MRN 29,6. The current issue and full text archive of this journal is available at

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1 The current issue and full text archive of this journal is available at MRN 29,6 334 Strategic planning in smaller enterprises new empirical findings Sascha Kraus Department of Entrepreneurship, University of Oldenburg, Oldenburg, Germany Rainer Harms and Erich J. Schwarz Department of Innovation Management and Entrepreneurship, University of Klagenfurt, Klagenfurt, Austria Abstract Purpose To analyze the performance implications of essential elements of strategic planning (time span, formalization, frequency of control, and use of planning instruments) in smaller enterprises in a simultaneous way. Design/methodology/approach The main methods being used for this article were a thorough review of literature for the development of hypotheses and a logistical regression analysis for the empirical evaluation. The study is based on a representative sample of small Austrian enterprises (n = 290). Findings Planning formalization has a positive and highly significant impact on the probability of belonging to the group of growth firms, whereas other aspects of strategic planning (time horizon, strategic instruments, and control) did not contribute to performance. Research limitations/implications Employee growth has been used as an indicator for firm performance. Other indicators (e.g. sales growth, profitability, and subjective evaluation of the entrepreneur) might be used to draw a more detailed picture. Additionally, dichotomizing the dependent variable has some weaknesses. Furthermore, only a limited number of industry categories have been controlled for. Practical implications Practitioners might want to emphasize formal strategic planning in order to enhance the probability of performance. Also, they might want to regard the business plan as a management and learning tool rather than as a pure means to generate funding. Originality/value This paper is the first to analyze different dimensions of strategic planning in small firms simultaneously. Additionally, it is one of only very few studies outside of the Anglo-American realm, which might be a help especially for European SMEs (small and medium-sized enterprises). Keywords Strategic planning, Small to medium-sized enterprises, Business planning, Business performance Paper type Research paper Management Research News Vol. 29 No. 6, 2006 pp # Emerald Group Publishing Limited DOI / Introduction Due to the great importance of small and medium-sized enterprises, which contribute 66 per cent to the total employment and 55 per cent of total revenues of the private sector in the European Union (Bauer, 2002), it is of particular interest to identify factors which contribute to the performance of these firms. Strategic planning might be one of these factors. Strategic planning consists of planning processes that are undertaken in firms to develop strategies that might contribute to performance (Tapinos et al., 2005). Key aspects of strategic planning are a long time horizon, formality, the use of planning instruments, and frequent control of plans. Strategic planning can contribute to performance by generating relevant information, by creating a better understanding of the important environment, and by reducing uncertainty (Hodgetts and Kuratko, 2001).

2 While the analysis of the performance impact of strategic planning is largely confirmed in the context of larger firms (Bracker et al., 1988; Lyles et al., 1993; Rue and Ibrahim, 1998; Schwenk and Shrader, 1993), its relationship in the context of smaller enterprises has not been given much attention in existing research. While there is some evidence in support of a positive relationship between strategic planning and performance in smaller enterprises, other studies find no relationship or even a negative relationship. A possible reason for these inconclusive findings may be that previous studies used differing definitions of strategic planning or tested only one of the dimensions of strategic planning. In order to draw a differentiated picture of the performance impact of strategic planning, we test the performance implications of a quadrinominal concept of strategic planning that contains the elements time horizon, degree of formalization, use of strategic instruments, and degree of control in a single analysis. The empirical analysis will be carried out in a sample of 290 small enterprises from Austria. Strategic planning 335 Literature review A literature analysis on the subject of the performance implications of strategic planning in smaller enterprises was undertaken in order to gain insight into the relationship between strategic planning and performance in smaller enterprises. This literature analysis is based on a review of empirical studies on that subject and covers the last 25 years. The analysis applied a keyword search in leading entrepreneurship and strategy journals and in databases. Even though the literature analysis was extensive, only 24 empirical studies were discovered. Considering the long period of time