A Neural Network Approach to the Operational Strategic Determinants of market Value in High-Tech Oriented SMEs

The purpose of this paper is to present an adaptive performance model using backpropagation neural network (BPNN) in scrutinizing impact of strategic factors on firm performance, especially within high-tech SMEs in U.S. The novel design approach introduced in this paper segments SMEs into high and low performance groups and captures different impact patterns of strategic variables (e.g. R&D). This paper explores both explanatory and predictive capacity of a neural network and extends its application to the measurement of relative efficiency and subsequent prediction of potential improvement. This paper demonstrates effectiveness of a neural network for SME analysis and its potential advancement toward performance modeling as an adaptive decision support tool.