Which business practices set successful firms apart from others? We address this question using data from an official survey of almost 3000 New Zealand firms.
customer and supplier focus,
quality and process monitoring,
community and social responsibility,
business structure and
the competitive environment.
Some of these are internal practices reflecting a firm's resources and capabilities; some are characteristics of the external environment.
We find that capital investment choices, R&D practices, market research and a range of employee practices are positively associated with firm success; industry structure is also a key determinant of success.
The association between specific business practices and firm success is mostly independent of firm size, age and industrial sector, other than for export marketing.
Grimes, Arthur and Richard Fabling. 2007. "Practice Makes Profit: Business Practices and Firm Success," Small Business Economics, 29:4, pp. 383-399.