Previous research on the theme of strategy formation in small companies has found that these companies do not use a formal strategic planning process. Rather, they tend to use a more informal and opportunistic approach to strategy formulation. Instead of using a structured tool-kit-based approach to strategy, the results of this article show that small Internet service firms adopt a distinct process for strategy development. This process is based on three dimensions: incrementalism, informalism and networking. Furthermore, this study reveals that these companies do not use in a systematic way any of the academic tools conceived to support strategy development. These tools were perceived as too time consuming and, to a certain degree, unsuitable for adoption by the case-firms.
Strategy; Internet; e-business; small companies; informalism and strategy