Success Factors in Small and Micro Businesses – a Study of Three Branches of Industry in North Karelia

The purpose of this study was to identify those factors that are supposed to be the most important in terms of success in the three investigated branches of industry (tourism, ICT, plastics and metal), especially from the SME point of view. The measures used in the questionnaire were based on and adapted from Pasanen’s (1999, 2004) and Valos and Baker’s (1996) work. Privately owned independent SMEs were chosen as the study population. Questions about growth, growth intentions and internationalisation were also included. The respondents were asked to evaluate the importance of the given factors for the firm’s success in the field of industry (s)he represents and how highly the respondent evaluated the company’s expertise in each factor in their operations. Two groups were made based on whether the companies wished to expand their operations slowly or fast. Success factors were then examined separately in each group. The results indicate that there are no statistically significant differences in the views held by slowly or fast growing enterprises regarding the importance of the success factors. The respondents emphasise the importance of customer orientation, good skills in leadership, internal marketing and a good reputation of the firm and the product. Because these are also the key elements of market orientation, it could be surmised that market orientation seems to play a key role in the performance of small and micro firms. Customer orientation is also well mastered according to the enterprises. In all branches of industry, expansion to export markets would need most development, but this factor, on the other hand, has been evaluated as a less important success factor than most other factors in all three lines of industry. The impact of external advice (incubators, consultants, research organisations) was evaluated as the least important factor of success. 1 Professor (acting), University of Joensuu, Department of Business and Economics, Marketing. P.O.Box 111, 80101 Joensuu, Finland, Tel. +358 500 885629, [email protected]