Determinants of the dynamism of small and medium enterprises in Colombia

Because of the importance of small and medium enterprises (SMEs) for the development of the economies of the world, a better understanding about their performance is required. The purpose of this study is to identify factors that determine the dynamism of Colombian SMEs in the frame of the resource-based view and institutional theories. The object of study are SMEs employing between 11 and 200 people, located in the Colombian regions of Cundinamarca and Valle del Cauca. The logistic regression model is used with a sample of 384 companies from a population of 19,452. It finds that resources and capabilities, such as technology, brand positioning, the ability of the entrepreneur to resolve conflicts, the flexibility to adapt to new scenarios, the entrepreneurial formation and firm capabilities developed in the administrative, and formal and informal institutions, such as bargaining power, support from friends and acceptance and support from the community, are associated with entrepreneurial dynamism. The results suggest that the profile of the entrepreneur hits the dynamism of the company in his role as founder and strategist, and that recognition of the company by customers, suppliers, institutions, banks, etc., generates it legitimacy and greater dynamism.