Abstract

Firm growth is an important indicator of a thriving economy. Although the determinants of firm growth have been studied in various disciplines, an integrated analysis is still lacking. Many determinants of firm growth are summarized and classified into three dimensions: individual, organizational, and environmental determinants. The present paper attempts to provide an integrated analysis on the determinants of firm growth. It gives an opportunity to investigate the determinants of firm growth in a comprehensive way.
 The close-ended questionnaire was developed from standard questions of relevant literature as a research instrument. The sample size taken for the research is of 110 IT firms entrepreneurs.
 Among the individual determinants, need for achievement, risk taking propensity and self-efficacy are positively conducive to firm growth. Among the organizational determinants, formulation, preparedness to grow, organizational learning, financial performance have positive impacts on firm growth. Market orientation, Entrepreneurial orientation, competitive intensity shows a negative relationship. Among the Entrepreneurial determinants, munificence, heterogeneity has positive impacts on firm growth. Market dynamism shows a negative relationship. Growth Barriers shows negative relationship.
 Our study shows that firm growth is a complex phenomenon. It cannot be explained by one particular dimension or one determinant. The most important determinants have been identified from the individual, environmental and organizational dimensions. Organizational determinants have the greatest influence on firm growth.

Highlights

  • Entrepreneurship is crucial to increasing productivity, competition, and innovation; is valuable to an economy and its participants (US, Office of the Press Secretary, 2003); creates thousands of jobs each year (Morris & Kuratko, 2002); and increases prosperity and revitalizes communities

  • Our empirical results show a positive relationship between growth motivation and firm growth

  • It has been argued that a motivated entrepreneur will perform better in firm growth since he/she will devote more time and energy

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Summary

Introduction

Entrepreneurship is crucial to increasing productivity, competition, and innovation; is valuable to an economy and its participants (US, Office of the Press Secretary, 2003); creates thousands of jobs each year (Morris & Kuratko, 2002); and increases prosperity and revitalizes communities. In India the term entrepreneurship connotes a restricted meaning. It generally veers round efforts which result in establishing and running factories and industrial enterprise alone. Harbinsen (cited by Singh 1992) defines entrepreneurship as a skill to build an organization. He spots the crux of entrepreneurship in the ability to multiply by effectively delegating responsibilities to others. He further stresses that the ability to create an organization is the most crucial skill as it facilitates the economic use of other innovations and that in the absence of this skill other innovations fail to stimulate economic development

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