Performance configurations over time: implications for growth- and profit-oriented strategies

Strategic entrepreneurship can be described as simultaneous opportunity seeking and advantage seeking. Younger firms are generally more flexible and therefore enjoy 'discovery advantages', whereas established firms tend to be resource rich and more experienced and consequently enjoy 'exploitation advantages'. The resulting evolution of the two important performance dimensions 'growth' and 'profitability' by firm age is not well understood. In this paper we integrate several theoretical arguments concerning profit-growth relationships to develop a dynamic model of firm development which suggests different development pathways for young firms. This leads to several unidirectional, competing hypotheses that we examine by studying the profitability-growth configurations of approximately 3,500 small firms and how these configurations evolve over time. We find that for both young and old firms, a focus on achieving above-average profitability and then striving for growth is a more likely path towards achieving sustained above-average performance than is first pursuing strong growth in the hope of building profitability later. In line with our hypothesis we find that younger firms are over-represented as 'Stars' (high on both growth and profitability) and under-represented as 'Poor' (low on both growth and profitability). However, young firms in the 'Star' category are also less likely than their older counterparts to maintain that position. Furthermore, our results indicate that young firms are over-represented not only among 'Stars', but also among growth-orientated firms regardless of the level of profitability. The findings strongly caution against the blind pursuit of growth for young firms, in favor of a thoughtful analysis of how both growth and profitability might be developed by firms. The results also question whether simultaneous high performance in terms of growth and profitability among young firms usually reflects a successful entrepreneurial strategy. The results can also be interpreted as luck on the part of a sub-group of young firms who indiscriminately pursue growth opportunities with varying profit prospects, and in many cases the high growth-profit performance will be short lived

Influence of Family Involvement in Management and Ownership on Firm Performance Evidence from Poland

This article investigates the influence of family involvement on firm performance in an emerging market economy. Using a panel of 217 Polish companies from 1997 to 2005, the authors find an inverted U-shaped relationship between the share of family ownership and firm performance. The data also reveal that firms with family CEOs are likely to outperform their counterparts that have nonfamily CEOs. The results take into account the endogeneity of family ownership and are robust to a number of specification checks

Surveillance for antimicrobial resistance in Australian isolates of Clostridium difficile, 2013–14

Objectives: The objective of this study was to determine the activity of fidaxomicin and comparator antimicrobials against Clostridium difficile isolated from patients with C. difficile infection (CDI) in Australian hospitals and in the community. Methods: One private and one public laboratory from five states in Australia submitted a total of 474 isolates/PCR-positive stool samples during three collection periods in August-September 2013 (n=175), February-March 2014 (n=134) and August-September 2014 (n=165). Isolate identification was confirmed by selective culture for C. difficile and a proportion of isolates from each state were characterized by PCR for toxin genes and PCR ribotyping. MICs of fidaxomicin and eight comparator antimicrobials were determined for all isolates using agar methodology. Results: Site collection yielded 440 isolates of C. difficile and PCR revealed a heterogeneous strain population comprising 37 different PCR ribotypes (RTs), 95% of whichwere positive for tcdA and tcdB (A+B+). The most common RTs were 014 (29.8%) and 002 (15.9%). Epidemic RT 027 was not identified; however, small numbers of virulent RTs 078 and 244 were found. Resistance to vancomycin, metronidazole and fidaxomicin was not detected and resistance to moxifloxacin was very low (3.4%). Fidaxomicin showed potent in vitro activity against all 440 isolates (MIC50/MIC90 0.03/0.12 mg/L) and was superior to metronidazole (MIC50/MIC90 0.25/0.5 mg/L) and vancomycin (MIC50/MIC90 1/2 mg/L). Conclusions: These data confirm the potent in vitro activity of fidaxomicin against C. difficile. Moreover, this study provides an important baseline for ongoing long-term surveillance of antimicrobial resistance and prospective tracking of prominent and emerging strain types

Comment: The Performance of Performance

As Bill Starbuck observes, measures of performance do not perform very well. They are compromised by measurement and data errors, which complicates statistical inferences. Nevertheless, performance measurements are needed and may be necessary for guiding organizational changes. Although the errors that Starbuck notes are important, there are other considerations that may be more damaging for most uses of performance data. Most users of performance measurements are interested in what they reveal about behaviors and capabilities. They use performance measures as signal of some underlying latent trait, such as leadership ability of competitive advantage. Seen from this perspective, performance measures are plagued by several other sources of error and bias in addition to those discussed by Starbuck