Organizational Lifecycle Dynamics, Intellectual Capital, and Strategic Human Resource Management in Small and Medium Enterprises: An Integrative Theoretical and Empirical Inquiry

Abstract

Small and medium enterprises (SMEs) represent the backbone of most national economies, particularly in developing and emerging contexts where they contribute significantly to employment generation, innovation diffusion, and socio-economic stability. Despite their importance, SMEs continue to face persistent challenges related to survival, growth, competitiveness, and sustainability. A substantial proportion of these challenges can be traced to internal organizational dynamics, especially those associated with lifecycle stages, intellectual capital development, and strategic human resource management (SHRM). While prior research has examined these domains independently, there remains a notable lack of integrative scholarship that systematically connects organizational lifecycle theory, intellectual capital theory, and human resource management practices within the SME context.

This study develops a comprehensive, theory-driven research framework that explains SME performance and survival through the interaction of organizational lifecycle stages, intellectual capital components, and human resource management systems. Drawing strictly on established theoretical and empirical insights from the provided literature, this article synthesizes organizational lifecycle theory, the resource-based view of the firm, intellectual capital theory, and strategic human resource management perspectives. Through an extensive qualitative and conceptual methodological approach, the study explores how SMEs evolve across lifecycle stages, how intellectual capital is accumulated and leveraged at each stage, and how human resource practices mediate and moderate these relationships.

The findings reveal that SMEs’ performance trajectories are deeply shaped by their ability to align human resource systems with lifecycle-specific challenges and intellectual capital requirements. Early-stage SMEs struggle primarily with liabilities of newness and limited human capital depth, while growth-stage SMEs face increasing complexity in managing knowledge, relationships, and organizational routines. Mature SMEs, conversely, encounter risks of rigidity and underutilization of intellectual capital. Strategic human resource management emerges as a critical mechanism through which intellectual capital is developed, protected, and transformed into sustained competitive advantage.

The study contributes to theory by offering an integrative model that bridges fragmented literatures and provides a nuanced understanding of SME development. Practically, it offers actionable insights for SME owners, managers, consultants, and policymakers seeking to design human resource systems that support long-term organizational viability. The article concludes by discussing limitations, future research directions, and implications for SME consulting and policy interventions.