An analytical model for human resource management as an enabler of organizational renewal: a framework for corporate entrepreneurship

This article presents the development of a model of types of work based on organizational theory. It analyzes the different characteristics of work and efficient forms of Management, and joins all these aspects together in terms of corporate entrepreneurship. Organizational theory provides the instruments needed to manage work, the causes that make decentralization desirable and the technical, social and institutional mechanisms for its control. The literature on corporate entrepreneurship provides material for forms of discovery or creation of opportunities based on accumulated experience in the firm, on the collective relationships linked to entrepreneurship and on the way in which resources are managed. This article contributes to existing knowledge by systematically addressing these two fields, showing how the instruments that allow for the efficient management of work are the same as those necessary for corporate entrepreneurship and how the efficient management of work is a prerequisite and an enabler of entrepreneurial activity.     

Does organization capital matter? An analysis of the performance implications of CEO power

Chief executive officer (CEO) power reflects the ability of the CEO to influence the firm's decision-making. Whether the CEO of the firm could manage the firm’s investment assets to support maximizing the efficiency of resource allocation is an important issue. As previous studies found, organization capital is a key intangible asset that improves the firm’s production efficiency and affects long-term performance. This study explores how CEO power affects organization capital investments and how it further affects the efficiency of firm resource allocation. We use the following three variables to measure CEO power: CEO founder, CEO-only insider and CEO duality. Our results indicate that the level of CEO power can influence a firm’s value by controlling the organization capital. When the firm’s CEO is also the founder, the CEO will attempt to increase investments in organization capital to create growth opportunities for the firm, which will therefore increase the firm's value. Specifically, when the company is in financial distress, the powerful CEO's increasing in organizational capital investment will expose the company to greater risk of loss of intangible assets. This result may further increase the company's price volatility.     

The Context of Entrepreneurial Judgment: Organizations,Markets, and Institutions

The economics and management literatures pay increasing attention to the technological, competitive, and institutional environment for entrepreneurship. However, less is known about how context influences the judgment of entrepreneurs. Focusing on the emerging judgment‐based approach to entrepreneurship, we argue that economics can say much about how the organizational, market, and institutional context shapes entrepreneurial judgment. We describe entrepreneurs as individuals who deploy scarce, heterogeneous resources to service customer preferences at a profit. Because of uncertainty, this process is essentially experimental, and context influences the experimental process. Thus, entrepreneurs will seek to design the internal organization of the firm so that it facilitates internal experimentation. Moreover, the market or task environment determines the need for experimentation (e.g., how fast do consumer preferences change, how does technology evolve, which assets are available at which terms, etc.). Finally, the institutional environment influences, for example, the transaction costs of acquiring and divesting assets as firms adjust their boundaries through ongoing commercial experimentation.     

Managing multidimensional knowledge assets: HR configurations in professional service firms

The purpose of this article is to illustrate empirically how HR practices are configured to manage multidimensional knowledge assets. It contributes directly to the configurational approaches to HRM by identifying HRM systems that are used to manage various types of knowledge assets. First, we develop a framework from theory to categorise knowledge assets into human (industry and firm specific), social (entrepreneurial and co‐operative) and organisational capital (mechanistic and organic). Within this framework, we draw on data gathered in the 12 professional services firms to understand how HR practices enable the management of each knowledge asset. We identify two configurations of HR practices (organisationally and professionally focused). These configurations do not exist in isolation but are used simultaneously by organisations via either a targeted (different practices in different parts of the organisation) or a temporally segregated way (different practices for the same group of employees over time).     

Resources,Capabilities and Entrepreneurial Perceptions*

abstract We review and develop a subjectivist theory of entrepreneurship that focuses on individuals, their knowledge, resources and skills, and the processes of discovery and creativity, which constitute the heart of entrepreneurship. First, we establish the fundamental importance of subjectivity in entrepreneurial discovery and creativity. Second, we build on Penrose (1959 ) to elaborate how entrepreneurs' perceptions and personal knowledge shape a firm's subjective productive opportunity set. Third, we explain that entrepreneurial perceptions and knowledge partly originate from entrepreneurs' experiences in specific business settings such as the firm, the management team, and the industry. Fourth, we highlight the causal connections between subjectivity in entrepreneurship and observed heterogeneity in firm‐level economic performance. Lastly, we suggest directions for further advancing a subjectivist resource‐based approach to future entrepreneurship research.     

