Operationalizing the resource based view for nascent and young firms : developing scales for resource advantages and disadvantages

Principal Topic: It is well known that most new ventures suffer from a significant lack of resources, which increases the risk of failure (Shepherd, Douglas and Shanley, 2000) and makes it difficult to attract stakeholders and financing for the venture (Bhide & Stevenson, 1999). The Resource-Based View (RBV) (Barney, 1991; Wernerfelt, 1984) is a dominant theoretical base increasingly drawn on within Strategic Management. While theoretical contributions applying RBV in the domain of entrepreneurship can arguably be traced back to Penrose (1959), there has been renewed attention recently (e.g. Alvarez & Busenitz, 2001; Alvarez & Barney, 2004). This said, empirical work is in its infancy. In part, this may be due to a lack of well developed measuring instruments for testing ideas derived from RBV. The purpose of this study is to develop a measurement scales that can serve to assist such empirical investigations. In so doing we will try to overcome three deficiencies in current empirical measures used for the application of RBV to the entrepreneurship arena. First, measures for resource characteristics and configurations associated with typical competitive advantages found in entrepreneurial firms need to be developed. These include such things as alertness and industry knowledge (Kirzner, 1973), flexibility (Ebben & Johnson, 2005), strong networks (Lee et al., 2001) and within knowledge intensive contexts, unique technical expertise (Wiklund and Shepard, 2003). Second, the RBV has the important limitations of being relatively static and modelled on large, established firms. In that context, traditional RBV focuses on competitive advantages. However, newly established firms often face disadvantages, especially those associated with the liabilities of newness (Aldrich & Auster, 1986). It is therefore important in entrepreneurial contexts to expand to an investigation of responses to competitive disadvantage through an RBV lens. Conversely, recent research has suggested that resource constraints actually have a positive effect on firm growth and performance under some circumstances (e.g., George, 2005; Katila & Shane, 2005; Mishina et al., 2004; Mosakowski, 2002; cf. also Baker & Nelson, 2005). Third, current empirical applications of RBV measured levels or amounts of particular resources available to a firm. They infer that these resources deliver firms competitive advantage by establishing a relationship between these resource levels and performance (e.g. via regression on profitability). However, there is the opportunity to directly measure the characteristics of resource configurations that deliver competitive advantage, such as Barney´s well known VRIO (Valuable, Rare, Inimitable and Organized) framework (Barney, 1997). Key Propositions and Methods: The aim of our study is to develop and test scales for measuring resource advantages (and disadvantages) and inimitability for entrepreneurial firms. The study proceeds in three stages. The first stage developed our initial scales based on earlier literature. Where possible, we adapt scales based on previous work. The first block of the scales related to the level of resource advantages and disadvantages. Respondents were asked the degree to which each resource category represented an advantage or disadvantage relative to other businesses in their industry on a 5 point response scale: Major Disadvantage, Slight Disadvantage, No Advantage or Disadvantage, Slight Advantage and Major Advantage. Items were developed as follows. Network capabilities (3 items) were adapted from (Madsen, Alsos, Borch, Ljunggren & Brastad, 2006). Knowledge resources marketing expertise / customer service (3 items) and technical expertise (3 items) were adapted from Wiklund and Shepard (2003). flexibility (2 items), costs (4 items) were adapted from JIBS B97. New scales were developed for industry knowledge / alertness (3 items) and product / service advantages. The second block asked the respondent to nominate the most important resource advantage (and disadvantage) of the firm. For the advantage, they were then asked four questions to determine how easy it would be for other firms to imitate and/or substitute this resource on a 5 point likert scale. For the disadvantage, they were asked corresponding questions related to overcoming this disadvantage. The second stage involved two pre-tests of the instrument to refine the scales. The first was an on-line convenience sample of 38 respondents. The second pre-test was a telephone interview with a random sample of 31 Nascent firms and 47 Young firms (< 3 years in operation) generated using a PSED method of randomly calling households (Gartner et al. 2004). Several items were dropped or reworded based on the pre-tests. The third stage (currently in progress) is part of Wave 1 of CAUSEE (Nascent Firms) and FEDP (Young Firms), a PSED type study being conducted in Australia. The scales will be tested and analysed with a random sample of approximately 700 Nascent and Young firms respectively. In addition, a judgement sample of approximately 100 high potential businesses in each category will be included. Findings and Implications: The paper will report the results of the main study (stage 3 – currently data collection is in progress) will allow comparison of the level of resource advantage / disadvantage across various sub-groups of the population. Of particular interest will be a comparison of the high potential firms with the random sample. Based on the smaller pre-tests (N=38 and N=78) the factor structure of the items confirmed the distinctiveness of the constructs. The reliabilities are within an acceptable range: Cronbach alpha ranged from 0.701 to 0.927. The study will provide an opportunity for researchers to better operationalize RBV theory in studies within the domain of entrepreneurship. This is a fundamental requirement for the ability to test hypotheses derived from RBV in systematic, large scale research studies.

Making sense of the resource-based view?

