Often researchers in entrepreneurship attempt to define small businesses in terms of behavior of owner-manager/entrepreneur, entrepreneurial orientation or influence/impact on the market. Considering the role of corner shops and other retail businesses in facilitating price and economic stability, small businesses have not received adequate attention in the literature. One solution for this inadequacy is to address small business by defining it from different perspective.
I believe the resource-based view is an appropriate lens with which to study small firm management practice (see:http://www.emeraldinsight.com/journals.htm?articleid=1805555&show=abstract) but defining a small firm in terms of resource 'use' may be confining ... as such, my own view on resource is that it can be leveraged in a manner that allows for small firm capability development. Small firm collaboration is certainly becoming the accepted model of engagement wherein small firms have the opportunity to leverage collective resource in interaction with like-minded firms (i.e. in a small firm network) - although this likely depends on full engagement to gain resource efficiencies.
Agreed. Much of the literature focuses on big companies' processes and assumes that these processes will apply to small businesses as well. In addition to resource-use, which can have its own nuances in small businesses, there is also the crucial networking processes. Much of the resources used in small businesses, especially in start-ups, comes from outside the firm. So, in addition to efficient use of the internal resources, there is considerable need of acquisition and adaptation of external resources to the internal needs. This is where learning processes have a critical role to play: in the adaptation/transformation of external resources for efficient use internally.
Hi Upananda ,
The usefulness of analyzing firms from the resource side rather than from the product side is a overarching principle of resource based view by Penrose. In analogy to entry barriers and growth-share matrices, the concepts of resource position barrier and resource-product matrices are suggested by Birger Wernerfelt(2007). These tools are then used to highlight the new strategic options which naturally emerge from the resource perspective. Though this does not mean that they necessarily just use of resources. Although, resource allocating at the individual and organizational level is vital but just what is the role of aspirations at individual level fluctuating market needs. The market and consumers don't care about the business using resources efficiently but effectively .
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