Strategic management of small firms in hostile and benign environments
Version of Record online: 8 NOV 2006
Copyright © 1989 John Wiley & Sons, Ltd.
Strategic Management Journal
Volume 10, Issue 1, pages 75–87, January/February 1989
How to Cite
Covin, J. G. and Slevin, D. P. (1989), Strategic management of small firms in hostile and benign environments. Strat. Mgmt. J., 10: 75–87. doi: 10.1002/smj.4250100107
- Issue online: 8 NOV 2006
- Version of Record online: 8 NOV 2006
- Manuscript Revised: 17 MAR 1988
- Manuscript Received: 15 MAR 1987
This paper reports the results of a study designed to investigate the effective strategic responses to environmental hostility among small manufacturing firms. Data on environmental hostility, organization structure, strategic posture, competitive tactics, and financial performance were collected from 161 small manufacturers. Findings indicate that performance among small firms in hostile environments was positively related to an organic structure, an entrepreneurial strategic posture, and a competitive profile characterized by a long-term orientation, high product prices, and a concern for predicting industry trends. In benign environments, on the other hand, performance was positively related to a mechanistic structure, a conservative strategic posture, and a competitive profile characterized by conservative financial management and a short-term financial orientation, an emphasis on product refinement, and a willingness to rely heavily on single customers.