Lars Silver

Control Aversion and the Search for External Financing in Swedish SMEs

The discussion on growth (see Storey, 1997) and control aversion (Cressy, 1995; Chittenden et al., 1996; Cressy and Olofsson, 1996) in small and medium sized firms has been attracting an increasing amount of attention. Our purpose in this article is to identify under what circumstances small and medium sized firms are prepared to accept outside control in the business firm in order to grow. In the article it is argued that technology development, financial strength, size and perceived need to grow, change firms attitudes towards external financiers. The change in attitude towards more openness eventually leads to an actual behaviour where the principals choose to apply for external finance in the form of bank loans. A linear structural equation modelling program, LISREL, is used to analyse a sample of 281 Swedish firms. The firms all have less than 200 employees, and the sample includes both manufacturing and service firms.

Technical and functional determinants of customer satisfaction in the bank‐SME relationship

Purpose –xa0The purpose of this study is to investigate the influence of the technical and functional dimensions of service management on customer satisfaction in the bank‐SME relationship.Design/met ...

The dyadic bank‐SME relationship: Customer adaptation in interaction, role and organisation

Purpose – This paper aims to emphasise the theory of adaptation in the analysis of banks’ ability to meet the needs of their SME customers. This analysis involves examining the interaction process ...

Financing entrepreneurship in different regions: The failure to decentralise financing to regional centres in Sweden

Purpose – The purpose of the paper is to analyse the financial search behaviour of small and medium‐sized enterprises (SMEs) in different regions and the perceived importance of different external financiers for these firms.Design/methodology/approach – A postal survey targeting the chief executive officers (CEOs) of 459 SMEs was distributed in different regions of Sweden.Findings – Large differences exist in the financial search behaviour exhibited by firms in the four different types of regions. In the metropolitan areas, firms are more active in searching for new owners, especially professional investors. In smaller municipalities, banks dominate as the most important financier.Research limitations/implications – The study might not be generalised for other settings because it was carried out in Sweden. Furthermore, the regional types used might cause some concern as to whether the findings can be generalised.Practical implications – The study provides evidence that policies need to be tailor‐made for ...

The effect of bridging networks on entrepreneurial activity: The rational‐legal framework and embeddedness in local social capital networks

Purpose - The purpose of this paper is to analyse the role of social capital and bridging networks on entrepreneurial activity in three different regions in Sweden. Design/methodology/approach - The empirical base of the paper comprises 120 in-depth interviews with entrepreneurs and other stakeholders in three municipalities in Sweden, statistical data from Statistics Sweden and a large postal survey conducted by the Confederation of Swedish Enterprises. Findings - The bridging networks between local civil servants and local politicians on the one hand and entrepreneurs on the other are pivotal for the development of an entrepreneurial community. Research limitations/implications - Despite the same rational-legal framework, this paper shows how the cognitive dimension of social capital influences the level of entrepreneurship in three municipalities. The importance of bridging networks is also highlighted. Practical implications - An open channel of communication between politicians and entrepreneurs allows the former to gain legitimacy in the eyes of the latter. By widening the network, more actors are involved in local and regional development, thereby raising the level of competence and resources. Originality/value - Using three different sets of data, this paper offers a deeper understanding into the complex nature of bridging networks between politics and business.

Buyer seller relationships in transition

ABSTRACT Two Russian case studies have been investigated by adopting a relationship marketing perspective and adding a new concept, that of relationship knowledge. Relationship knowledge is assumed to be the main condition for relationship success in terms of and is visible through the more efficient execution of activities and implementation of new resources. The conclusion is that in Russia, the inadequate levels of trust, commitment and business activity lead to low external knowledge of the counterpart, which hampers development.

The impact of corporate fairness on the bank-SME relationship

Purpose - The United Kingdom Financial Services Authoritys treating customers fairly initiative has drawn attention to a current trend that involves regulators using regulatory principles to enhance the relationship between financial institutions and customers. The term corporate fairness is introduced to facilitate the understanding of the construction of fairness. The purpose of this study is to investigate corporate fairness as a means of achieving customer satisfaction. Design/methodology/approach - This study is based on a sample of 359 small and medium-sized enterprises (SMEs) in Sweden. LISREL, a structural equation modelling technique, is used to analyse the empirical data. Findings - The present study emphasises the importance of treating customers fairly in the financial sector. By being embedded in the strategy and structure of the bank organisation, corporate fairness enables individual bankers to act in a relational manner towards their customers, thereby resulting in higher customer satisfaction. Originality/value - Corporate fairness is a topic usually reserved for consumer research, this study shows the impact of corporate fairness on the SME community. The study shows how corporate fairness is linked to customer satisfaction, and how perceived fairness can be improved.

The impact of investment readiness on investor commitment and market accessibility in SMEs

Abstract Raising the level of investment readiness in small and medium-sized enterprises (SMEs) is seen as one of the most important strategies in public policy for promoting entrepreneurship and SME growth in Europe. This paper analyzes the impact of investment readiness on investor commitment and market accessibility in Swedish SMEs. The empirical base for the paper is a survey answered by 459 SME owners. We have analyzed the data using the lineaz structural relations (LISREL) method, a structural equation modeling technique. The analysis indicates that an increased level of investment readiness in SMEs results in closer working relationships with financiers and a higher level of commitment by the investors, which in turn leads to greater mazket accessibility for SMEs. This study supports public policy focused on programs that alleviate the problems associated with the lack of investment readiness in SMEs.

The dissolution of corporate identity: Identity crisis in savings banks

Purpose - The purpose of the paper is to investigate identity change in savings banks. The savings bank movement is gradually shifting from a residual culture of using the bank to promote savings, into a dominant culture closely resembling commercial banks. Design/methodology/approach - Theory draws on key research in the field of organisational change and corporate identity. A qualitative methodology is used to investigate a large portion of the savings banks movement in Sweden. Findings - The shift in culture is a result of decreasing values of original visions, a process of commercialising the savings bank idea and increasing chief executive officer (CEO) influence and professionalisation. Research limitations/implications - The results are primarily applicable for savings banks. Practical implications - The paper shows the ongoing changes in the savings bank community and the effects of these changes on critical stakeholders. In particular, the important role of CEOs in non-profit organisations is illustrated and discussed. Originality/value - Few studies focus on change in culture and the consequences for stakeholder relations. There is no prior study on savings banks and organisational change.

The influence of banks' advice to SMEs on customer satisfaction: the case for regulation

The purpose of this paper is to analyse the expectations of Small- and Medium-sized Enterprises (SMEs) regarding the value of the advice provided by banks in the light of new regulations in the field. The study started with 60 in-depth interviews with bankers and entrepreneurs in a small municipality in Sweden. After the interviews, a postal survey was sent to 476 SME clients of a bank. The relationship between the bank and the SMEs was divided into two dimensions: the functional quality (with which the SMEs were very satisfied) and a technical quality (which received poor ratings from the SMEs). Overall, the corporate customers were quite satisfied with the bank, owing to low expectations in the first place. The study has relevance for regulatory authorities and banks in examining the customer satisfaction among SMEs. Furthermore, the paper provides a framework for understanding why banks can achieve high customer satisfaction despite the continuous criticism of the advice provided by banks.