The emergence of bifurcation bias from unbalanced families: Examining HR practices in the family firm using circumplex theory

Family firm human resource (HR) research focuses largely on examining differences in HR practices between family and nonfamily firms or between family and nonfamily employees within family firms. Few studies, however, attempt to explain why these differences emerge. We offer insight into the source of heterogeneous HR practices by investigating attributes of the owning family. We integrate a primary family science perspective, circumplex theory, to describe how an unbalanced family structure leads to unbalanced HR systems in the family firm. An unbalanced HR system is depicted as a form of bifurcation bias, or the asymmetric treatment of family and nonfamily employees via the family firm's HR practices. By integrating and extending circumplex theory into the family firm, insight is offered into how the structure of the family system influences the structure of the family business HR system, thus impacting firm outcomes. Implications for both scholars and practitioners are offered.     

Pursuing sustainable development through green entrepreneurship: An institutional perspective

Pursuing sustainable development through green entrepreneurship has been advocated, conceptualized, and empirically examined in the recent environmental management and entrepreneurship literature. However, green entrepreneurs are embedded in institutional environments that may discourage them from embracing sustainable development because of the “paradox of embedded agency.” How can a firm overcome the liability of such an agency issue and escape what has become known as a “green prison”? This study proposes that, because international venturing exposes firms to foreign institutions, it provides them with opportunities for institutional learning. Thus, we examine how international venturing influences green entrepreneurship which, in turn, impacts firm performance. Specifically, based on institutional theory, this study develops a firm-level green entrepreneurship framework with three dimensions: green initiatives (a firm's active adoption of green practices), received government green support (benefits that a firm gains from the government by adapting to governmental incentives, programs, and policies related to green practices), and green political influence (a firm's attempts to influence legislation that enacts laws, rules, and regulations related to green practices). The results obtained by analyzing 152 firms that engage in international venturing activities and 151 firms that do not show that international venturing is positively associated with green initiatives and government green support while these two factors further directly enhance firm performance and mediate the effects of international venturing on performance.     

Theory and history in marketing

This article presents a theoretical foundation for marketing based on the ideas of the Austrian school of economists. After a discussion of the methodological foundations of Austrian economics, which reject the statistical and experimental methods of the physical sciences as the means to verify theory in the social sciences, the article presents the Austrians' principle of methodological individualism, which provides the basis for a theory of entrepreneurship and marketing.     

Telling their own stories: Māori entrepreneurship in the mainstream screen industry

We examined how factors from Indigenous entrepreneurship research (social capital, cultural capital, self-efficacy) help explain the high level of Māori entrepreneurial performance in the mainstream screen industry. Results, based on ten case studies and a one-year series of structured interviews, extend prior research by showing that these Indigenous entrepreneurs benefit jointly from two forms of capital: cultural and social. We found high levels of both forms to increase the desire for emancipation of cultural and community identity – not just individual identity – through entrepreneurship. Self-efficacy and storytelling helped ameliorate discontinuities across Indigenous and mainstream contexts. Our research sheds new light on how Indigenous ventures can pursue mainstream entrepreneurship while maintaining cultural identity. It also makes several distinct contributions to the Indigenous entrepreneurship literature. First, it provides an integrative theoretic review. Second, it illustrates a culturally appropriate methodology for researching Māori entrepreneurs with implications for other Indigenous communities. Third, it proposes cultural capital and social capital as a two-part framework for explaining Indigenous entrepreneurial action. Fourth, it shows how entrepreneurship can be empowering for Indigenous communities. Finally, our paper demonstrates that entrepreneurship is a promising mechanism for preserving and promoting the cultures of Māori and other Indigenous peoples.     

