Scaling Professional Service Microenterprises: Perceived Challenges and Opportunities

Abstract

Small and micro-sized companies are the backbone of economic growth and employment, and their strengths include flexibility, agility, and low bureaucracy. They act as economic buffers in crises and are more committed to their employees than large companies are. In addition, these enterprises create value for local communities, can serve niche markets flexibly, and act as dynamic innovation platforms. Despite their role in the economy and their status as the majority of businesses worldwide, microenterprises’ digital development and growth lag behind those of larger organizations. Paradoxically, despite their enormous potential, few microenterprises grow purposefully, and many deliberately avoid expansion. The study aimed to gain a deep understanding of the perceptions that Finnish professional service microentrepreneurs have of scaling and to identify the obstacles and opportunities that emerge in scaling their businesses. The study was conducted as a semi-structured interview with ten professional service microentrepreneurs. The collected data was analyzed through thematic analysis to gain a deep understanding of the experiences and perceptions of professional service microentrepreneurs.

The study found that professional service microentrepreneurs define scaling significantly more broadly than the traditional literature. Scaling is, above all, seen as a way to optimize resources and time autonomy. The most significant obstacle emerging from the data was the strong personification of expert work. Also, external factors such as unhealthy price competition and the inflexibility of legislation were identified as obstacles that hinder the desire to grow. Despite the obstacles, significant possibilities also emerged from the data. Extreme productization of expertise through digitalization was identified as the most promising way to scale a professional service business, as well as the utilization of AI and other digital solutions in daily routine tasks.

The research provided a thorough understanding of how professional service microentrepreneurs perceive scaling, as well as the obstacles and opportunities they face in scaling their businesses. Furthermore, the research contributes to the theory by giving insights into the needs and experiences of microentrepreneurs and how external parties can enhance the growth of professional service microentrepreneurs.