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Joining the pack or going solo? A dynamic theory of new firm positioning

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  • Boone, Christophe
  • Wezel, Filippo Carlo
  • van Witteloostuijn, Arjen

Abstract

The question of new firm positioning in the marketplace and entrant's subsequent long-term performance lies at the heart of strategic entrepreneurship. We suggest a dynamic theory of new firm positioning that hinges on an important feature of the competitive environment: industry-level product diversity. The key argument is that industry-level product diversity drives imitation or differentiation at entry, which in turn shapes the exit likelihood of new entrants. So, in our theory, the extent of the new entrant's product portfolio overlap with all the industry's incumbents takes center stage. Support for our logic is obtained from the analysis of the life histories of 640 British motorcycle producers during the period 1899–1993.

Suggested Citation

  • Boone, Christophe & Wezel, Filippo Carlo & van Witteloostuijn, Arjen, 2013. "Joining the pack or going solo? A dynamic theory of new firm positioning," Journal of Business Venturing, Elsevier, vol. 28(4), pages 511-527.
    • Handle: RePEc:eee:jbvent:v:28:y:2013:i:4:p:511-527
    DOI: 10.1016/j.jbusvent.2012.07.006
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    3. Galina Shirokova & Liudmila Ivvonen & Elena Gafforova, 2019. "Strategic Entrepreneurship in Russia during Economic Crisis," Foresight and STI Governance (Foresight-Russia till No. 3/2015), National Research University Higher School of Economics, vol. 13(3), pages 62-76.
    4. Kromidha, Endrit & Li, Matthew C., 2019. "Determinants of leadership in online social trading: A signaling theory perspective," Journal of Business Research, Elsevier, vol. 97(C), pages 184-197.
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    7. Ad van den Oord & Arjen van Witteloostuijn, 2017. "The Population Ecology of Technology: An Empirical Study of US Biotechnology Patents from 1976 to 2003," PLOS ONE, Public Library of Science, vol. 12(1), pages 1-26, January.
    8. Edward Bishop Smith & Heewon Chae, 2017. "The Effect of Organizational Atypicality on Reference Group Selection and Performance Evaluation," Organization Science, INFORMS, vol. 28(6), pages 1134-1149, December.
    9. R. Duane Ireland & Michael C. Withers & Joseph S. Harrison & David S. Boss & Richard Scoresby, 2023. "Strategic Entrepreneurship: A Review and Research Agenda," Entrepreneurship Theory and Practice, , vol. 47(2), pages 495-523, March.
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    11. B. Westbrock & K.S. Muehlfeld & Utz Weitzel, 2017. "Selecting Legal Advisor in M&A’s: Organizational Learning and the Role of Multiplicity of Mental Models," Working Papers 17-19, Utrecht School of Economics.
    12. Shirokova, G. & Ivvonen, L., 2016. "Performance of Russian SMEs during the economic crisis: The role of strategic entrepreneurship," Working Papers 6454, Graduate School of Management, St. Petersburg State University.

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