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Firm strategies and performance
Scope of the firm strategies and performance research program
- Shows that new small firms play an important role in shaping the
evolution of the industrial landscape. Over time, the turnover within
industry populations generated via successive entry cohorts is dramatic.
Industries exist in a constant state of competitive turbulence - one
that is shaped by the emergence, growth and decline of small firms.
- Examines the survival profile of new small firms showing that they
face high rates of infant mortality. The size advantages that some young
firms develop over others are strongly correlated with success, and
mirror the development of a whole host of firm-specific competencies. It
also examines the causes behind failure. Small firms fail because they
lack basic business skills-notably in areas related to management and
- Examines the characteristics that are peculiar to successful small
firms-those that survive and grow. It is demonstrated that they pursue a
wide array of innovation strategies, and often develop a supporting
network of complementary business skills. There is no single archetype
that adequately summarizes innovation in small firms. Research,
technology adoption, human resource skills, marketing, financing and
management all contribute, in varying degrees, to growth and
performance. Innovative firms are compleat firms in that they have to
develop a range of competencies to succeed. This is true both for more
recent entrants and for small and medium-sized incumbents.
- Illustrates that innovation strategies are often tailored to the
specifics of an industry's environment. An industry's science base
affects the nature and intensity of a firm's investments in knowledge,
as do changes in the competitive pressures that small young firms face.
- Shows more innovation is typically associated with the more
successful firms. High-performance firms are often those that make
significant investments in knowledge; what is more, they are often
compleat firms-they take on many activities and excel in numerous areas.
Success is borne out of activity, not just by random chance.
- Illustrates that the innovative sector depends heavily on a
particular type of finance-equity capital. And firms that downplay
equity are less likely to perform R&D and consequently to be
and description of publications