The disruption of political instability and disease on local growth : An exploratory study of Swedish SMEs´ growth during a time of decrease in globalization

Abstract: Background: The current trend of a decrease in globalization has created a new scenario for SMEs, with increased protectionist measures and delivery issues, acting as an enabler or a disabler for growth. Therefore, understanding how SMEs are affected is vital, as 99.9% of all Swedish companies are SMEs, meaning that they are crucial for regional well-being. Researching the effect on the growth of SMEs could provide important insight into how SMEs could adapt and mitigate the effects of a decrease in globalization. This study investigates how a decrease in globalization affects the growth of SMEs, utilizing the literature on SME growth and the framework of external enablers. Purpose: This study aims to explore how a decrease in globalization affects the growth of SMEs. Method: The study follows an interpretivist approach through multiple case studies, by conducting semi-structured interviews. Further, the research uses an inductive approach. The empirical data was analyzed following the model by Gioia et al. (2013), where aggregated dimensions were identified. Conclusion: The empirical findings suggest that a decrease in globalization affected SMEs' growth directly through extrinsic events, value chain disruptions, and changes in internal strategies, and internal strategies were further affected by external events. The findings further suggest that the effects are dependent on the industry and the owners´ perception. Therefore, whether a decrease in globalization enables SME growth depends on the interactions between external events and the internal strategies of SMEs. This study contributes to the literature on SME growth and extends the external enabler framework to existing organizations.