ORGGROWTH

The Growth of New Entrepreneurial Ventures and the Internal Dynamics of Resources

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 Obiettivo del progetto (Objective)

'How can newly established organizations grow successfully? This question has captivated researchers in entrepreneurship and organization theory for decades. This literature has documented that such diverse issues as competition at founding, firm strategies, and the size and composition of the management team can predict organizational growth (e.g. Eisenhardt and Schoonhoven, 1990). Underlying these diverse results is the premise that gaining access to necessary resources and managing these resources successfully is critical to realize organizational growth, yet the dynamics of the resources within entrepreneurial ventures, once obtained, are still poorly understood. In this project, we focus specifically on physical, material resources, a type of resource that has received little empirical attention compared to other types, such as human or knowledge-based resources. Focusing on material resources, this study aims to contribute to organization theory and entrepreneurship research by answering the following research questions: First, how do we explain diversity and change in the resource portfolios of entrepreneurial ventures in terms of these firms’ founding conditions? Second, how does diversity and change in such resource portfolios affect new venture growth? In short, this study intends to focus both on the antecedents (i.e. founding conditions) and consequences (i.e. organizational growth) of resource dynamics within new start-ups. This study’s research questions will be tested with data on the U.K. airline industry, 1919-1975, where aircraft are considered to be the critical resources to start-up airlines. The dataset will include over 350 -typically small- airline companies that existed throughout this period and over 3,500 aircraft held by these airlines.'

Introduzione (Teaser)

An EU-funded project is studying organisation growth in terms of consumption of materials. The historical case study traces the growth dynamics of United Kingdom airlines over 56 years to establish general economic principles.

Descrizione progetto (Article)

How can organisations successfully grow? The best theories say the answer concerns access to resources; however, no one actually knows.

Hence, the EU-funded project 'The growth of new entrepreneurial ventures and the internal dynamics of resources' (ORGGROWTH) is working to find this out. The aim is to study business growth by examining the use of material resources, which indicate organisational performance. The three-year project focuses on the United Kingdom's airline industry (from 1919 to 1975), and will conclude in March 2015.

Work during the first two years mainly involved obtaining data separately about aircraft (the resources) and airlines (organisations). The data were coded to reveal: airline longevity, founding conditions, airline resource dynamics, growth rates and macroeconomic covariates. Coding was mostly completed by the end of 2011.

The project has analysed the coded data, and conducted a literature review. Such work has laid the foundation for future completion of research papers.

Additionally, the project organised a conference involving prominent experts in corporate demography. The gathering helped to spread awareness of the project and to foster ties with other researchers in the field.

The ORGGROWTH project will reveal the dynamics of resource usage via a historical case study of British airlines. The work establishes general principles of the demographic effects on business performance.