growth. We conclude the review by pointing out areas of harmony and contention in the literature, from which we suggest opportunities for future research.