that was covered, this seems to be a rather low number. This indicates that empirical research on strategic planning in small firms is still in its infancy. The literature analysis revealed that smaller enterprises do in fact plan, and most small enterprises even plan in a formal way and use rather large time spans. For example, in a study by Naffziger and Kuratko (1991), 83 per cent of the smaller enterprises managers claimed that they plan in a formal way. In another study, 70 per cent of the smaller enterprises managers reported using time spans of one to three years, and 92 per cent declared to even plan strategically, i.e. for more than three years. However, planning in smaller enterprises is rarely supported by planning instruments, since most of the respondents reported that they planned intuitively, and did not use planning instruments (Stonehouse and Pemberton, 2002). The literature analysis tends to support a positive relationship between strategic planning and performance. Seventy nine per cent of the studies in our analysis identified a positive relationship, which tends to suggest that there is broad support for the performance impact of strategic planning. Evidence in favor of this relationship was discovered in studies of small enterprises from different industries and different regions (Bracker et al., 1988; Bracker and Pearson, 1986; Griggs, 2002; Masurel and Smit, 2000; Orpen, 1985), and using different indicators for performance such as survival (Perry, 2001), turnover growth, employment growth, and reputation (Ackelsberg and Arlow, 1985; Sexton and Van Auken, 1985; Vesper, 1980). However, there were also mixed results. One study in the context of smaller enterprises revealed that the direction of the relationship between strategic planning and performance depends on the industry (Shrader et al., 1989), and several other studies did not find a relationship at all (French et al., 2004; Gable and Topol, 1987; Gibson and Cassar, 2005; Robinson, 1983; Sexton and Van Auken, 1985).

3 MRN 29,6 336 A possible reason for these diverging findings could be that diverging definitions of strategic planning were used, or that the analyses focused on different aspects of strategic planning. For example, most of the studies analyzed only one aspect of strategic planning, namely formalization (Lyles et al., 1993), whereas in other studies, the conceptualizations and operationalizations of strategic planning were not laid open. Development of hypotheses Since strategic planning in general seemed to be positively related to performance, we were interested in discovering which precise aspects of strategic planning relate to performance. Strategic planning is commonly characterized by three criteria: (1) a long-term orientation, (2) strategies in written form, and (3) evaluation and control (Rue and Ibrahim, 1998). Additionally, we assume that the use of strategic planning instruments (or tools) is an important element for strategic planning. The relationship between the time horizon of strategic planning and performance Long-term goals help to identify resource requirements at an early stage. The firm is thus able to acquire resources in advance and more efficiently. Moreover, a firm that aligns sourcing with long-term goals avoids purchases of unnecessary resources. In addition to that, long-term goals can motivate both entrepreneurs and employees (Collins and Porras, 2005). There is empirical evidence in support of a positive relationship between long-term formal planning and performance (Smith, 1998), indicating that the time horizon of plans for high performers is longer that of plans for low performers (Orpen, 1985). Thus, it can be assumed that the length of the time horizon of plans is positively related to firm performance. H1. The longer the time horizon of strategic planning, the more successful is the small enterprise. The relationship between formalization of strategic planning and firm performance Formalization indicates the degree to which strategic plans exist in written form. The process of creating formalized plans forces management to systematically deal with the goals and strategies of the firm. Management attains larger and more systematic knowledge of the characteristics of its environment and of alternative strategies. Previous empirical evidence supports the view that formalized planning increases performance. In one study, smaller enterprises were assigned to the groups of formal and non-formal planners. An investigation of these groups revealed that formal planners grew twice as fast as non-formal planners (Lyles et al., 1993). H2. The higher the degree of planning formalization, the more successful is the small enterprise. The relationship between the frequency of controls and firm performance Control is the process of comparing current developments with previously anticipated developments. Frequent controls allow for a timely and thus cost-efficient adaptation of plans and strategies in case of a deviation between current and anticipated data. Also, controls can initiate a learning process (Ramanujam and Venkatraman, 1987).

