‘No-growth’ entrepreneurial strategy in microenterprises

Abstract

It has been demonstrated that many small businesses have no desire for growth. In this article, we investigate whether a ‘no-growth’ strategy in microenterprises can still lead to performance enhancement. To explore this issue, we followed a panel of 13 microenterprises over 12 years with an ‘acted research’ protocol. This consisted of yearly intensive interactions between academics and panel participants including four group seminars, one interview with each owner-manager and firm observation. It resulted in a co-constructed model of ‘no-growth’ to which all study participants agreed. During the study, all 13 microenterprises reduced their employee count and pivoted their business models toward more exclusive offerings. Underpinned by the resource-based and dynamic capabilities theory, we demonstrate that a ‘no-growth’ strategy resulted in increase in margins, efficiency improvements and better work-life balance for the owner-managers and their collaborators. Theoretical, methodological and managerial implications are provided.

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