A Behavioural Model of Company Development
A series of case studies, 17 in all, of firms of different sizes in the British domestic furniture industry were constructed in order to investigate factors influencing their rates of growth. The central hypothesis was that the objectives of firms’ managements and how successfully or otherwise they process information and base decisions on it constitutes a major factor combining with external factors — principally market conditions — to determine the course of a company’s development.
The cases were based on an extended version of the Cyert and March behavioural theory of the firm  . In addition to the immediate purpose of the research, it was hoped to develop a diagnostic tool whereby the formulation of a company’s major strategic decisions, the interactions between them and the flows of information on which they are based at each stage are viewed as a complete system. This could be used to pinpoint areas where additional information would be desirable and/or to eliminate superfluous or unsuitable data collection. It was hoped that this kind of model would be especially useful to the managements of small companies, which continue to have an important role to play in European economies, and in the Birmingham region in particular.
Such managements often lack understanding of the qualitative nature of their company systems, which surely formal analysis can usefully provide in circumstances where precise methods of quantitative prediction would clearly not be feasible. Systems thinking must come before computerisation and systems measurement. The present paper concentrates upon this purpose of the model.
KeywordsLarge Firm Marketing Strategy Strategic Decision Company Development Sales Promotion
Unable to display preview. Download preview PDF.
- Robert D. Buzzel, Donald F. Cox and Rex V. Brown, Marketing Research and Information Systems: text and cases, McGraw Hill, 1969, Chapter 1.Google Scholar
- Richard M. Cyert and James G. March (with associates): A Behavioural Theory of the Firm, Englewood Cliffs, N.J.: Prentice-Hall, 1963.Google Scholar
- F. E. Emery and E.L. Trist, The Causal Texture of Organisational Environments, Human Relations, Vol. 18, 1965 (reprinted in reference 4).Google Scholar
- Especially those reprinted in the Systems Thinking volume of the Penguin Modern Management Readings series, edited F.E. Emery, London, Penguin Books, 1969.Google Scholar
- A. S. Mackintosh: The Development of Firms, Cambridge University Press, 1963, pp. 19–21 and 29–31. The author states that his conceptual scheme is largely derived from J. Tinbergen: On the Theory of Economic Policy, Amsterdam, North-Holland Press, 1952.Google Scholar
- M. P. Schutzenberger, A Tentative Classification of Goal-Seeking Behaviors, Journal of Mental Science, Vol. 100, 1954, (reprinted in reference 4).Google Scholar