4 In addition to that, controls can motivate employees when e.g. achieved goals result in gratification or awards (Collins and Porras, 2005). Empirical studies on strategic planning in small firms have paid little attention to the performance impact of control aspects of strategic planning. An exception is a recent study that shows that the control of plans and of goal achievement contributes significantly to firm performance (Wijewardena et al., 2004). H3. The more frequent the control of strategic planning, the more successful is the small enterprise. Strategic planning 337 The relationship between the use of planning instruments and firm performance Planning instruments are tools which assist long-term planning by systematically structuring goals and means for goal attainment. Thereby, planning instruments help to increase planning efficiency and effectiveness. Instruments for strategic planning that are suitable for use in smaller enterprises are e.g. analysis of financial data, environmental analyses, or SWOT-analysis. Previous empirical evidence from Rue and Ibrahim (1998) supports a positive and significant relationship between planning sophistication in terms of the use of planning instruments and firm performance. Based on the conceptual arguments and on the previous empirical support, we propose the following hypothesis: H4. The more planning instruments are used for strategic planning, the more successful is the small enterprise. Methods Sample The analysis is based on data of small enterprises from Austria. We follow the definition of small firms of the European Commission (2003), according to which small firms are defined as having a staff of fewer than 50 persons and sales of under e10 mn. The population of 19,477 firms is based on all firms that were founded in Austria in Out of this database (which has been provided by the Austrian Chamber of Commerce), a random sample of 1,497 firms was drawn in Out of these firms, 634 structured telephone interviews (42.4 per cent) were conducted with the enterprise founder or CEO (key informant approach). The other firms (57.7 per cent) could not be reached, refused to be interviewed, or closed between 1999 and Excluding takeovers, 552 firms were classified as independent start-ups. In order to analyze the performance of the firms, a second cross-section was taken in In total, 398 independent start-ups were still in business. Because of listwise deletion of cases with missing data, the number of complete cases that were used for analysis was reduced to n = 290. However, the missing cases did not differ significantly from those that were included in the analysis (based on industry affiliation and growth). Descriptive statistics illustrate the characteristics of the sample. The firms in our sample are rather small, with over 90 per cent having less than ten employees. The average annual sales (mean) were at e612,000. Pertaining to the industry composition, 54 per cent of the firms belong operate in services, 24 per cent in trade, 16 per cent in manufacturing, while 6 per cent could not be assigned to an industry category. Operationalization We used employment growth as an indicator for performance (dependent variable). Employment growth was chosen for a three reasons. First, financial data are reported

5 MRN 29,6 338 to be unreliable in the context of small and young firms. Second, growth is an important goal for small and young firms, and third, employment growth is a more stable indicator than turnover growth, since firms only add employees when a higher level of business volume is likely to be stabilized in the future (Delmar, 1997). More precisely, we measured employment growth as the change in the number of employees including founding person(s) in full-time employment equivalents between 1999 and Because the distribution of employment growth differed significantly from the normal distribution, and a high share of firms reported to have not grown, the variable was dichotomized in group 0 (decline or no growth) and group 1 (positive growth). As independent variables, we used the time horizon, the degree of formalization, the degree of control, and the use of strategic planning instruments. The respondents were asked to provide information about the average time horizon of their strategic plans (years, metric; median of group 0: 1.36 years/median of group 1: 1.88 years). To assess the degree of formalization, a summed index was calculated. This index is based on the degree of formalization (written planning, informal planning, or no planning) in five different functional areas (technology/innovation, production, marketing, human resource management, finance) and in pre-start-up planning. This index ranged from zero to 12, with higher values indicating a higher degree of formal planning (ordinal; median of group 0: 2.95/median of group 1: 5.18). The degree of control of plans was assessed on a five-point scale with higher values indicating more frequent control (ordinal; median of group 0: 2.20/median of group 1: 2.51). The use of strategic instruments was measured by a summed index that counts the number of strategic planning instruments (SWOT analysis, competitor analysis, analysis of the environment, analysis of financial ratios) and an open category, in which instruments such as portfolio analysis or scenario analysis were mentioned. This index ranged from zero to five, including one open answer category (ordinal; median of group 0: 0.30/median of group 1: 0.61). We included firm size as a control variable because it can be assumed that firms that start with a higher initial size might not grow as fast (in the number of employees) as firms that start with no or few employees. Industry was coded in three dummy variables. The reference category (all dummies being zero) was retail, the first dummy being one indicating non-classified industries, the second dummy being one indicating manufacturing, and the third dummy being one indicating services. Method of analysis Because the distribution of the dependent variable differed significantly from the normal distribution, and because of the high number of firms with no growth, we chose to use a binary hierarchical logistic regression for the analysis. In a first step, we entered the control variables, and in a second step we entered the planning variables. Results First, we wanted to assess if the aspects of planning were not only conceptually distinct, but empirically distinct as well. The results of a non-parametric correlation analysis are shown in Table I. The correlation coefficients between the aspects of strategic planning can be classified as small. The correlation between the degree of formalization and the use of instruments for strategic planning can be regarded as moderate (Cohen et al., 2003). This level of first-order correlations shows that the different aspects of strategic planning might also be empirically distinct.

