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1. Introduction

Over the last two decades in particular, growth SMEs have received considerable attention from researchers and policy-makers around the world for reasons identified by Turok (1991, p. 29) as follows:

There is considerable interest within the field of small firms policy and research in the identification of features that distinguish firms which grow from those that stand still or fail. This is thought important if more selective small firms policies are to be developed. Identifying distinctive features of more and less successful firms may also provide insights into the factors influencing small firm development and hence improve understanding of the growth process.

Gibb & Davies (1989, 1990, 1991) give a fuller account of the research and policy imperatives for ‘picking winners’ amongst SMEs world-wide.

An extensive literature search has revealed this to be frequently trodden ground for researchers in a variety of business-related fields. However, in many respects, knowledge acquisition has not been cumulative and there is much that is yet to be settled. In their review of the relevant literature, O’Farrell & Hitchens (1988, p. 1380) conclude that ‘At present an adequate explanatory framework within which to analyse the growth of the small owner-managed manufacturing enterprise has not been developed’. On the basis of their review, Gibb & Davies (1990, p. 26) are of the opinion that ‘The production of such a theory and explanation in the near future is unlikely’. The review of Holmes & Zimmer (1994, p. 97) expresses the belief that ‘an operational framework that distinguishes growth from non-growth small businesses does not exist’. Thus, in order to inform their deliberations, researchers and policy-makers are still compelled to choose, with less than full confidence, amongst imperfect means for describing or characterising SME growth.

The intention in this paper is to once again seek for a theoretically sound and empirically validated explanation of SME growth to serve as a broad conceptual framework for research and policy-making regarding the business growth phenomenon. Ideally, such a framework would need to capture, in a rigorous and consensual manner, the current state of scholarly understanding of the dynamics of SME growth, including the distinguishing characteristics, problems and requirements of growing SMEs. The paper proceeds by first overviewing and briefly evaluating alternate paradigms employed by researchers in the field to describe and explain business growth processes amongst SMEs. Attention is subsequently focused upon recent attempts to develop and validate stage models

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