Fighting Scaling Challenges With Internal Means: A Paradox

Abstract

While high-growth firms are important providers of innovation, employment, and wealth, it is not clear how a young firm’s top management team navigates the process of scaling their business into such a firm. One particular challenge young firms must learn to overcome if they want to grow is the ‘people’ challenge. This paper studies the boundary conditions of the adoption of high-performance work practices as a means to help overcome the growing pains of these firms. Building on the attention-based view, we show that the adoption of these practices uncovers a paradox which is subject to the influence of financial performance and the team’s previous entrepreneurial experience.