6 A bivariate comparison of the characteristics of the dependent variables in the group of the no-growth firms and the growth firms is given in Table II (Kolmogorov- Smirnov test). The groupwise comparisons show that the scores for the time horizon of the plans, the use of strategic planning instruments, and the use of controls does not differ significantly between the groups of the no-growth firms and the growth firms. However, the degree of formalized planning seems to be higher in the group of growth firms. A logistic regression analysis reveals whether this finding also holds in a multivariate context. The results of this analysis are presented in Table III. The overall model quality can be regarded as reasonably good. 2 -statistics are significant on a level of under 1 per cent, so the hypotheses stating that all coefficients are zero could be rejected. The Pseudo-R 2 (Nagelkerke) is 0.285, which can be regarded as acceptable. The share of firms that were predicted correctly by the full model is 70.0 per cent. After inclusion of the planning variables, the proportion of firms that were predicted correctly rises by 12.4 per cent, and model quality increased significantly ( , significant on a level of under 1 per cent). The results show that firms operating in the service sector and in the manufacturing sector have a significantly lower propensity to belong to the group of growing firms. However, the result for manufacturing is only significant on a level of under 10 per cent. As expected, the larger the firm was at founding, the lower its propensity to grow, this influence being significant on a level of under 5 per cent. The coefficients for the time horizon, for the use of strategic instruments, and for the control of plans are not significantly different from zero, indicating no relation between these variables and employment growth. The degree of formalization, however, is significant on a level of under 1 per cent. The more formal the strategic planning process, the higher the possibility of belonging to the group of the growing firms. Strategic planning 339 Time horizon Formalization Strategic instruments Frequency of control Time horizon 1 Formalization 0.134* 1 Strategic instruments 0.123* 0.467* 1 Frequency of control * 1 Note: *p < 0.05 Table I. Non-parametric correlation coefficients of independent variables No-growth or decline Growth Mean SD Median Mean SD Median Z statistic P value Time horizon Formalization Strategic instruments Frequency of control Table II. Groupwise comparison of the characteristics of the dependent variables

7 MRN 29,6 340 Table III. Results of hierarchical logistic regression for factors pertaining to strategic planning Step 1: control Step 2: planning Model parameters Coefficient Variable B Significant values Standard Founding size * Industry dummy 1 (1 ¼ not classified) Industry dummy 2 (1 ¼ manufacturing) ** Industry dummy 3 (1 ¼ services) * Time horizon of plans Degree of formalization **** Control of plans Use of strategic instruments Log likelihood (full model): ; n ¼ 290 R 2 (Cox & Snell/Nagelkerke); (full model): 0.213/ (full model): 69.57****/ 2 (after step 2): 11.33**** Percentage correct (control model/full model): 57.6/70.0% Notes: Dependent variable: growth in employees (dichotomized). Significance levels: *<0.05; **<0.1; ****<0.001 Discussion The initial question of this research was whether strategic planning in smaller enterprises contributes to performance. The results of the literature analysis show that smaller enterprises do in fact plan strategically. Our own empirical investigations show that strategic planning can contribute to performance. However, the empirical results draw a differentiated picture of the relationship between strategic planning and performance in small firms. A significant positive relationship to performance could only be identified for the degree of formalization. More specifically, an increase in the degree of formalization of one step enhances the propensity to belong to the group of growth firms by a factor of This result suggests that formalization might be able to contribute to firm performance. Some hypotheses could not be supported. A possible reason for a missing impact