1st Edition

The Evolution of Business Interpretative Theory, History and Firm Growth

By Ellen Korsager Copyright 2019
    206 Pages
    by Routledge

    206 Pages
    by Routledge

    Firm growth. This concept has interested researchers for generations. Economists have sought to predict and measure firm growth using a host of different variables, while strategic management scholars depict growth as the result of clever analyses and rational resource exploitation. Entrepreneurship scholars - ever engrossed by successful start-ups - have pondered why growth sometimes comes fast and sometimes never at all, while the field of business history has given countless examples of growing firms in a range of different settings. Yet despite research across fields, our knowledge of how growth in a firm actually comes about is limited and we still know little about the process.



    This book offers a new reading of economist Edith Penrose’s The Theory of the Growth of the Firm. The bold statement is that although Penrose’s work - across fields and generations - is amongst the most quoted on firm growth, the basic points of her work have yet to be realized and explored empirically.



    Essentially, growth is created by a dynamic interrelation between the firm’s self-conception and its image of context. Based on these two subjective categories, the firm makes decisions and its actions lead it to develop along a particular path. To Penrose this is the basic engine that drives the growth and development of firms.



    This book discusses how the engine of firm growth can be captured in empirical analysis using interpretative theory and narrative methods inspired by recent streams of research in business history.

    1. Introduction



    Penrose and the historical study of firm growth



    Subjectivity, entrepreneurial attitude, and image of context



    The creation of meaning



    The social nature of meaning



    Change and Geertz’ concept of culture



    Thick Description and narratives



    The case of Fiberline and the use of empirical material





    2. Founding a company and formulating a basic narrative



    The circumstances of the start-up



    Pultrusion



    The basic narrative of Fiberline



    Establishing a proper motive and a founder



    Naming the product and the market



    Specifying the production process and constructing the birth of a company





    3. The prior experience of Henrik Thorning and the context of the Start-up



    The plastic industry in Denmark in the 1970s and start 80s



    The development of the composite industry in Denmark



    Environmental concerns and organizing the industry



    Dukadan and Henrik Thorning’s two years working there



    Jotun



    Innovation in the Danish plastic industry





    4. Putting resources to service and strengthening the basic narrative in the start-up process



    Getting started



    The first sales



    The everydayness of acute problems





     



     





    5. How should the profiles of Fiberline be sold?



    Pressure building



    Strong export growth of the Danish plastic industry



    A gradual focus on sales



    Standard profiles and distributors



    The origins of the international focus



    The narrative of how profiles should be sold and to whom





    6. The efforts of financing and opportunities for growth



    Continued pressure after 1983



    Financing behavior over time



    Bootstrapping and effectuation in financing behavior





    7. Productive opportunities and technological base



    The growth of Fiberline and of the Danish plastic industry from the mid-1980s until the late 1990s



    External inducements to diversification - Processed profiles and systems



    Internal inducements to diversification – phenol based profiles and construction profiles





    8. Market focus and developing the sales organization



    The composites industry around the turn of the millennium



    Seven good years of development and organization building



    Establishing the sales organization



    Diversification and uncertainty



    Sales and strategic plans in the early 1990s



    Operational systems and the strategic plans in the late 1990s





    9. Discussion



    The case of Fiberline and the theoretical choices I have made



    The study of firm growth and path dependency



    The study of business history



    The study of entrepreneurship



    The study of internationalization





    10. Conclusion

    Biography

    Ellen M. Korsager is an Assistant professor of business history at the Copenhagen Business School, Denmark.