Characteristics of innovative, high growth and highly successful SMEs

Tomi Heimonen

Research output: ThesisDoctoral ThesisCollection of Articles


This dissertation is based on a series of studies that examine characteristics of innovative, high growth and highly successful small and medium sized enterprises (SMEs). Previous analyses emphasise that innovation and growth are the very essence of successful entrepreneurship. However, despite major investments in attempts to foster innovation, and intensive investigation of relevant factors, the proportions of SMEs that are innovative, rapidly growing and highly successful are marginal. Many entrepreneurs fail, and an examination of relationships between variables, e.g. growth and success, should consider how they are related across their ranges rather than merely at one end of the ranges of the variables. Moreover, very few studies have examined simultaneously the influential factors and relationships among innovation, growth and success.

The dissertation consists of an overview and four appended articles that address two key questions. Firstly, what are the relationships (if any) between innovation, growth and the success of firms? Secondly, how could high, innovation-driven growth been supported? These questions were addressed by applying mixed methods, including regression, discriminant analyses, logistic regression and case studies. The data were collected using a purposeful sampling strategy and came from the following sources: 1) the Voitto+ CD-ROM database, from which 567 growing businesses in Finland were identified – 466 in urban and 101 in rural areas; 2) a refined sample from these sets of 348 SMEs, 262 located in urban and 86 in rural areas; 3) a survey of 213 small knowledge-intensive business service firms, 4) detailed examination of five selected HGS SMEs and 5) interviews with key informants of 12 small technology-based knowledge intensive business service firms.

The results confirm that there is a positive relationship between innovation and growth, but negative relationships were found between financial success and both growth and innovation. Thus, the concepts of growth and success do not appear to be surrogates.The results also show that successful ventures have no discernible typical characteristics, and HGS firms follow diverse development paths. However, focused strategies and critical events that trigger strategic changes generally precede HGS periods of SMEs. Furthermore, the type of ownership may affect the relative attention paid to maximizing growth and increasing profitability or other parameters of financial success. The results also indicate that current innovation support services are insufficiently flexible to provide the support firms need to meet the challenges that growing innovative firms may face during commercialisation of their technologies and inventions. The investigations also identified several methodological problems that arise when analysing characteristics of HGS SMEs, and possible ways to address them.
Original languageEnglish
QualificationDoctor's degree
Awarding Institution
  • Aalto University
  • Kyrö, Paula, Supervising Professor
Print ISBNs978-952-60-5020-1
Electronic ISBNs978-952-60-5019-5
Publication statusPublished - 2013
MoE publication typeG5 Doctoral dissertation (article)


  • entrepreneurship
  • smes
  • companies
  • growth
  • innovation
  • success


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