Entrepreneurial performance of early-stage ventures: dynamic resource management for development and growth

Effective allocation of resources for the development and growth of early-stage ventures (ESVs) is a continuous challenge for their equity stakeholders. This paper explores the relevance of intellectual capital (IC) as a critical resource for entrepreneurial performance in ESVs driven by new knowledge development and technological innovation. An interdisciplinary literature review is conducted to examine prior studies on entrepreneurial performance and resource management for ESVs. A conceptual framework is developed using a taxonomy of IC that explains how the underlying network resources enhance the development and growth of ESVs. Utilizing a multiple case study approach, this paper suggests a dynamic process of resource allocation into heterogeneous IC that are optimally coordinated by the founders during an ESV’s development and growth through interaction with external networks. This approach in resource allocation complements the staged entrepreneurial finance and investment strategy for ESVs and their subsequent developments.     

A SIMULATION ANALYSIS OF HERDING AND UNIFRACTAL SCALING BEHAVIOUR

We model the financial market using a class of agent‐based models in which agents’ expectations are driven by heuristic forecasting rules (in contrast to the rational expectations models used in traditional theories of financial markets). We show that, within this framework, we can reproduce unifractal scaling with respect to three well‐known power laws relating (i) moments of the absolute price change to the time‐scale over which they are measured, (ii) magnitude of returns with respect to their probability and (iii) the autocorrelation of absolute returns with respect to lag. In contrast to previous studies, we systematically analyse all three power laws simultaneously using the same underlying model by making observations at different time‐scales and higher moments. We show that the first two scaling laws are remarkably robust to the time‐scale over which observations are made, irrespective of the model configuration. However, in contrast to previous studies, we show that herding may explain why long memory is observed at all frequencies. Copyright © 2013 John Wiley & Sons, Ltd.     

Nonlinearities in stochastic clocks: trades and volume as subordinators of electronic markets

This paper discusses the possibility of recovering normality of asset returns through a stochastic time change, where the appropriate economic time is determined through a simple parametric function of the cumulative number of trades and/or the cumulative volume. The existing literature argues that the re-centred cumulative number of trades could be used as the appropriate stochastic clock of the market under which asset returns are virtually Gaussian. Using tick-data for FTSE-100 futures, we show that normality is not always recovered by conditioning on the re-centred number of trades. However, it can be shown that simply extending the approach to a nonlinear function can provide a better stochastic clock of the market.     

GAAP,GFS and AASB 1049: perceptions of public sector stakeholders

Efforts by Australian standard‐setters to harmonise public sector financial reporting resulted in AASB 1049, which sought to bridge the divide between generally accepted accounting principles (GAAP)‐based and government finance statistics (GFS)‐based financial statements. However, whether AASB 1049 has resulted in information that is considered appropriate for the public sector has not been examined. We explore this issue by comparing the requirements of AASB 1049 with the responses from a survey of public sector stakeholders on the appropriate accounting treatment and presentation of selected financial items. The analysis suggests consensus with AASB 1049 on presentation issues but less consensus on accounting treatments.     

Outcome-based contracts as new business model: The role of partnership and value-driven relational assets

This paper investigates the new business model of outcome-based contracts where the firm is tasked to achieve outcomes of equipment as a service contract instead of the traditional maintenance, repair and overhaul activities (e.g., power-by-the-hour® engine service contract). Through a qualitative study of two outcome-based contracts between BAE Systems, MBDA and the UK Ministry of Defence, we derive three value drivers of information, material and people transformation. Mapping it with transaction cost literature we propose five relational assets based on the value drivers; three value-driven alignments and two partnership inputs. We then study the relationships between the relational assets and contract performance through a quantitative survey by applying the partial least square (PLS) method. Our study shows that behavioral and information alignments are important to achieve outcomes. However, material and equipment alignment (i.e., joint supply chain) does not have a significant effect on contract performance. In addition, perceived control and empowerment mediated the relationship between partnership inputs and value-driven alignments. Our study provides a more integrated view of how various theoretical management domains overlap in the understanding of business models, and contribute to the understanding of value drivers and partnership factors in achieving performance in outcome-based contracts.     

Bailing outsourcing

In a model of organizational choice, this paper shows that in face of an increasingly expected bailout from the government, outsourcing input production to an offshore location is more likely an optimal choice for a firm. Such a response is consistent with the three trends in the US manufacturing sector after the crisis: (a) employment keeps declining; (b) massive layoffs have not stopped; and (c) imported intermediate inputs have been gaining importance.