The Nature of the Regional SME

AbstractThe dominant forms of enterprise in Australian regions are, not surprisingly, small firms. But does regional location lead to these firms having specific attributes that are associated with the resource and competitive environment of regional locations?In this paper, theories of strategic competitiveness are used as the building blocks for alternative models of the regional firm. These models are used to develop a typology of firms that attempts to explain the fit between a small firm and its regional location. The standard theories based on “industry organization”, “resources”, and “dynamic capabilities” explain much of the variation observed in the case studies, however a more complete coverage of the regional effects on the nature of firm organization and strategy are provided by introducing “evolutionary” and “infrastructure” based paradigms. The typology is illustrated and discussed, using findings from a qualitative, case-based study of small, Western Victorian firms.