Strategic Planning Approaches in Greek SME’s

Abstract

Numerous articles in academic publications as well as practitioner-oriented journals have emphasized the importance of strategic planning, not only for large firms but for small businesses as well. However, research findings regarding planning come principally from industrialized countries characterized by big conglomerates, creating models and frameworks, which are not necessarily appropriate for specific cultural and national environments. Given that small firms are considered to be one of the principal driving forces of the Greek economy, a growing amount of research attention devoted to indigenous SMEs would have been expected. Nevertheless, there is little or no empirical data concerning the diffusion and practice of strategic planning within Greece. This study, through a research based on a random sample of 30 Greek small-medium companies, investigates the use and nature of strategic planning adopted by the Greek SMEs and aims to develop a more complete picture of their planning practices. The main findings of the study derive from a model that incorporates a number of dimensions like the organizational characteristics of the firm-age, size (i.e. Ibrahim, Angelidis & Parsa, 2004), its strategic posture (i.e. Covin & Slevin, 1989), the type of ownership (i.e. Upton, Teal & Felan, 2001), and individual characteristics such as owner’s age, gender, and education. These are associated with the level of planning sophistication (i.e. Bracker & Pearson, 1986), business objectives (i.e. Rue & Ibrahim, 1996) and performance (i.e. Venkatraman & Ramanujam, 1986). Furthermore, the paper reports the results of the study, highlighting the extent to which Greek family or non-family owned small firms engage in entrepreneurial activity via strategic planning. It has been suggested that family owned small firms - the vast majority of Greek SMEs - do not adopt strategic plans, despite their entrepreneurial orientation. Finally, the paper contributes to the existing literature on planning diffusion by discussing sophistication, formulation and effectiveness of strategic planning in Greek SMEs.