How can small firms mobilise and configure resources for better performance?
This project aims to better understand how small firms may mobilise and configure resources to achieve better performance, building on the resource-based view (RBV) of the firm.
Project overview
Small firms play a key role in national economies around the world. In the UK, for example, there are around 5.45 million small businesses (with 0 to 49 employees), accounting for 99.2% of the total business population (Department for Business & Trade, 2024). Small firms are also one of the predominant forms of enterprise in other OECD countries. While small firms can generate employment opportunities and are major contributors to value creation, they are more likely to experience resource constraints. They often have limited resources and capabilities to pursue strategic activities that may contribute to their performance. Therefore, the purpose of this project is to better understand how small firms may mobilise and configure resources to achieve better performance, building on the resource-based view (RBV) of the firm.
This project aims to address two research questions.
The first question explores how small firms use different resource mobilisation approaches (e.g., behavioural, and cognitive) to achieve better performance. Increasing research has highlighted that it is important for firms to pursue strategic activities such as innovation and sustainability. However, these resource-intensive activities may exacerbate the resource constraints often experienced by small firms. We contend that the performance implications of such activities will be contingent on how small firms use the different resource mobilisation approaches. This project will collect longitudinal survey data from small business owners from the UK to address the first research question. The target sample will be recruited through Prolific, an online crowdsourcing platform for research. The data will be analysed using fuzzy-set qualitative comparative analysis to identify the resource mobilisation approaches that can explain venture performance.
The second question explores how small firms may configure their portfolio of resources for venture growth. The RBV suggests strategic resources i.e. resources that are valuable, rare, and difficult to imitate or substitute (VRIN) allow ventures to efficiently implement strategies that protect them from imitation to secure and sustain competitive advantage. We distinguish strategic resources from versatile resources, i.e. resources that offer a broad range of potential services to ventures. We argue that firms need resource portfolios comprising strategic and versatile resources. Specifically, strategic resources and versatile resources will likely complement each other to explain venture growth. This project will use a 4-year longitudinal dataset consisting of 825 small ventures to address the second research question. The data will be analysed using fuzzy-set qualitative comparative analysis to identify the different resource portfolios that can explain venture growth. Given that ventures differ in their resource base, the findings from this project can offer important implications for entrepreneurs on how to configure their resource portfolio for venture growth.
