The importance of community values in small business strategy formation: Evidence from rural Iowa

The aim of this research was to test whether small business owners and mang ers could be clustered on the community, and whether cluster designation wa s significantly related to the kind of business strategies employed. Little is known empirically about aspects of social responsibility relating to sm all business operators' regard for community and strategic planning. In thi s study, community values and management strategies were measured by the se lf-reports of 1,008 small business operators in 10 rural Iowa communities. Cluster analysis revealed three categories of business operators distinguis hed by high, medium, and low levels of community values. Operators in the h igh community values cluster were found to vary significantly with regard t o personal and business characteristics from operators in the other two clu sters. Clusters with high and medium community values differed from the low community values cluster with regard to eleven business strategies. This a nalysis indicates that business owner/managers in small towns differ in the ir reported levels of community values, and that those values are associate d with their evaluation of the importance of various strategies for success .