Building on the theory of the growth of the firm to develop an attitude and time based view of the firm

Lahy, Andrew (2020) Building on the theory of the growth of the firm to develop an attitude and time based view of the firm. Doctoral thesis, University of Buckingham.

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Abstract

We do not have today a commonly accepted theory that explains how and why firms behave as they do. This research seeks to address this gap and improve theoretical understanding of firm level behaviour and performance. This research considers different theoretical perspectives and argues that the strategic perspective is the most appropriate level to investigate firm-level behaviour. At this strategic level, this research challenges the widely used resource-based view and instead calls for a return to the theory of the growth of the firm. Contrary to most contemporary research, this research argues that the theory of the growth of the firm is distinct from, and superior to, the widely used resource-based view. Despite arguing for a return to the theory of the growth of the firm, this research identifies and seeks to address important gaps in the theory. It does so by developing a new conceptual framework, defined as the Attitude and Time Based View (ATBV) of the firm. The new framework is underpinned by the theory of the growth of the firm and complemented by ideas from the theory of planned behaviour. In line with these theories, the ATBV framework proposes that the most important resource available to firms is management time, and that management attitudes determine how management time is used by firms. This research tests the ATBV framework using a two-year longitudinal case study methodology with a large logistics service provider (LSP) firm that seeks to carry out a planned strategic change to develop a new Product Service System (PSS) business model. The data collected are analysed using a newly developed DISC (Direction, Importance, Strength and Consistency) score of management attitudes. The findings from the analysis demonstrate how management attitudes evolved, how the change in attitudes impacted the allocation of management time and how the change in management time allocation impacted the performance of the firm. An assessment of the research methodology reveals several limitations. In particular, the potential for research bias is highlighted due to the researcher performing the dual role of researcher and employee. The mitigating actions taken to minimise the limitations are provided. The research concludes that the theory of the growth of the firm and its focus on management time does provide useful insight into firm-level behaviour and performance. The conclusions from this research are found to link closely with the concept of ambidextrous firms and how firms seek to find the right balance between exploring and exploiting productive opportunities. This research has theoretical and practical implications. From a theoretical perspective, the research provides a new conceptual framework and methodology to investigate firm-level behaviour and performance. From a practical perspective, the research encourages managers to reflect on their own attitudes and the attitudes of those around them and also encourages managers and firms to consider how they use their time, and how this ultimately affects the behaviour and performance of the firm.

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