Nogare, LD 2006, 'Grow or go: a theory-building study regarding the survival and growth of micro-small enterprises: action-oriented research conducted at Werbedruck Petzold, Gernsheim, Germany' , PhD thesis, Southern Cross University, Lismore, NSW.
Copyright LD Nogare 2006
In general terms, this research project evolved in response to my desire to find out more about the planning issues faced by micro to small-sized enterprises (MSEs). In particular, how they plan for survival and growth.
As such, the main objective of the action oriented research project is to assess the viability of developing a framework which will be capable of providing structured, useful and relevant guidance to micro to small-sized enterprises (MSEs) in terms of business survival and growth. In a practical sense, it is important that the framework is also flexible enough to deal with the complexity and fluidity of the real life business environment within which MSEs operate.
A review of current growth theory and the current available data and tools aimed at assisting MSE in the area of growth planning is presented in chapter two. This review serves to highlight two important issues which, in turn, guide the research project.
- Firstly, an attempted review of current statistical information regarding MSEs highlighted a serious lack of general planning data for this sector within Europe. (Statistics are only analysed and reported for companies with over 20 employees)
- Secondly, extant literature regarding growth theories for MSEs, fails to provide one perfect solution. There is a general consensus that it is neither possible, nor desirable, to try to develop one single and fixed model to predict company growth.
Chapter two also provides a review of associated disciplines which are closely related to MSE planning ie entrepreneurship, innovation, and complexity. This extended review shows that flexibility and adaptiveness have a great impact on business decisions regarding company survival and growth and further strengthen the case for a flexible solution. Through consideration of these related topics the following three concepts are brought to the fore and are subsequently integrated into the final response to the research questions:
- inherent company leadership,
- the influence of the external environment and the opportunities and threats it presents to a MSE,
- the internal factors which impact MSE company operations and decisions
As such, Chapter two highlights the need for a bespoke solution which is both reactive and conditional. In order to focus the project, several delimitations were introduced.
- Geographically, the research was based upon the prevailing conditions for German and central European MSEs.
- Furthermore, a single case study company was selected as it suited the participative requirements of the project. The company is a micro-sized offset printing house.
- As the project advanced, it became clear that decisions regarding company survival and growth for MSEs varied greatly depending upon the stage of operations in which the company found itself. Thus, a more specific focus on mature MSEs was adopted as the project and research progressed.
By placing these three restrictions on the research project it was possible to conduct meaningful action-oriented research, aimed at generating future action and change beyond the study, as well as identify and address a very specific set of research problems, namely:
How can managers of mature micro to small-sized offset printing plants in German/central Europe plan for survival and grow into the future?
a. Can a management decision tool be developed to assist this decision and growth process in the mature company?
b. How would such a tool be formulated to ensure both effectiveness and acceptance? (what factors should it consider)The key concepts introduced via the extant literature were then integrated into a soft systems review, supported by action-oriented research, in an effort to develop a flexible framework aimed at addressing the research problems.
Several phases of research serve to support and build upon, or refine, one another to establish a more relevant and meaningful solution. A preliminary research phase comprising a Delphi study and convergent interviews was supported by group feedback sessions conducted with a small work group from the case study company – Werbedruck Petzold. The work group reviewed aspects of the developing framework at various stages throughout the project; each time participants were able to refine concepts and enhance the response to the main research problem. Chapters three, four and five present this conceptual development and testing/evaluation process. They also highlight the robustness of the data stemming from repetitive cycles and triangulation techniques integrated into the research design.
The ultimate contribution to knowledge which evolved from the action-oriented research is presented in the form of a three-step framework which acknowledges
- the overriding and inherent wishes of the MSE’s owner/manager
- the opportunities and threats posed by the external environment, and
- the mix of functions each MSE must develop to meet its own specific goals, given its own environmental situation.
It is important to note that the response to the research problem is not a fixed model which can be systematically applied to all MSEs. But is rather a flexible framework which is intended to be actioned by MSEs, given their own situations and goals. The key to the proposed framework is that it must be continually reviewed to reflect the ‘current reality’ of a MSE. It is basically a framework which has been developed via action oriented research techniques and is intended for ongoing case-specific, action, review, and refinement. It represents a shift in growth theory for MSEs as it embraces and promotes contingency, thus better reflecting the reality of MSEs.