Hiring in high-growth firms: new study explores the timing of organizational changes

Researchers investigate how introduction of a new hierarchical layer in high-growth firms is connected with the timing of high-growth period

Waseda University

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Researchers try to understand the timing of the introduction of a hierarchical layer in a high-growth organization. The result sits in-between the two established theories, one highlighting the pre-planning method, while the other states that the organizational change happens only when it is unavoidable.

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Credit: Professor Alex Coad from Waseda University, Japan

High-growth firms (HGFs) refer to businesses that achieve rapid growth in terms of employees or revenue. Based on the established definition, HGFs are businesses with at least 10 employees and annual growth rates of 20% or more, observed over a period of three years. This three-year span is considered the high-growth (HG) period of the company. Even though this growth is often short-lived and difficult to sustain, it plays a significant role in driving economic dynamism. Hence, entrepreneurship-related research often focuses on the growth pattern of the HGFs and factors that affect the growth.

One such factor that affects the growth is the introduction of hierarchical layers. To shed light on the role of introducing hierarchical layers into HGFs, Professor Alex Coad from Waseda Business School, Waseda University, Japan, along with Dr. Antonio Martins-Neto, from the World Bank, Washington, D.C., USA, conducted a study based on the Brazilian employer–employee census micro-data for the period of 2003–2019. An article describing their research was published online in the journal Small Business Economics on September 11, 2025.

“There are two competing theories regarding the companies’ plans for the organizational infrastructure,” explains Prof. Coad. One theory talks about planning ahead, which highlights how firms plan ahead and invest proactively before the HG period. According to this theory, the companies invest in adding management layers in anticipation of growth. The other theory is called “dragging one’s feet.” This refers to the situation where firms put off adjusting their organizational structures for as long as possible. In these cases, the addition of a hierarchical layer often happens at the end of the HG period.

The researchers conducted a study which is entirely based on the Relação Anual de Informações Sociais (RAIS) database from 2003 to 2019. This comprehensive database is managed by the Brazilian Ministry of Labor and Employment and includes information on over 40 million individuals annually. The analysis was done based on 3,211,353 observations, and 2013 to 2016 was considered as the HG period (in the baseline analysis). The study followed the previously established classification of workers that included chief executive officers and managers, professionals, technicians, clerks and services, and production workers. Applying the difference-in-difference technique, the conditional correlations between firms’ growth and changes in their organizational structure were established based on the database to investigate the perfect “timing” for organizational restructuring.

“The findings of our study were interesting,” states  Prof. Coad. “The results neither fit closely to the ‘planning ahead’ scenario, nor did they fit the ‘dragging one’s feet’ theory.” The addition of the new hierarchical layer occurred neither at the start nor at the end. However, as the firms started to expand, the HGFs started to add new knowledge hierarchies until the point at which they ceased to grow. This change happens smoothly and uniformly.

A notable distinction in hiring patterns was also observed between bigger and smaller firms. Smaller firms, with fewer than 50 employees, tend to add layers soon after growth begins, highlighting the influence of size on organizational decisions. As the firms grow in size, the share of managers decreases, suggesting that firms have low levels of managerial resources at the end of an HG period. The number again goes up later on.

“Planning ahead too much can be a risky strategy. But then again, delaying as much as possible also has drawbacks. It is better to take the middle road,” explains Prof. Coad, while talking about the implication of the study. The study can give the policymakers a direction regarding supporting the firms during their growth phase, instead of seeking a proactive role. This might lead to further growth and development of the HGFs in the near future.

