Micro enterprises and their strategic choices in order to gain a competitive advantage : A case study focusing on the challenges and possibilities

The IT market is influenced with constant changes and a highly competitive environment between many different entities. In entrepreneurship, it is often the strategy that determines whether an organization successfully can establish itself and compete within a business area. It is a major challenge to successfully compete as a micro enterprise due to limited supply of resources. The aim of the study was thus to examine how micro enterprises handle strategic choices in order to gain competitive advantage on the IT market, as well as investigate the challenges and opportunities for a micro enterprise in their quest for competitiveness. The study was conducted through a qualitative interpretive case study. Semi-structured interviews were used to collect data from six respondents with different perspectives on entrepreneurship within micro enterprises. The six respondents represent four different micro enterprises and an incubator that offers strategic guidance for newly started IT companies. The result of the study presents that it is fairly easy to start competing within the IT market. It takes few resources to develop a concept and spread it to a wide range of potential customers. As a micro enterprise, the IT market is thus lucrative as it is easy and quick to penetrate. However, the market exists of constant threats from other newcomers. Small companies need a continual inflow of financial resources in order to be able to progress the business, which leads to high demands on the ability to quickly establish itself on the market. Large organizations can hardly be an efficient customer for micro enterprises because of their immobility. Strategy is generally handled scarcely within micro enterprises. The IT markets uncertainty and the constant changes makes it hard for micro enterprises to formalize pronounced strategies in the long term. It does however exist a strategic way of thinking within micro enterprises, although on an informal and improvisational level. On the other hand, strategies for both differentiation and segmentation are sought, sometimes in combination with each other. Micro enterprises in the IT market is driven by entrepreneurship and innovation, which results in the development of differentiated products and services. In a constantly changing market, micro enterprises have great opportunities to achieve flexibility and rapid mobility in a different manner compared to larger companies. Hence, micro enterprises can quickly react and adapt to the ever-changing world of IT