The Resource Based View (RBV) of strategic management has been criticized for relying on inconsistent assumptions of rationality, and mutually inconsistent underlying hypotheses. In this paper, I outline how these critiques can be addressed by re-building RBV on a sense-making foundation. The core notions from sense-making of bounded cognition, retrospective sense-making, incrementalism, loose coupling, causal maps and organizational paradigm are introduced. These are then used to propose a re-construction of key RBV constructs, extending some conceptual discussions, and providing for a conceptually consistent formulation. Implications for the use of RBV as a theory and future research are discussed.

In Pursuit of Excellence : A Policy Driven Systemic Initiative to Embed Gifted Education

Embedding gifted education practices requires major professional development strategies supported by transparent, credible and enforceable policy. This paper describes an analysis of a state-wide initiative involving the establishment of a series of schools tasked to develop and disseminate gifted education principles. The authors have been involved with this initiative at a number of levels over a ten-year period. Their involvement culminated in a commissioned review of the program. Extensive qualitative data were purposively collected from all stakeholders and the effectiveness of the initiative is examined from a theoretical framework of policy development and excellence. The findings summarised in this proposal, indicate the achievement of excellence at a systemic level was constrained by lack of vision, leadership and commitment to long term achievements of excellence. At a local level evidence exists that excellence can be manifested when there is synchronicity of vision, purpose, decisions, and actions.

The failure of Australian legislation on indirect discrimination to detect the systemic racism which prevents Aboriginal people from fully participating in the workforce

Government figures put the current indigenous unemployment rate at around 23%, 3 times the unemployment rate for other Australians. This thesis aims to assess whether Australian indirect discrimination legislation can provide a remedy for one of the causes of indigenous unemployment - the systemic discrimination which can result from the mere operation of established procedures of recruitment and hiring. The impact of those practices on indigenous people is examined in the context of an analysis of anti-discrimination legislation and cases from all Australian jurisdictions from the time of the passing of the Racial Discrimination Act by the Commonwealth in 1975 to the present. The thesis finds a number of reasons why the legislation fails to provide equality of opportunity for indigenous people seeking to enter the workforce. In nearly all jurisdictions it is obscurely drafted, used mainly by educated middle class white women, and provides remedies which tend to be compensatory damages rather than change to recruitment policy. White dominance of the legal process has produced legislative and judicial definitions of "race" and "Aboriginality" which focus on biology rather than cultural difference. In the commissions and tribunals complaints of racial discrimination are often rejected on the grounds of being "vexatious" or "frivolous", not reaching the required standard of proof, or not showing a causal connection between race and the conduct complained of. In all jurisdictions the cornerstone of liability is whether a particular employment term, condition or practice is reasonable. The thesis evaluates the approaches taken by appellate courts, including the High Court, and concludes that there is a trend towards an interpretation of reasonableness which favours employer arguments such as economic rationalism, the maintenance of good industrial relations, managerial prerogative to hire and fire, and the protection of majority rights. The thesis recommends that separate, clearly drafted legislation should be passed to address indigenous disadvantage and that indigenous people should be involved in all stages of the process.

View from a bridge : what makes a musical city

The attention paid by the British music press in 1976 to the release of The Saints first single “I’m Stranded” was the trigger for a commercial and academic interest in the Brisbane music scene which still has significant energy. In 2007, Brisbane was identifed by Billboard Magazine as a “hot spot” of independent music. A place to watch. Someone turned a torch on this town, had a quick look, moved on. But this town has always had music in it. Some of it made by me. So, I’m taking this connection of mine, and working it into a contextual historical analysis of the creative lives of Brisbane musicians. I will be interviewing a number of Brisbane musicians. These interviews have begun, and will continue to be be conducted in 2011/2012. I will ask questions and pursue memories that will encompass family, teenage years, siblings, the suburbs, the city, venues, television and radio; but then widen to welcome the river, the hills and mountains, foes and friends, beliefs and death. The wider research will be a contextual historical analysis of the creative lives of Brisbane musicians. It will explore the changing nature of their work practices over time and will consider the notion, among other factors, of ‘place’ in both their creative practice and their creative output. It will also examine how the presence of the practitioners and their work is seen to contribute to the cultural life of the city and the creative lives of its citizens into the future. This paper offers an analysis of this last notion: how does this city see its music-makers? In addition to the interviews, over 300 Brisbane musicians were surveyed in September 2009 as part of a QUT-initiated recorded music event (BIGJAM). Their responses will inform the production of this paper.

A summary view of government cost recovery policies in Australia and New Zealand relating to the supply of public sector information