 

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Reference
Authors: Antonio Martins-Neto1, Alex Coad2
DOI: 10.1007/s11187-025-01098-z
Affiliations: 1World Bank, Washington, D.C., USA
2Waseda Business School, Waseda University, Shinjuku, Japan   

About Waseda University
Located in the heart of Tokyo, Waseda University is a leading private research university that has long been dedicated to academic excellence, innovative research, and civic engagement at both the local and global levels since 1882. The University has produced many changemakers in its history, including eight prime ministers and many leaders in business, science and technology, literature, sports, and film. Waseda has strong collaborations with overseas research institutions and is committed to advancing cutting-edge research and developing leaders who can contribute to the resolution of complex, global social issues. The University has set a target of achieving a zero-carbon campus by 2032, in line with the Sustainable Development Goals (SDGs) adopted by the United Nations in 2015. 
To learn more about Waseda University, visit https://www.waseda.jp/top/en  

About Professor Alex Coad from Waseda University, Japan
Alex Coad is a Professor at Waseda Business School in Tokyo, Japan, who specializes in business performance, entrepreneurship, strategy, and innovation policy. He earned a joint Ph.D. from Université Paris 1 Panthéon-Sorbonne and the Sant'Anna School in Pisa, Italy. Previously, he held academic positions at the Max Planck Institute, Aalborg University, and SPRU. He has more than 100 publications in international peer-reviewed journals, including Research Policy, Journal of Business Venturing, and Economica. He is associated as an Editor with the journals “Research Policy” and “Small Business Economics.” In 2016, he received the Nelson Prize at the University of California, Berkeley.

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Journal

Small Business Economics

DOI

10.1007/s11187-025-01098-z 

Method of Research

Data/statistical analysis

Subject of Research

Not applicable

Article Title

Planning ahead or dragging one’s feet? Organizational structure and high-growth events

COI Statement

The authors declare no competing interests. Participation declaration: Alex Coad is an Editor at “Small Business Economics” Journal.

HAPPY WORKER APP 😀

Boosting work engagement through a simple smartphone diary

Researchers develop and test a diary app that encourages positive reflections on daily work

Peer-Reviewed Publication

Keio University Global Research Institute

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This visual highlights how a smartphone diary promoting daily reflection influenced work engagement in a clinical trial.

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Credit: Professor Akihito Shimazu from Keio University, Japan

Work engagement is a positive and persistent state of mind related to one’s work. It is characterized by high energy and mental resilience (vigor), enthusiasm and involvement (dedication), and complete concentration in the task at hand (absorption). Engaged workers are not merely more productive; they are more likely to be proactive, creative, and less susceptible to burnout. Most importantly, work engagement has been consistently linked to many health benefits and overall well-being.

Despite its relevance for both organizations and workers alike, there aren’t many scientifically proven strategies for improving work engagement. Simple methods—ones that can be easily adopted in daily life—are virtually nonexistent. For countries like Japan, where long working hours and work-related mental health issues are common, there is a pressing need to develop tools to help employees feel positive about their job.

Against this backdrop, a research team led by Professor Akihito Shimazu from Keio University, Japan, developed a practical solution. In their latest paper, published in the Volume 13 of the journal JMIR mHealth and uHealth, on September 25, 2025, the team presents a new app called WEDiary, a smartphone-based diary that promotes positive reflections in daily working life on work engagement. The study was authored by Mr. Masahito Tokita and co-authored by Professor Akihito Shimazu, Mr. Shuichiro Kobayashi, and Mr. Daisuke Miyanaka from Keio University; Mr. Nobuyuki Takate and Mr. Hiroyuki Nakano from Japan Productivity Center; and Mr. Kazuki Takeuchi from Labor Trust LCC.

To test their app, the team conducted a randomized controlled trial involving 600 Japanese workers, who were split evenly between an intervention group and a control group. Participants in the intervention group used WEDiary for 2 weeks. They had to set a weekly goal at the beginning of each week and fill in their work achievements at the end of each day. The app specifically prompted them to type in their successes rather than any shortcomings, promoting positive reflection. “Through consistent engagement with this reflective practice, we expected participants to cultivate and accumulate positive emotions over time,” explains Mr. Tokita, “The transient experience of isolated positive emotions alone is insufficient for resource building toward work engagement. Instead, sustained accumulation of such emotions is essential, which is the goal of WEDiary.”

