What are high-technology firms and what drives their performance?

Technology is defined by Krajewski and Ritzman (2000, p. 17) as ‘the know-how, physical things, and procedures used to produce products and services’. Over the past two decades, the development of high-technology-based firms has been actively encouraged by governments and development agencies (Westhead & Storey, 1994) as a source of competitive advantage. In many cases, small high-technology-based firms have effectively exploited market opportunities. This has been helped by the emergence of generic technologies, most notably information technology that is knowledge intensive rather than capital and labour intensive (Rothwell, 1994, p. 12). Such technologies have been effectively used to open up new market niches for small- and medium-sized firms (SMEs). Accordingly, high-technology firms have become well established as sources of both competitiveness and employment creation (Oakey, 1991).