Researching administrative history is problematical. A trail of authoritative documents is often hard to find; and useful summaries can be difficult to organise, especially if source material is in paper formats in geographically dispersed locations. In the absence of documents, the reasons for particular decisions and the rationale underpinning particular policies can be confounded as key personnel advance in their professions and retire. The rationale for past decisions may be lost for practical purposes; and if an organisation’s memory of events is diminished, its learning through experience is also diminished. Publishing this document tries to avoid unnecessary duplication of effort by other researchers that need to venture into how policies of charging for public sector information have been justified. The author compiled this work within a somewhat limited time period and the work does not pretend to be a complete or comprehensive analysis of the issues.----- A significant part of the role of government is to provide a framework of legally-enforceable rights and obligations that can support individuals and non-government organisations in their lawful activities. Accordingly, claims that governments should be more ‘business-like’ need careful scrutiny. A significant supply of goods and services occurs as non-market activity where neither benefits nor costs are quantified within conventional accounting systems or in terms of money. Where a government decides to provide information as a service; and information from land registries is archetypical, the transactions occur as a political decision made under a direct or a clearly delegated authority of a parliament with the requisite constitutional powers. This is not a market transaction and the language of the market confuses attempts to describe a number of aspects of how governments allocate resources.----- Cost recovery can be construed as an aspect of taxation that is a sole prerogative of a parliament. The issues are fundamental to political constitutions; but they become more complicated where states cede some taxing powers to a central government as part of a federal system. Nor should the absence of markets be construed necessarily as ‘market failure’ or even ‘government failure’. The absence is often attributable to particular technical, economic and political constraints that preclude the operation of markets. Arguably, greater care is needed in distinguishing between the polity and markets in raising revenues and allocating resources; and that needs to start by removing unhelpful references to ‘business’ in the context of government decision-making.

How boards strategise : a strategy as practice view

While board involvement in strategy is seen as increasingly important, our understanding of how boards fulfil this role is limited. This article draws on indepth qualitative research with directors and senior managers to develop a Strategy as Practice view on how boards "do" strategy. Two different but complementary strategising practices - Procedural Strategising and Interactive Strategising - are identified and elaborated in terms of their underlying micro-activities. The internal boardroom factors that affect the relative emphasis on these strategies practices - the strategic stance of the board, board power and perceive legitimacy of each practice - are also identified and discussed. These findings are then integrated into a typology of board strategising. A key implication of this paper is that boards need to consciously choose the nature and extent of their involvement in strategy.

The carrying capacity imperative : assessing regional carrying capacity methodologies for sustainable land-use planning

The global impact of an ever-increasing population-base combined with dangerously depleted natural resources highlights the urgent need for changes in human lifestyles and land-use patterns. To achieve more equitable and sustainable land use, it is imperative that populations live within the carrying capacity of their natural assets in a manner more accountable to and ethically responsible for the land which sustains them. Our society’s very survival may well depend on worldwide acceptance of the carrying capacity imperative as a principle of personal, political, economic, educational and planning responsibility. This theoretically-focused research identifies, examines and compares a range of methodological approaches to carrying capacity assessment and considers their relevance to future spatial planning. It also addresses existing gaps in current methodologies and suggests avenues for improvement. A set of eleven key criteria are employed to compare various existing carrying capacity assessment models. These criteria include whole-systems analysis, dynamic responses, levels of impact and risk, systemic constraints, applicability to future planning and the consideration of regional and local boundary delineation. This research finds that while some existing methodologies offer significant insights into the assessment of population carrying capacities, a comprehensive model is yet to be developed. However, it is suggested that by combining successful components from various authors, and collecting a range of interconnected data, a practical and workable systems-based model may be achievable in the future.

The soft skills of project management : a view from diploma graduates

A research study was conducted in a key area of project management: stakeholder and relationship management through communication - ‘the soft skills’. It was conducted with Diploma of Project Management graduates from one Australian Registered Training Organisation (RTO), the Australian College of Project Management (ACPM). The study was designed to initially identify the qualifications and project management experience of the participants. Further, it identified the respondents’ understanding of and attitude to commonly held principles and literature within the project management field as it relates to the soft skills of projects. This is specifically connected to their project experience and knowledge, approach to project communications, and the stakeholder’s needs. Some of the literature showed that through the management and application of the project soft skills by project managers may actually be a recipe for project success. Hence, an important underpinning of this study was that the project manager can enhance project success (or reduce the impact of failure) by identifying and prioritising stakeholders, developing and implementing strategies for engaging and communicating with them. The use of a positivist approach to this research study allowed for the evaluation and understanding of respondents to the emergent theories of successful projects being delivered through the management of stakeholders, communications, and relationships. Consequently, a quantitative approach to this study was undertaken. The participants were drawn from graduates who completed (graduated) from the ACPM with the Diploma of Project Management between January 2004 and December 2007 only. A list of graduates was collated from this period indicating that a total of 656 graduates have completed and graduated with the qualification. The data collection for this study was done in one phase only. The questionnaire was emailed individually by the researcher directly to the selected potential respondents. Subsequently, a total of 44 responses were received, providing an overall response rate of 43%. Two key factors emerged from the survey questionnaire. Firstly, the need for the soft skills to be incorporated in project management curriculum and education programs, and secondly, that successful projects are delivered through the management and application of the project soft skills. It is expected that the findings of this study be provided across various forums (such as vocational education and training, and project management conferences) and via project management bodies such as the Australian Institute of Project Management (AIPM) to inform learning and provide greater insight into the soft skills of project management. It is the contention of the researcher that this quantitative study of Diploma of Project Management graduates’ views and attitudes highlights the importance of project soft skills and its importance in the delivery of successful projects as well as being part of the competencies of a successful project manager. This study also revealed the value of project experience and knowledge as it pertains to the management and application of the project soft skills.