Question

What considerations should small-business entrepreneurs keep in mind when they are deciding whether a company should follow a growth or a stability strategy?

Answer 1

The launch of any new ventures, which is best undertaken with a detailed understanding of the resources available and the strategic actions needed to achieve project objectives. There should be an indication of what should be done in various contingencies. In other words, a new venture needs to be planned in a detailed manner. This is situation an above. Frequent lack of any such planning, even significant strategic management, will help to explain the extremely high attrition rate for small businesses in all types of economy. Companies may however, choose a stability strategy because the entrepreneur is mostly generating employment for family members. Providing the family a "decent living”, and being the "boss" of a firm small enough that he or she can manage it comfortably. Finally some business owners don't pursue a growth strategy because they do not want the loss of control that results from bank debt or the sale of stock to outsiders.