STRATEGY

EDITOR'S NOTE

As governments worldwide show increasing interest in the power of entrepreneurism to
successfully address the demands for economic growth, the process of small business
formation and sustainedinnovation have come to dominate our current research thinking. In
this issue, we examine the critical role of entrepreneurial drive, organizational architecture and
the necessary tangible mechanisms for successful growth management in infrastructure design.

Our lead article (the I 997 SBIDA Distinguished Empirical Research Award winner) by
James and JoAnn Carland demonstrates an exploratory model of potential entrepreneurship
and develops the implications for entrepreneurship education. Their challenge to incorporate
creativity into the entrepreneurship curriculum is further documented by Robert Cross and
Frederick Funk who show why leveraging employee knowledge is a critical source of
competitive advantage for the small business firm.

lf small business firms truly are the "Keepers of Capitalistic Virtue," then Professors
Schultz, Bennett and Ketchen's examination of the nature and extent of the relationship
between competitivestrategy and human resource management practices in small businesses
offers a key to building future competitive advantage. Similarly, Drs. Haksever, Cook, and
Chaganti find that the human resources and organizational arrangements of very small and
small firms affects the types of service quality gaps. This paper received the 1997 SBIDA
Distinguished Applied Research Award for illustrating how a popular service quality model
can be utilized by very small/small firms interested in understanding and improving service
quality. Certainly, service quality begins with understanding actual customer buying behavior.
Lisa Spiller and Rich Hamilton provide timely information showing how small firms can
maximize the power of their marketing expenditures by building and utilizing customer
databases.

Small firms financial management and compensation issues are the focus of our last two
articles. Dr. Nancy Day contrasts pay strategies, levels, and structures in 148 small and large
growth companies. Her findings will both surprise and encourage small business decision
makers in their design ofcompensation systems. The same fundamental differences between
'Theory" and "Practice" are uncovered by Youness Alizadeh and Geoffrey Meredith in their
researchoffinancialmanagementinformationsystemsutilized in self employmententerprises
The study illustrates how unsatisfactory systems are further restricting the link between self-
employed small business owners and professional financial advisors.

Joe Singer, Ph.D.
Editor