of the time horizon on performance might be that the optimal time horizon of strategic planning varies in small enterprises because they need to be and are also often able to be more flexible than larger ones. The use of strategic instruments was not related to performance either. As can be seen in Table I, the use of strategic planning instruments is very low in both groups of firms. Thus, a potential impact on performance could not be detected statistically, even though it might in fact exist. If there were a positive performance impact of the use of planning instruments, awareness of these instruments among managers of smaller enterprises might have increased. It seems that the process of planning rather than the use of specific instruments contributes to performance. The missing relationship between the frequency of planning and performance could be explained by the fact that it might not only be frequency of control, but its intensity that can contribute to an enhanced alignment of plans to current circumstances and, finally, to performance. Support for the generalizability of our findings can be derived from the fact that the firms in the sample are representative (with regard to the legal form and the industry structure) for the 1999 founding age group. Since 1999 was a typical founding age group in Austria (Schwarz et al., 2005), it might be possible to transfer the results to small firms in general.

8 However, there are some limitations that have to be taken into account while interpreting the results. First, we used employee growth as the sole indicator for firm performance. Even though we believe that this indicator is most suitable in the context of small firms, other objective indicators such as sales growth or profitability or subjective indicators such as the personal satisfaction of the owner with firm performance might be used to draw a more detailed picture. Second, by dichotomizing the dependent variable, its variance was reduced, which could obscure the relationship between planning and performance. However, both the distribution of growth and a transformed distribution of growth differed significantly from the normal distribution; we were not able to use ordinary least square regression or treat growth as a continuous variable. Third, the limited number of industry categories might have been too coarse to represent different industry conditions. A more detailed assessment of industries or a direct assessment of industry characteristics such as dynamism or munificence might have been a more control-relevant variable. In future analyses, we will test if industry characteristics can serve as moderator variables between the dimensions of strategic planning and performance. For example, we will investigate whether the use of strategic planning instruments (or any other dimension of strategic planning) can have a stronger relationship with performance under stable market conditions than those found in average or even dynamic market conditions. In addition to a future analysis of the nature of the influence of external variables, we will also focus on discovering the mechanics of how strategic planning works inside the firm. This could lead to a new conceptualization of strategic planning that pertains especially to smaller enterprises. Such a definition could be based on our quadrinominal conceptualization of strategic planning. Strategic planning 341 Conclusion The main objective of this study was to analyze the performance impact of various aspects of strategic planning in small firms. It emerged that a higher degree of formalization is related to a higher degree of performance. Several implications for practitioners follow from our results. First, practitioners might want to plan more formally than before. For example, the creation of a business plan might help the firms to identify risks and opportunities in the marketplace and plan for actions in due time. This might increase the chances of success. Second, since the use of planning instruments in small firms is rather low, it might be beneficial to increase the awareness of these instruments. To do so, issues pertaining to strategic planning might have to be emphasized in curricula for small