Competitiveness is a multidimensional construct, which includes a combination of factors (assets and processes) that determine the firm’s performance. The major theories, which seek to explain firm-level competitiveness include: industrial organisation (IO), resource-based view (RBV), and configuration theory (CT). Building on these theories, the project aims to make a contribution through further development of a configuration theory of SMEs competitiveness factors, while paying particular attention to the key factors in context of globalization.
Relatively complex models of SMEs competitiveness were developed by Man et al. (2002), Sirikrai and Tang (2006), Toppinen et al. (2007), Szerb and Terjesen (2010), Chew et al. (2008, Yan (2010), Awuah and Amal (2011), and others. All these models combine different external and internal factors of SME competitiveness without differentiating the effects of specific to the globalization context factors, which reflect major changes in the operating environment. Most of the key factors have been analysed individually and there is a lack of research on their interaction and combined effects. As Singh et al. (2008, p. 536) observed, the “holistic approach has not been adopted to analyse the competitiveness. Researchers analysed certain aspects of competitiveness in isolation”. The present project aims to fill these gaps by researching the role of combinations of specific to the globalization competitiveness factors.
The main research goal of the project is to analyse the effects of particular combinations of key factors on the SMEs competitiveness in the context of technological and global economic changes. Particularly, the goal is to establish to what degree, and in which ways, these factors’ combinations influence the SMEs performance under different economic conditions. It will also consider the differences in the SMEs competitiveness between more and less advanced economies: UK and Bulgaria. The conceptual model is based on combining the strong points of the IO theory, RBV, and configuration approach (Fig. 1).
The expected outcomes from the analysis, using this conceptual framework, will provide insights into:
- How different external and internal to firm conditions influence the development of specific to the globalization firm’s competitiveness factors;
- Whether the globalization related factors have a greater influence than classical ones on firm performance under different economic conditions;
- To what extents do these factors mutually reinforce each other;
- Deepening the understanding of the interaction and configurations of these factors in respect of the firms’ competitiveness in the context of globalization
Testing the proposed model will lead to better understanding of the unique configurations of SMEs competitiveness factors in different economic situations, countries, and particular sectors. Being highly specific, these configurations will serve to inform the practices of entrepreneurs and SME policy makers, as they will indicate context specific measures and policies. In this way the research will help to overcome some of the shortcomings of the generic measures to improve SMEs performance.
The proposed model of SMEs competitiveness factors will facilitate greater inter-connection between theories of the firm competitiveness (particularly the theory of market forces, resource based view, and configuration theory). Thus the project will outline the prospects and means for creating a particular SMEs competitiveness index with regard to specific sectors or countries, which has been lacking until now.