A Replication and Extension of Organizational Growth Determinants

Although the management literature contains an impressive volume of several researchers have exclusively examined the influence of strategy factors on organizational growth (Donaldson, 1987; studies attempting to identify factors that precipitate organizational growth, fragmented theory has developed because of the absence of replicaGrinyer, McKiernan, and Yasai-Ardekani, 1988; Hamilton and Shergill, 1992; Johnson and Thomas, 1987). Others have tive studies that integrate multiple levels of determinants. Previous studies have shown that exclusive use of either industry, strategy, or top manageexamined relationships between characteristics of top management and organizational growth (Gupta, 1984; Hambrick and ment determinants can individually influence sales growth, but no existing research has empirically demonstrated the simultaneous effects of all three Mason, 1984; Norburn and Birley, 1988). Several studies have tried to examine the impact of two levels of determinants. Using a representative sample of 193 firms from 48 industries, this study replicated findings from several tangentially levels of determinants on organizational growth. Researchers related studies to provide empirical support for the simultaneous influence have found concurrent effects of strategy and top management of all three levels of determinants. Relative comparisons among the three characteristics on organizational growth (Feeser and Willard, levels of determinants showed organization strategies to be most significant, 1990; Miller and Toulouse, 1986), strategy and industry charfollowed by top management characteristics and industry attributes. Interacteristics on organizational growth (McDougall, Robinson, actions between industry/strategy determinants and strategy/top manageand DeNisi, 1992; Romanelli, 1989), and industry and top ment determinants were also found to be significant. J BUSN RES 2000. management characteristics on organizational growth (Eisen48.35–41.  2000 Elsevier Science Inc. All rights reserved. hardt and Schoonhoven, 1990). However, all of the studies that examined growth determinants at two levels used restricted samples such as single industry samples or samples consisting only of small businesses. Organizations can benefit from growth in many ways, Although previous studies have shown that exclusive use including greater efficiencies through economies of of either industry, strategy, or top management attributes can scale, increased power, the ability to withstand enviindividually influence organizational growth, researchers have ronmental change, increased profits, and increased prestige yet to develop a unified model of organizational growth that for organizational members. A review of the management provides concurrent empirical support for all three levels of literature on organizational growth yields an extensive stream determinants. Moreover, limited attempts have been made to of research on consequences of growth, but only a limited investigate interactions among organizational growth determibibliography on determinants that precipitate growth. Alnants. though earlier research has suggested a number of determiIn an attempt to combine growth determinants from tannants of organizational growth, strategy and organization thegentially related studies into a single convergent model, findory researchers have been unable to gain consensus regarding ings from past research are replicated to develop a multilevel factors leading to organizational growth; therefore, creating model. We triangulate the simultaneous influences of industry fragmented theory (Davidsson, 1991; Kazanjian, 1990; Whetattributes, portfolio-level and competitive-level organizational ten, 1987). strategies, and characteristics of top management teams by This lack of consensus may in part, result from the absence testing main effects, interaction effects, and relative compariof replicative studies that attempt to integrate multiple levels sons among sets of determinants. In addition, to overcome of determinants to examine simultaneous effects. For example, sampling limitations from previous research examining multiple levels of determinants, this study uses a broad-based sample of organizations from multiple industries to increase the Address correspondence to: Dr. L. G. Weinzimmer, Foster College of Business Administration, Bradley University, Peoria, IL 61625, USA. generalizability of findings.