of Entrepreneurship Research
AN EMPIRICAL ASSESSMENT OF FACTORS INFLUENCING THE GROWTH OF AUSTRALIAN SMALL AND MEDIUM-SIZED ENTERPRENEURIAL VENTURES
1L Murray Gillin
1Swinburne University of Technology
Hawthorn, Victoria, Australia 3122
2VME Systems Pty Ltd.
Burwood, Victoria, Australia 3125
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The growth rates for 110 Australian entrepreneurial companies and identified in the years 1994, 1994 and 1996 were studied. 64 of these fast growing companies were identified initially in terms of sales growth and 46 identified initially in terms of management practice. The characteristics of the growth rate were examined overall, by management competency, by growth performance, by maturity of products and services, by perception and response to business environment, by recognition of business, by strategic intent and access to capital.
The questionnaire was sent to the 1996 Business Review Weekly, Price Waterhouse fastest growing 100 private companies and the 80 companies in the 1994 and 1995 Telstra Small Business of the Year award winners. These two groups were chosen because the enterprises are identified as high achievers but also reflect different categorizations. A 122 point questionnaire was developed using a combination of original and adopted questions from previous studies. The questions covered 6 main areas: reason for starting the venture; strategy; management; environment; barriers to growth and future plans for the venture.
Lack of venture finance has not held back the growth of these companies. Over fifty percent started their venture with less than $20,000. They all learnt to manage the cash flow. Over seventy percent have written business plans and either have, or are in the process of obtaining ISO 9000 type quality certificatio0n. Marketing skills were rated more important than leadership. In particular conventional education appears not to be valued by those seeking high growth businesses. Previous entrepreneurial experience is more important. They were also outward looking, emphasize performance management over simply people management and focus on developing new products.
Effective entrepreneurial education needs to be introduced early in the school curriculum. Management education should incorporate more emphasis on experiential learning. Successful product development is characterized not by more $ & D but being early to market with proven distribution channels.
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Last Updated 04/25/98