THE EFFECTS OF HUMAN CAPITAL INTERVENTIONS ON ENTREPRENEURIAL PERFORMANCE IN INDUSTRIALIZED COUNTRIES

This paper provides a systematic review of studies on the effects of human capital interventions on entrepreneurial performance in industrialized countries. We identify 21 experimental and quasi‐experimental studies published before September 2018. These studies examine the effects of business training, formal education, and entrepreneurship education. Their performance outcomes include firm profits, firm size, and entrepreneurial earnings. The main finding across these studies is that these interventions do not have statistically significant effects. Formal education is the only exception, showing positive effects on firm profits and entrepreneurial earnings, yet these effects are small in magnitude. Evidence is inconclusive regarding effect duration. These findings stand in stark contrast to correlational studies, which tend to find large positive correlations between human capital interventions and entrepreneurial performance. We therefore conclude that correlational studies tend to overestimate the benefits of human capital interventions. Moreover, our estimates show that the interventions are associated with moderately low additionality.     

Linking top management team age heterogeneity to firm performance: juxtaposing two mid-range theories

Previous research on top management team heterogeneity and firm performance has focused almost exclusively on the non-visible attributes (e.g. functional background, tenure) of cultural diversity as opposed to the visible attributes (e.g. age, race and gender). The few studies there are show inconsistent results. For example, most field work - consistent with social identity theory notions - shows that cultural diversity, in isolation has negative organizational consequences. Only a few laboratory studies, however - consistent with information and decision-making theories - show that diversity in groups relates to favourable organizational outcomes. As social identity theory suggests, we find that top management team (TMT) age heterogeneity, in isolation, relates negatively to return on assets. On sales growth (i.e. organizational growth), the relationship is positive, lending support for information and decision-making theories. However, we find a curvilinear relationship between TMT age heterogeneity and sales growth, supporting both the mid-range theories. More specifically, TMT age heterogeneity is positively related to sales growth at low and medium levels and negatively related to sales growth at high levels. In addition, results reveal that context moderates linear and non-linear relationships. The results provide evidence of the importance of cultural diversity in TMTs for competitive advantage but also suggest the complexities of increasing it to observe these benefits.     

A strategic human resource perspective of firm competitive behavior

Embedded within firms are unique stores of intangible human assets that likely influence the way firms compete. We argue that the human and social capital of a firm, particularly at the upper echelon and board of director (BOD) levels, contribute to the firm's awareness of the competitive environment and its motivation and ability to undertake numerous, complex, and forceful competitive actions. We also suggest that the firm's executive compensation systems moderate the effects of these intangible human assets on firm competitive behavior. By examining how human capital, intra-firm social capital, and executive compensation influence firm competitive behavior, we advance a strategic HRM perspective of firm competitive behavior and outline several implications for future research.     

Heterogeneity and Time

A bstract .   Although heterogeneity and time are central aspects of economic activity, it was predominantly the Austrian School of economics that emphasized these two aspects. In this paper we argue that the explicit consideration of heterogeneity and time is of increasing importance due to the increasing environmental and resource problems faced by humankind today. It is shown that neo-Austrian capital theory, which revived Austrian ideas employing a formal approach in the 1970s, is not only well suited to address issues of structural change and of accompanying unemployment induced by technical progress but also can be employed for an encompassing ecological-economic analysis demanded by ecological economics. However, complexity, uncertainty, and real ignorance limit the applicability of formal economic analysis. Therefore, we conclude that economic analysis has to be supplemented by considerations of political philosophy.     

Management theories linking individual and organizational level analysis in entrepreneurship research

This paper carries out a bibliographical review of the evolution of the individual level research, the new individual approaches and analyzes possible methods for the extension of entrepreneurship research to the organizational level. We also discuss about the suitability of the resource based view and network approaches. We review the management theories and paradigms which are capable of incorporating and linking individual and organizational level studies to the external context where entrepreneurs compete and seek opportunities. In this sense we refer to the resource based view and the network theory as they have been deemed the most adequate to incorporate micro level theories through a convergence of concepts, rather than by a combination or confrontation of ideas. The linking concepts of the individual and firm level theories are presented as an evolution of entrepreneurship research in a specific direction, showing the common ideas shared in the convergent point.     