Through follow-up surveys, the team evaluated the effectiveness of their approach, obtaining very promising results. “Our app significantly improved employees’ work engagement in terms of vigor and dedication. Notably, these improvements were observed after just 2 weeks of intervention and persisted for 3 weeks post-intervention,” highlights Mr. Tokita. These findings showcase the potential of a simple, self-guided tool to effectively support workers’ psychological well-being by fostering work engagement.

A key advantage of WEDiary is its ease of use and adoption. It can be seamlessly incorporated into corporate wellness programs as a tool for mental health support. Similarly, it may be equally effective in remote and flexible working contexts, supporting self-management and engagement outside of traditional office settings. “Given its low cost and scalability, WEDiary could benefit a wide range of organizations, including small- and medium-sized enterprises and the public sector,” concludes Prof. Shimazu, “Ultimately, it addresses pressing challenges in Japanese society, such as long working hours and mental health issues, while fostering sustainable engagement in the workplace.”

Further innovations in tools that increase work engagement will hopefully pave the way for a healthier society.

 

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Reference

DOI: 10.2196/55664

 

About Keio University Global Research Institute (KGRI), Japan
The Keio University Global Research Institute (KGRI) was established in November 2016 as a research organization to bridge faculties and graduate schools across the university. KGRI aims to promote interdisciplinary and international collaborative research that goes beyond the boundaries of singular academic disciplines and international borders. It also aims to share research outcomes both in Japan and worldwide, further promoting engagement in joint research. To enhance those activities above, in 2022, Keio University set its goal of becoming a “Research university that forges the common sense of the future”.

Website: https://www.kgri.keio.ac.jp/en/index.html

 

About Professor Akihito Shimazu from Keio University
Akihito Shimazu is Professor of the Faculty of Policy Management at Keio University. He is qualified as a clinical psychologist and a national licensed psychologist in Japan. His research concerns workplace psychosocial factors and mental health. He has published 11 edited books and over 300 papers/book chapters.

https://en.hp3.jp/

https://researchmap.jp/read0058233?lang=en

 

About Senior Researcher Masahito Tokita from Keio University SFC
Masahito Tokita is a Senior Researcher at Keio University SFC (Keio Research Institute at SFC: KRIS). He is a national licensed nurse and a national licensed mental health social worker in Japan. His research concerns workers’ well-being and mental health.

 

Funding information
This research was funded by a grant from the Japan Productivity Center.

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Journal

JMIR mhealth and uhealth

DOI

10.2196/55664 

Method of Research

Randomized controlled/clinical trial

Subject of Research

People

Article Title

Effects of a Smartphone-Based Positive Reflection Diary on Work Engagement Among Japanese Workers: A Randomized Controlled Trial

COI Statement

The authors declare that this research was funded by a grant from the Japan Productivity Center, to which the co-authors NT and HN belong, which could be construed as a potential conflict of interest. Co-author DM manages Better Options, Inc., which did not fund this research. The remaining authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.

DON'T WORRY, BE HAPPY

 

Climate change may create ‘ecological trap’ for species who can’t adapt

Frogs use day length to cue winter prep even when temperatures don’t get colder, according to new research from Case Western Reserve University

Case Western Reserve University

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Adult gray tree frog on a blade of grass.

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Credit: Troy Neptune / Case Western Reserve University

CLEVELAND—Even as autumn days grow shorter, a warming climate means Ohio winters aren't as cold as they were just a few decades ago, according to National Oceanic and Atmospheric Administration data.

This increasing mismatch between hours of daylight and temperature could spell trouble for animals that thrive by relying on seasonal cues to prepare their bodies for winter, according to new research from Case Western Reserve University.

Scientists studying gray tree frogs—a species that survives freezing temperatures by storing “antifreeze” compounds in their bodies—have discovered that these amphibians naturally begin to prepare for winter by responding to shorter days rather than colder temperatures.