business managers, both in higher and in further education, and not limited to business-related study programs. Also, handbooks for small business managers which focus on strategic planning without the use of too many technical terms as well as a hands-on approach can contribute to this goal. Also, cooperation with universities in the development of reallife business plans can be helpful. As the results have to be evaluated in the light of the shortcomings of this study, we would be very cautious to conclude that the time horizon of plans, their control and the use of strategic instruments should be disregarded when designing a strategic planning system in smaller enterprises. For example, the control of goal achievement and of planning assumptions is a precondition for re-adjusting plans when unforeseen circumstances emerge. Nevertheless, we hope to have contributed to the dialogue on the performance implications of strategic planning in the context of small firms by evaluating several

9 MRN 29,6 342 aspects of strategic planning simultaneously. Moreover, to the knowledge of the authors, this study is the first to be based on a largely representative cross-sectoral sample from a whole country in a European context. This is particularly noteworthy because the use of strategic planning can be subject to cultural influences, so the results from research in Anglo-American countries might not be able to be transferred in an indiscriminate way. Since we analyzed small firms from Austria, which build the vast majority of firms in the European Union with 93 per cent of all enterprises (Snijders and Van der Horst, 2002), we feel that our results are particularly relevant for these firms. To conclude, we emphasize that small enterprises are not little big enterprises, and thus, suggestions for strategic planning that were developed in the context of large firms might not apply to their smaller counterparts. In the future, specifically tailored concepts of strategic planning in smaller enterprises may emerge. We hope to have contributed to this dialogue. References Ackelsberg, R. and Arlow, P. (1985), Small businesses do plan and it pays off, Long Range Planning, Vol. 18 No. 5, pp Bauer, B. (2002), Kleine und mittlere Unternehmen Übersicht über Bedeutung, bereits getroffene und mögliche weitere Maßnahmen auf EU-Ebene und in Österreich, Federal Ministry of Finance, Vienna. Bracker, J.S., Keats, B.W. and Pearson, J.N. (1988), Planning and financial performance among small firms in a growth industry, Strategic Management Journal, Vol. 9 No. 6, pp Bracker, J.S. and Pearson, J.N. (1986), Planning and financial performance of small mature firms, Strategic Management Journal, Vol. 7 No. 6, pp Cohen, J., Cohen, P., West, S.G. and Aiken, L.A. (2003), Applied Multiple Regression/Correlation Analysis for the Behavioral Sciences, 3rd ed., Lawrence Erlbaum Associates, Mahwah, New Jersey. Collins, J.C. and Porras, J.I. (2005), Built to Last: Successful Habits of Visionary Companies, Random House, London. Delmar, F. (1997), Measuring growth: methodological considerations and empirical problems, in Donckels, R. and Miettinen, A. (Eds), Entrepreneurship and SME Research: On its Way to the Next Millennium, Ashgate, Hants, pp European Commission (2003), Commission recommendation of 6 May 2003 concerning the fefinition of micro, small and medium-sized enterprises, Official Journal of the European Union, Vol. L124/36, pp French, S.J., Kelly, S.J. and Harrison, J.L. (2004), The role of strategic planning in the performance of small, professional service firms a research note, Journal of Management Development, Vol. 23 No. 9, pp Gable, M. and Topol, M.T. (1987), Planning practices of small-scale retailers, American Journal of Small Business, Vol. 12 No. 2, pp Gibson, B. and Cassar, G. (2005), Longitudinal analysis of relationships between planning and performance in small firms, Small Business Economics, Vol. 25 No. 3, pp Griggs, H.E. (2002), Strategic planning system characteristics and organisational effectiveness in Australian small-scale firms, Irish Journal of Management, Vol. 23 No. 1, pp Hodgetts, R.M. and Kuratko, D.F. (2001), Effective Small Business Management, Dryden, Fort Worth, TX.

