1. Managing High-Growth Firms
– literature review and exploratory evidence
Karl Wennberg
Stockholm School of Economics
Ratio Institute
OECD/Polish Ministry of Economy Workshop on
“Management and Leadership Skills in High-Growth Firms”

2. Why Managemnt of
HGFs?
Literature
General
Characteristics
Competencies
Market
Focus
Conclusions
Policy
Implication
Why management of HGFs?
HGFs known to generate the majority of new
jobs created in OECD economies
(Henrekson & Johansson, 2010)
HGFs often employe individuals with “right
attitude” rather than “specified competencies”
(Coad, Daunfeldt, Johansson & Wennberg, 2013)
 But who manages HGFs, and how?

3. Procedure
• 15 core journals in entrepreneurship, innovation and management
considered in previous literature reviews
• Complemented with searches in Scopus and Google Scholar
• Keywords: high-growth firm, high growth, gazelles, rapid growth
(Gilbert et al., 2007; Henrekson &
Johansson, 2010; MacPherson & Holt, 2007)
• General findings
• Only 25 journal articles published to date
• Often small-N studies
Literature to date
Why Managemnt of
HGFs?
Literature
General
Characteristics
Competencies
Market
Focus
Conclusions
Policy
Implication

4. Managers / TMTs:
• Often higher education (Brüderl & Preisendörfer, 2000)
• Often industry experience
• Often serial entrepreneurs (Shuman et al., 1985)
• Extensive networks / social capital (Florin et al., 2003)
• Owner-managers not less apt at running large HGFs
(Willard, Krueger, & Feeser, 1992
Managerial characteristics in HGFs
Why Managemnt of
HGFs?
Literature
General
Characteristics
Competencies
Market
Focus
Conclusions
Policy
Implication

5. Firm background:
• Often professional board
• Often spin-offs from large corporations (Feeser & Willard, 1989)
Strategy / Business evolution:
• Often exporting / international orientation (Feeser & Willard, 1990)
• Pursue „Innovative strategy‟ (Brüderl & Preisendörfer, 2000)
• Primarily internally genererated funds
• Often growing profitably, but highly fluctuating
(Markman & Gartner, 2002)
HGF Firm characteristics
Why Managemnt of
HGFs?
Literature
General
Characteristics
Competencies
Market
Focus
Conclusions
Policy
Implication

6. Important managerial characteristics quite similar to what
matters in literature review of ”general growth”…
• Larger team
• Manager(s) Education (Gilbert et al., 2007;
• Industry and leadership experience MacPherson & Holt, 2007)
• HGFs often exhibiting ‟erratic growth‟
(Daunfeldt & Halvarsson, 2011)
In what ways are HGFs distinct?
Why Managemnt of
HGFs?
Literature
General
Characteristics
Competencies
Market
Focus
Conclusions
Policy
Implication

7. Key: Competence Development
Recruitment
strategic issue
Certain internal
competence
development
Strategies centering
on employee
Bottleneck:
“Findings the right
people"
Data on:
• Survey of 127 randomly
sampled Swedish HGFs 2012
• Longitudinal case studies on
6 Swedish HGFs 2012
• Longitudinal study of 282
“growth companies”
Why Managemnt of
HGFs?
Literature
General
Characteristics
Competencies
Market
Focus
Conclusions
Policy
Implication

8. Success factor: Market focus?
Market focus provide
competitive edge,
especially for non-
technology firms
(McKelvie, Brattström &
Wennberg, 2013)
Flexibility to take
market shares even
during economic
downturns
Flexibility to
expand/move focus
to new areas
Employees moved to
growth areas
Helping customers
meet their own
market demand
Provide customers
what they need –
not always what
they ask for
Why Managemnt of
HGFs?
Literature
General
Characteristics
Competencies
Market
Focus
Conclusions
Policy
Implication

9. • Only 25 published studies on management in HGFs
• What characterize management of HGFs resembles what
characterize management of growth firms in general
• Human Resources, Strategy, Organization, Economics,
Dynamic Systems, Networks, etc.
• Erratic growth patterns, not always profitable growth
(Halvarsson & Daunfeldt, 2011;
Markman & Gartner, 2002)
Knowledge
Gap
Tentative
evidence
Interdisciplinarity
Stochastic
Conclusions
Why Managemnt of
HGFs?
Literature
General
Characteristics
Competencies
Market
Focus
Conclusions
Policy
Implication

10. • Enhance competencies by policies (i) expanding
the TMTs and/or (ii) ease the hiring of experts
(Littunen and Tohmo, 2003;
Kaulio, 2003)
• Taxation of owner-managers,”lock-in” of experts
due to labor market regulations, need for
internally generated profits to fuel growth
(Henrekson & Johansson, 2011;
Delmar et al., 2013)
• Networking rather than training activities in
accelerators, incubators, science parks
(Amezcua et al., 2013)
The importance of TMT
competencies
Tentative Policy implications
The importance of
institutional conditions
Business dynamics of
HGFs
Why Managemnt of
HGFs?
Literature
General
Characteristics
Competencies
Market
Focus
Conclusions
Policy
Implication

11. Gratitude to collaborators…
…Nils Karlson, Henrik Lindberg, Elina Fergin, Markus
Danell & Sebastian Hamilton (Ratio)
…Nedim Efendic (SSE)
…Sven-Olov Daunfeldt & Dan Johansson (HUI)
…Erkko Autio (Imperial College)
…Johan Wiklund (Syracuse University)
…Frederic Delmar (Lund University)
…Alex Coad (University of Sussex)
…Anna Öhrwall Rönnbäck (Linköping University)
…Erik Stam (Utrecht University)
Questions/ comments?
And funding bodies…
Ragnar Söderbergs Foundations
Handelsbankens Foundations
FORES
VINNOVA