This work package analyses the drivers and barriers to growth in SMEs by exploiting existing data on entrepreneurial growth ambition and realised growth. Insufficient research on contextual influences is also a big gap in the understanding of entrepreneurial growth and so empirical work in this theme explores both contextual, firm and individual-level drivers and barriers to entrepreneurial firm growth within the GEDI framework.
Initial research within this theme focussed on a systematic literature review of the determinants of entrepreneurs’ growth ambition.
Key Research Findings
- Business leaders’ growth intentions and ambitions are strongly linked to realised growth. Levels of ambition and growth focus really matter in smaller and mid-sized companies.
- Growth intentions are associated with a range of individual (age, education, experience) and firm (age, size, technology) level factors. Growth intention itself shapes strategy choices such as export orientation.
- Aspects of the business environment (e.g. regulation) can also strongly influence growth intention and can be influenced by policy action.
- These features of the business environment can be combined with individual data to provide an overview of the National Systems of Entrepreneurship – the GEDI framework. The distinctive features of this methodology are: (1) systemic approach, which allows interactions between components of National Systems of Entrepreneurship; (2) the Penalty for Bottleneck feature, which identifies bottleneck factors that hold back system performance; (3) contextualization, which recognizes that national entrepreneurship processes are always embedded in a given country’s institutional framework.
- Application of the GEDI framework to Scotland has suggested the main bottleneck in terms of entrepreneurial activity in Scotland are aspirations by individuals.
Growth and Growth Intentions (White Paper No 1)
This white paper summarises what we know about the connection between entrepreneurs’ growth intentions and realised enterprise growth.