10 Lyles, M.A., Baird, I.S., Orris, J.B. and Kuratko, D.F. (1993), Formalized planning in small business: increasing strategic choices, Journal of Small Business Management, Vol. 31 No. 2, pp Masurel, E. and Smit, H.P. (2000), Planning behavior of small firms in Central Vietnam, Journal of Small Business Management, Vol. 38 No. 2, pp Naffziger, D.W. and Kuratko, D.F. (1991), An investigation into the prevalence of planning in small business, Journal of Business and Entrepreneurship, Vol. 3 No. 2, pp Orpen, C. (1985), The effects of long-range planning on small business performance: a further examination, Journal of Small Business Management, Vol. 23 No. 1, pp Perry, S.C. (2001), The relationship between written business plans and the failure of small businesses in the US, Journal of Small Business Management, Vol. 39 No. 3, pp Ramanujam, V. and Venkatraman, N. (1987), Planning and performance: a new look at an old question, Business Horizons, Vol. 30 No. 3, pp Robinson, R.B. (1983), Measures of small firm effectiveness for strategic planning research, Journal of Small Business Management, Vol. 21 No. 2, pp Rue, L.W. and Ibrahim, N.A. (1998), The relationship between planning sophistication and performance in small businesses, Journal of Small Business Management, Vol. 36 No. 4, pp Schwarz, E.J., Ehrmann, T. and Breitenecker, R.J. (2005), Erfolgsdeterminanten junger Unternehmen in Österreich: eine empirische Untersuchung zum Beschäftigungswachsum, Zeitschrift für Betriebswirtschaft, Vol. 75 No. 11, pp Schwenk, C.R. and Shrader, C.B. (1993), Effects of formal strategic planning on financial performance in small firms: a meta-analysis, Entrepreneurship: Theory and Practice, Vol. 17 No. 3, pp Sexton, D.K. and Van Auken, P. (1985), A longitudinal study of small business strategic planning, Journal of Small Business Management, Vol. 23 No. 1, pp Shrader, C.B., Mulford, C.L. and Blackburn, V.L. (1989), Strategic and operational planning, uncertainty, and performance in small firms, Journal of Small Business Management, Vol. 27 No. 4, pp Smith, J.A. (1998), Strategies for start-ups, Long Range Planning, Vol. 31 No. 6, pp Snijders, J. and Van der Horst, R. (2002), Hauptergebnisse des Beobachtungsnetz der Europäischen KMU 2002, The European Union s Publisher, Luxemburg. Stonehouse, G. and Pemberton, J. (2002), Strategic planning in SMEs some empirical findings, Management Decision, Vol. 40 No. 9, pp Tapinos, E., Dyson, R.G. and Meadows, M. (2005), The impact of performance measurement in strategic planning, International Journal of Productivity and Performance Management, Vol. 54 No. 5/6, pp Vesper, K.H. (1980), New venture planning, Journal of Business Strategy, Vol. 1 No. 2, pp Wijewardena, H., De Zoysa, A., Fonseka, T. and Perara, B. (2004), The impact of planning and control sophistication on performance of small and medium-sized enterprises: evidence from Sri Lanka, Journal of Small Business Management, Vol. 24 No. 2, pp Strategic planning 343 About the authors Sascha Kraus is Assistant Professor at the University of Oldenburg, Germany and Lecturer at the University of Klagenfurt, Austria, where he also received his PhD. He holds several university degrees in Business Administration and Management from business schools in Germany, The Netherlands, and Australia. Besides this, he has spent three months as a Visiting Researcher at the University of Edinburgh, UK. He is also the founder of a new business venture in the media branch and member of the board of two German SMEs. His main research

11 MRN 29,6 344 areas are strategic management and entrepreneurship. Sascha Kraus can be contacted at: Rainer Harms is Assistant Professor at the University of Klagenfurt, Austria. He also lectures on Entrepreneurship at the Technical University of Berlin and the University of Dortmund, and Business Administration in the Masters course on Management of Protected Areas. He studied economics, politics, and sociology at the University of Münster, Germany, where he also received his PhD in Business Administration in Since 2002, he has been scientific advisor to the Ernst & Young Entrepreneur of the Year contest in Germany. His research interests are entrepreneurship, innovation management, and organization. Currently, he works on the performance implications of customer integration in the innovation process. Erich J. Schwarz is University Professor and Chair of the Department of Innovation Management and Entrepreneurship at the University of Klagenfurt, Austria. He holds a university degree in engineering from the Technical University of Leoben, Austria, a PhD in Business Engineering from the Technical University of Graz, and a Habilitation (higher doctorate) degree in Business Administration from the Graz University, Austria. During his studies, he was a Fulbright Visiting Research Scholar at the Virginia Polytechnic Institute and State University as well as at the University of Clemson, South Carolina. He is author of several books and articles, and was a visiting professor at universities in Austria, Germany, and Slovenia. To purchase reprints of this article please reprints@emeraldinsight.com Or visit our web site for further details:

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