Theories of the Firm and their Value Creation Assumptions

Since Coase’s (1937) seminal paper on ‘The Nature of the Firm’, strategy scholars are invested in developing so-called ‘theories of the firm’ (ToFs). These are theories that should answer four questions on the nature of firms: Why do firms exist? Why are their boundaries as they are? Why are they organized the way they are? and Why are they so heterogeneous? In answering these questions, at least twenty ToFs have been put forward in the last decades. These include economics-based ToFs such as principal-agent theory and transaction-cost economics; organization theory-based ToFs such as behavioral theory and bureaucratic theory; and strategy-based ToFs such as the value-chain model and stakeholder theory. Assuming that all ToFs attempt to answer the four questions above, the question arises why we would need so many ToFs. Do we really need so many? And, if so, why? The extant literature provides a partial answer to this question by looking at complementarities between ToFs. Along that line, scholars have suggested to combine various ToFs (e.g., Coff, 1999; Foss & Foss, 2005; Pitelis, 2007). However, as these suggestions typically concern the combination of two or of three ToFs, they do not account for the fact that we have at least twenty now. Also more comprehensive reviews (e.g., Conner, 1991; Foss, 1993; Madhok, 2002) do not explain the multitude of ToFs in our literature. To find an answer to this question, this paper provides a two-step comparison of ToFs. The first step is a bird’s eye view comparison of eighteen well-known ToFs along some apparent differences. This step reveals differences between some ToFs, but it also leaves a group of ToFs that are apparently similar. In the second step we further compare this group of ToFs on their more implicit assumptions. Based on this two-step comparison, we conclude that we do indeed need a variety of ToF. The reason is that the various ToFs have different assumptions on how firms create value and from which sources this value is derived. Since firms in practice also differ in the way they create value, our conclusion is that we need more than one ToF to explain this variety. The implication is that scholars engaged in the ToF debate may want to put firm value creation center stage. This, we shall argue, requires adding a fifth question to the ToF that precedes the other four questions: what value does a firm create

Entrepreneurial cognition of the business model construct:A mixed methods study of stem and non-stem entrepreneurs

Applying the theory of socially situated cognition, we study how entrepreneurs cognitively process the business model construct during the early stages of launching technology-based new ventures. Through an abductive reasoning procedure, we aggregate four underlying socially situated cognitive functions of the business model and describe how these functions facilitate opportunity development. We examine if the entrepreneur’s educational background (STEM vs non-STEM) influences their cognitive processing of the construct. We discuss the contribution of our study to the literature on managerial cognition, business models, and to practice in detail

"Yes and. . ., but wait. . ., heck no!":A socially situated cognitive approach towards understanding how startup entrepreneurs process critical feedback

We examine sensebreaking, a meaning void, that entrepreneurs experience due to critical feedback from early stakeholders using the socially situated cognition perspective. We show that sensebreaking aids novel sensemaking via three mechanisms-redirecting, reframing, and questioning-through longitudinal analysis of weekly diary reports that we collected from 30 entrepreneurs for one year. We describe the cognitive changes due to novel sensemaking. We derive a process model that illustrates how sensebreaking-sensemaking iterations over time effect changes to the shared cognition between entrepreneurs and their stakeholders while driving opportunity development. We advance the opportunity coconstruction literature by adding microlevel understanding of stakeholder interactions and explicating their effects on entrepreneurial cognition

Entrepreneurial cognition of the business model construct:A mixed methods study of stem and non-stem entrepreneurs

Applying the theory of socially situated cognition, we study how entrepreneurs cognitively process the business model construct during the early stages of launching technology-based new ventures. Through an abductive reasoning procedure, we aggregate four underlying socially situated cognitive functions of the business model and describe how these functions facilitate opportunity development. We examine if the entrepreneur’s educational background (STEM vs non-STEM) influences their cognitive processing of the construct. We discuss the contribution of our study to the literature on managerial cognition, business models, and to practice in detail

Entrepreneurial cognition of the business model construct:A mixed methods study of stem and non-stem entrepreneurs

Applying the theory of socially situated cognition, we study how entrepreneurs cognitively process the business model construct during the early stages of launching technology-based new ventures. Through an abductive reasoning procedure, we aggregate four underlying socially situated cognitive functions of the business model and describe how these functions facilitate opportunity development. We examine if the entrepreneur’s educational background (STEM vs non-STEM) influences their cognitive processing of the construct. We discuss the contribution of our study to the literature on managerial cognition, business models, and to practice in detail

Challenges in the delivery of e-government through kiosks

Kiosks are increasingly being heralded as a technology through which governments, government departments and local authorities or municipalities can engage with citizens. In particular, they have attractions in their potential to bridge the digital divide. There is some evidence to suggest that the citizen uptake of kiosks and indeed other channels for e-government, such as web sites, is slow, although studies on the use of kiosks for health information provision offer some interesting perspectives on user behaviour with kiosk technology. This article argues that the delivery of e-government through kiosks presents a number of strategic challenges, which will need to be negotiated over the next few years in order that kiosk applications are successful in enhancing accessibility to and engagement with e-government. The article suggests that this involves consideration of: the applications to be delivered through a kiosk; one stop shop service and knowledge architectures; mechanisms for citizen identification; and, the integration of kiosks within the total interface between public bodies and their communities. The article concludes by outlining development and research agendas in each of these areas.</p