Achieving entrepreneurial growth despite resource and capability constraints: the role of service intermediaries

Abstract

Abstract Entrepreneurial growth—firm growth via the introduction of new market offerings or expansion into new markets—is an important topic for entrepreneurship scholars and practitioners alike. Any firm that wants to exploit opportunities for entrepreneurial growth needs resources and capabilities that it can use to develop new market offerings or to enter new markets. However, many firms face resource and capability constraints, and research has shown that strategic partnerships can provide external pathways for firms to exploit growth opportunities despite their resource and capability constraints. All the extant external growth pathways have in common that they require firms to have some resources and capabilities, which are valuable for partners and can be jointly appropriated with them. An alternative pathway for firms to leverage external resources and capabilities—especially knowledge-based ones—that has received little attention in the literature on growth is short-term contracting of professional service firms such as accounting firms, marketing agencies, or R&D consultancies. Hence, we investigate the role of service intermediaries—professional service firms that facilitate the exchange of services among other firms—as external managers who support their clients to access and leverage a broad range of required resources and capabilities from third parties. We conducted a nested multi-case study of two service intermediaries that enabled two small, wineries from North Macedonia to successfully seize entrepreneurial growth opportunities in markets abroad despite their resource and capability deficits. We identify seven support mechanisms—need articulating, social embedding, linking, governing, clarifying, renegotiating, and mediating—through which the service intermediaries orchestrated complementary external resources and capabilities on behalf of the wineries, thereby enabling the two firms to successfully develop two new product lines for and enter two new geographic markets each. We also identify process differences depending on the stage of the opportunity evaluation process, target market characteristics, and external stakeholder involvement for which we postulate three propositions about the influence of mechanisms on the growth opportunity development. Our study offers novel insights and makes a contribution to research on entrepreneurial growth and resource orchestration.