“This means they may be allocating precious energy resources toward winter preparation they don’t actually need,” said Michael Benard, professor and chair of the biology department at Case Western Reserve in whose laboratory the study took place. “The broader implication is that species with overwintering strategies cued by day length may prepare for winter too soon and respond poorly to climate change.”

The findings were published online in “Early View” in September in the Journal of Animal Ecology.

The research was the result of the BioScience Alliance, an internationally recognized program in biological research and student training involving Case Western Reserve, Cleveland Metroparks Zoo and Holden Arboretum.

Manipulating nature's clock

Gray tree frogs survive winter by freezing solid and thawing when the weather warms up. (They do this by storing glycogen in their livers, later converted to glycerol that is pumped throughout their bodies to prevent cells from bursting in freezing temperatures.)

To understand how frogs are cued to store glycogen, researchers manipulated how much daylight tadpoles and later young frogs experienced. They simulated days getting longer (between April and June), days getting shorter (between August and November) and normal day length (July to September) as a control group. All the frogs were kept at the same temperature.

The results were dramatic: Frogs exposed to a simulated fall stored as much as 14 times the amount of glycogen compared to other frogs. Since glycogen is stored in the liver, their livers increased to three to four times the size of frogs in other groups. These winter-prepped frogs were also smaller overall and grew more slowly.

‘Ecological trap’ in the making

Species that adapt their behavior according to day length to prepare for colder temperatures may find themselves caught in what scientists call an “ecological trap” as the climate warms. This ecological trap could affect many critical behaviors, including breeding cycles and migration patterns.

“There was a significant reduction in growth; they’re not eating as much, and what they are eating they are allocating toward glycogen storage in the liver as opposed to bone or muscle growth,” said Troy Neptune, who led the research as part of his doctorate at Case Western Reserve and will continue his research on light and biology on a Fulbright Fellowship at the Doñana Biological Station in Spain.

“We haven’t seen a population crash or anything with gray tree frogs, and they are widely distributed in the U.S.,” he said. “But for other species that may be more geographically constrained, this kind of mismatch in the timing of behavior related to the environment could be catastrophic.”

Innovative research methods

The research was conducted using a unique combination of facilities at Case Western Reserve and the zoo. To manipulate daylight, researchers covered and uncovered outdoor pools with light-blocking covers at the University Farm Biology Research Field Station in Hunting Valley, Ohio. When tadpoles metamorphosed into frogs, they were brought into laboratory settings where lights were automatically controlled.

“This work is a great example of how our unique collaboration is leveraging our collective resources to help solve some of the most pressing conservation challenges,” said Diana Koester, adjunct assistant professor of biology at Case Western Reserve and a curator of research at the Cleveland Metroparks Zoo. Koester oversaw research conducted at the zoo, where Neptune used special techniques normally used by scientists to assess zoo animal health and well-being to measure glycogen levels in the frogs’ livers.

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As one of the fastest-growing research universities in the United States, Case Western Reserve University is a force in career-defining education and life-changing research. Across our campus, more than 12,000 students from around the world converge to seek knowledge, find solutions and accelerate their impact. They learn from and collaborate with faculty members renowned for expertise in medicine, engineering, science, law, management, dental medicine, nursing, social work and the arts. And with our location in Cleveland—a hub of cultural, business and healthcare activity—our students gain unparalleled access to academic, research, clinical and entrepreneurial opportunities that prepare them to join our network of more than 125,000 alumni worldwide. Visit case.edu to see why Case Western Reserve University is built for those driven to be a force in the world.

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Journal

Journal of Animal Ecology

DOI

10.1111/1365-2656.70125 

Article Title

Freeze-tolerant frogs accumulate cryoprotectants using photoperiod: A potential ecological trap

Members of the Bioscience Alliance tour the University Farm Biology Field Station and tadpole experimental pond.



Troy Neptune and one of the experimental ponds at University Farm Biology Research Field Station.

Adult gray tree frog

Credit
Troy Neptune/Case Western Reserve University