1. Delmar, F., Davidsson, P., & Gartner, W. B. (2003, Mar). Arriving at the high-growth firm. Journal of Business Venturing, 18(2), 189. Flashcards
What evidence does this article present to suggest that there is no single “one best way” of measuring firm growth?
The article presents evidence that firm growth is a highly heterogeneous phenomenon, which suggests that there is no single “one best way” of measuring growth.
How can recognizing the multidimensionality of growth be beneficial for both researchers and practitioners?
Recognizing the multidimensionality of growth can be beneficial for both researchers and practitioners because it allows them to better understand the different growth patterns of firms and to identify opportunities for growth.
What factors were found to have a strong relationship to the differences among the clusters identified in the study?
The study found that firm size and age, and industry had a strong relationship to differences among the clusters and that ownership (governance) had a moderate relationship to the seven growth patterns.
What is meant by the phrase “high-growth” being multidimensional in nature?
The phrase “high-growth” being multidimensional in nature refers to the fact that there are many different types of high-growth firms with different growth patterns and characteristics.
What is the difference between absolute and relative growth measures?
Absolute = real numbers
Relative = percentages
What are some important features of organizational growth?
Important features of organizational growth as a phenomenon are: the variation in measures used in studies, the variation in growth indicators, the variation in the measurement of firm growth over time, the variation in the processes by which firm growth occurs and the variation in characteristics of these firms and their environments.
Why is the choice between absolute or relative growth important for the relationship between size and growth?
The choice between absolute or relative growth is important for the relationship between size and growth because absolute measures tend to ascribe higher growth to larger firms whereas smaller firms more easily reach impressive growth in percentage (relative) terms.
What are some of the variations in the processes by which firm growth occurs?
Variations in the processes by which firm growth occurs include organic growth and acquisitions
What is the most preferred measure of firm growth?
The most preferred measure of firm growth is sales.
What are some other common growth indicators?
Other common growth indicators are assets, employment, market share, physical output, profits and sales.
Why is sales the most preferred measure of firm growth?
Sales is the most preferred measure of firm growth because it is accessible, applicable to all firms, and relatively insensitive to capital intensity.
What are the drawbacks of using sales as a measure of firm growth?
The drawbacks of using sales as a measure of firm growth are that it is sensitive to inflation and currency exchange rates, and it does not always lead to growth.
What are the advantages of using employment as a measure of firm growth?
The advantages of using employment as a measure of firm growth are that it is not sensitive to inflation and currency exchange rates and it might be preferable if the focus is on managerial implications of growth.
Do sales always lead to a growth process?
No they do not.
What are the implications of organic vs. acquisition growth for firms?
The implications of organic vs. acquisition growth for firms are that organic growth is more likely to represent genuine job creation and is more smooth than acquisition growth.