Capital Is Not Enough: Innovation in Developing Economies

Economic development and social entrepreneurship often conceive of poverty as a resource allocation problem in which a lack of capital prevents the poor from increasing their income through entrepreneurship. This allocative view, however, represents only one possible approach to conceptualizing entrepreneurial opportunity. The alternative discovery‐ and creativity‐based views place a greater emphasis on innovation which implies that superior ideas are also needed if poverty is to be reduced through firm performance. Drawing from a survey of 201 small business owners involved in a microcredit programme in Nairobi, Kenya, we find that the financial, social, human capital–performance relationships are mediated in part by innovation. Further, we find that differentiation‐related innovations lead to better firm performance than novelty‐related innovations.     

New business creation and regional development: Enhancing resource acquisition in areas of social deprivation

Over 7 years, the UK-Government funded an entrepreneurship scholarship scheme in the most deprived regions of England. This study examines how, for 211 of these nascent entrepreneurs, bootstrapping compensated for their inability to obtain debt or equity funding. Results show that social capital (strong, weak and brokerage ties) is important for access to bootstrapped resources. While human capital, including previous business experience and financial skills, are linked to joint-utilisation approaches to bootstrapping, higher financial investment is linked to owner- and payment-related approaches. A key outcome for developing appropriate regional policy is that ‘brokers’ provide a link between socially disadvantaged entrepreneurs and external resources.     

Strategic HR system differentiation between jobs: The effects on firm performance and employee outcomes

The purpose of this research was to understand whether firms apply different human resource management systems to different occupations within the same organization (HR differentiation) and how the extent to which they do so may influence firm and employee outcomes. We conducted two studies pertaining to these questions. The first study was based on data collected from managers, and the results suggest that firms differentiate their HR investments based on the strategic value of occupations to the firm, which was further associated with the human capital of those occupations. Differentiation in human capital was also associated with firm performance. The second study was based on data obtained from nonmanagement employees. The findings indicated that employees who were recipients of less HR system investment had lower fairness perceptions, which were further associated with higher turnover intentions and lower organizational citizenship behavior. Although the evidence from these studies suggests that firms may realize benefits from strategic HR system differentiation, managers should carefully consider how to balance the effects of differentiation on firm performance and employee well‐being before implementing such systems.     

Heterogeneous networks and resource acquisition of SMEs in emerging economies

It is acknowledged that social capital plays an important role in the growth of entrepreneurial firms. However, few studies have examined the contribution and function of social capital networks that contain structural holes (heterogeneous networks) in emerging economies. It is not clear how trustworthiness and behavioural commitment impact on effectiveness of these networks in obtaining resources. This study explores how heterogeneous networks characterize successful entrepreneurship of small-medium enterprises in such setting. We find that behavioural commitment moderates the relationship between heterogeneous networks and resource acquisition, while trustworthiness does not significantly moderate this relationship. The impact of the findings on the literature and practice in emerging economies is discussed, as is the need for future research in this domain.     

Return on Marketing–Eine Bestandsaufnahme empirischer Befunde

Difficult economic situations and the corresponding share price drops have increased the pressure on all functions within an organization to provide evidence how effectively they are contributing to a company’s financial performance in the sense of the shareholder value concept. Especially the marketing department quite frequently is on the watch due to its rarely manifest direct impact on firm success. Hence, for several years the topic ‘Return on Marketing’ has been ranging on top of the research priority lists of the leading scientific marketing organizations. Consequently, a variety of scholarly publications has analyzed the impact of marketing by means of capital market based approaches. Recently, finance methods seem to become a gold-standard in marketing research. In the present paper current empirical studies are systematically identified and analyzed in order to provide a detailed overview of this research topic. Furthermore a discussion and reflection of the findings with regard to communalities, divergences and applied research methodologies used is provided. The paper concludes by revealing (methodological) limitations and provides directions for further research.     

Irreversible investment and capacity choice with Bayesian learning

This paper incorporates information incompleteness into the standard capacity choice model. The firm dynamically updates its belief about the expected growth rate based on the realization of demand shocks. First, the firm’s expansion decision becomes more conservative in the dynamic updating case. Moreover, a myopic firm always overestimates the marginal value of capital but underestimates firm value. When we decompose the firm value into the value of assets in place and growth opportunities, dynamic learning significantly increases the value of growth opportunities rather than that of assets in place. Finally, the implications for the user cost of capital is also examined.