The dynamics of SME growth processes and the role of enabling constraints: an evidence-based theoretical framework

Abstract

PurposeThis paper aims to explain the dynamics of entrepreneurial decisions and actions (D&As) in the small and medium-sized enterprise (SME) growth process. The study focuses on the changing portfolio and relationship governance and captures these dynamics by using the concept of “enabling constraints” (ECs).Design/methodology/approachIn-depth, long-term and multiple-case study method was adopted based on six high-growth SMEs. Pattern-matching and alternative template approach formed a basis for developing a research framework, further corroborated and advanced in the empirical study.FindingsThe research provides empirical evidence of ECs as entrepreneurial perceptions that both limit (constrain) the range of accessible options and facilitate (enable) new opportunities. This study’s results point to how owner-managers' judgments about growth motives and rationales constrain their choices and how they enable new directions, acknowledging the changing context.Originality/valueThis work contributes to the research on SME growth processes by specifying their dynamics in terms of a creative mutual causality. Here, D&As stem from entrepreneurs' perceptions that are affected by the context, with the latter also shaped by prior decisions and actions. This theoretical contribution has been synthesized in the form of a framework of ECs in the SME growth process with related propositions.