Motivation of small business managers affects firm growth

Jun 05, 2008

Economic theory often assumes that firm growth is automatic, given the existence of growth opportunities in the marketplace. However, a new study published in Entrepreneurship Theory and Practice reveals that the motivation of small business managers has a long-term effect on the actual future growth of the firm.

Researchers gathered information from two different Swedish samples of small firms. The managing director was asked about employment and sales growth as well as sales and related motivation. The researchers then used regression analysis to investigate the data.

The study found that motivation was a relevant predictor of firm growth. The results provide evidence showing support for the idea that motivations of managers affect important firm outcomes. Managers vary in their motivations to grow firms, and those motivations affect the growth achieved.

Growth motivation is partly affected by previous outcomes but remains relatively stable over time. This is an important result, as motivations have to be stable to be good predictors of behavior. Hence, growth motives are effective predictors of firm growth when they are stable over time.

Source: Wiley

Explore further: Aboriginal people – how to misunderstand their science

add to favorites email to friend print save as pdf

Related Stories

Small businesses grapple with handling online image

Aug 15, 2013

Restaurants, mom-and-pop shops and other small businesses often face an abundance of frustrating complications during start-up - construction delays and supply shortages being among the top obstacles.

Recommended for you

Aboriginal people – how to misunderstand their science

58 minutes ago

Just one generation ago Australian schoolkids were taught that Aboriginal people couldn't count beyond five, wandered the desert scavenging for food, had no civilisation, couldn't navigate and peacefully ...

Can science eliminate extreme poverty?

Apr 16, 2014

Science has often come to the rescue when it comes to the world's big problems, be it the Green Revolution that helped avoid mass starvation or the small pox vaccine that eradicated the disease. There is ...

Japan stem cell body splashes cash on luxury furniture

Apr 14, 2014

A publicly-funded research institute in Japan, already embattled after accusing one of its own stem cell scientists of faking data, has spent tens of thousands of dollars on designer Italian furniture, reportedly to use up ...

User comments : 1

Adjust slider to filter visible comments by rank

Display comments: newest first

superhuman
2 / 5 (1) Jun 05, 2008
>This is an important result

Yes this is an extremely important result, and very unexpected! Who could have known that motivation of business managers can affect firm growth!

More news stories

Poll: Big Bang a big question for most Americans

Few Americans question that smoking causes cancer. But they have more skepticism than confidence in global warming, the age of the Earth and evolution and have the most trouble believing a Big Bang created the universe 13.8 ...

NASA's MMS observatories stacked for testing

(Phys.org) —Engineers at NASA's Goddard Space Flight Center in Greenbelt, Md., accomplished another first. Using a large overhead crane, they mated two Magnetospheric Multiscale, or MMS, observatories – ...