Principal Topic

Numerous manuals have been written that provide considerable amounts of practical advice on how a firm can increase its chances for survival and success, but no serious attempts are made to anchor the advice in systematic empirical research. In this paper we attempt to develop a quantifiable and research-based instrument for assessing and assisting the development of young firms. The specific model we try to give a systematic operationalization is Klofsten’s Business Platform Model. This model builds on previous research and has been used extensively in qualitative research and business consulting.

Method

 Klofsten’s Business Platform Model defines eight firm-level cornerstones that determine a firm’s early development process. These eight cornerstones are the business idea, the product, the market, the organisation, core group expertise, core group drive/motivation, customer relations and other relations. An instrument of a total of 36 items forced-choice items (three to six for each dimension) was developed and tested on a sample of 114 young technology-based firms in Sweden. In order to test the validity and reliability of the instrument we used SPSS routines Reliability, Factor, and Correlation.

Results and Implications

 In all, our attempt to create a formal operationalization of the Business Platform Model has been successful. The results indicate high face validity, moderate to very high reliability (Cronbach Alphas in the .60-.90 range) and high discriminant validity for the different cornerstone indices. While much remains to be done before a fully satisfactory tool has been developed, this is an important step towards making the Business Platform Model a quantifiable, holistic and action-oriented instrument for assessing and assisting the development of young firms.

CONTACT: Magnus Klofsten, Linköping University, Centre for Innovation and Entrepreneurship, Teknikringen 7, 581 83 Linköping, Sweden; (F) +46 13 28 25 50; MagKl@UDV.LiU.SE