The Twenty-First-Century Firm

The Twenty-First-Century Firm: Changing Economic Organization in International Perspective

Edited by Paul DiMaggio
Copyright Date: 2001
Pages: 288
https://www.jstor.org/stable/j.ctt7rrcq
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  • Book Info
    The Twenty-First-Century Firm
    Book Description:

    Students of management are nearly unanimous (as are managers themselves) in believing that the contemporary business corporation is in a period of dizzying change. This book represents the first time that leading experts in sociology, law, economics, and management studies have been assembled in one volume to explain the varying ways in which contemporary businesses are transforming themselves to respond to globalization, new technologies, workforce transformation, and legal change. Together their essays, whose focal point is an emerging network form of organization, bring order to the chaotic tumble of diagnoses, labels, and descriptions used to make sense of this changing world.

    Following an introduction by the editor, the first three chapters--by Walter Powell, David Stark, and Eleanor Westney--report systematically on change in corporate structure, strategy, and governance in the United States and Western Europe, East Asia, and the former socialist world. They separate fact from fiction and established trend from extravagant extrapolation. This is followed by commentary on them: Reinier Kraakman affirms the durability of the corporate form; David Bryce and Jitendra Singh assess organizational change from an evolutionary perspective; Robert Gibbons considers the logic of relational contracting in firms; and Charles Tilly probes the deeper historical context in which firms operate. The result is a revealing portrait of the challenges that managers face at the dawn of the twenty-first century and of how the diverse responses to those challenges are changing the nature of business enterprise throughout the world.

    eISBN: 978-1-4008-2830-2
    Subjects: Management & Organizational Behavior, Economics

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-2)
  3. CHAPTER 1 Introduction: Making Sense of the Contemporary Firm and Prefiguring Its Future
    (pp. 3-30)
    Paul DiMaggio

    A glance at the covers of contemporary business periodicals reveals that many people believe the corporation is changing so dramatically that we need a new lexicon to describe it. On a recent trip to my local book superstore, I found eleven titles that sought the right word to characterize the company of the future in a time of dizzying change. Some of these—The Boundaryless Organization(Ashkenas et al. 1998),The Centerless Organization(Pasternack and Viscio 1998),The Clickable Corporation(Rosenoer et al. 1999)—seized upon the greater permeability of organizational borders as the central image. Several others—The Collaborative...

  4. Part One: Portraits From Three Regions
    • CHAPTER 2 The Capitalist Firm in the Twenty-First Century: EMERGING PATTERNS IN WESTERN ENTERPRISE
      (pp. 33-68)
      Walter W. Powell

      The past decade was a confusing period for citizens, policymakers, and pundits alike. The pace of economic and technological change appears relentless, but the direction is unfamiliar. Joseph Schumpeter (1934) was one of the first analysts to observe that innovation brings with it the winds of creative destruction, but few were prepared for the gales of the 1990s. Consider just a few of the discordant trends in the U.S. and global economy.

      Alongside the tremendous upsurge of startup companies, created in the United States and abroad as well, we see the creation of global giants in a number of key...

    • CHAPTER 3 Ambiguous Assets for Uncertain Environments: HETERARCHY IN POSTSOCIALIST FIRMS
      (pp. 69-104)
      David Stark

      I have a tin can on my desk that I bought in Budapest in the autumn of 1989. It is considerably smaller than a standard tuna can and extremely light in weight. If you tap your fingernail on it, it gives a hollow ring. But the label, complete with a universal bar code, announces in bold letters that, in fact, it is not empty: “Kommunizmus Utolsó Lehelete”—“The Last Breath of Communism.”

      If I were so inclined, I could take my tin can as a facile metaphor for the transition in Eastern Europe. The last breath of communism marketed by...

    • CHAPTER 4 Japanese Enterprise Faces the Twenty-First Century
      (pp. 105-144)
      D. Eleanor Westney

      If this chapter had been written in 1990, the temptation to portray the Japanese industrial enterprise as the firm of the twenty-first century would have been overwhelming. Management consultants, the popular press, and even a number of organizational sociologists looked at the Japanese manufacturing firm and saw the lean, flat, flexible, high-commitment, networked firm of the future. Japan’s distinctive model had been further legitimated by its successful weathering of a series of external shocks (the two oil crises of the 1970s, the dramatic increase in the value of the yen in the mid-1980s, growing import restrictions in its major markets)...

  5. Part Two: Commentaries
    • CHAPTER 5 The Durability of the Corporate Form
      (pp. 147-160)
      Reinier Kraakman

      The company, the corporation, the enterprise—the firm by any name structures modern market societies almost as pervasively as the family or the nation-state. It is therefore important news that the firm is evolving in novel ways on the margins of these societies, as two of the principal contributors to this volume suggest. In his provocative essay on the firm in the twenty-first century, Walter Powell argues that hierarchical firms in the knowledge-based industries (at least) are dissolving into fluid “network[s] of treaties,” networks in which project-based collaborations and joint ventures diffuse firm boundaries and may even supplant them entirely....

    • CHAPTER 6 The Future of the Firm from an Evolutionary Perspective
      (pp. 161-185)
      David J. Bryce and Jitendra V. Singh

      The purpose of our essay is to provide a commentary, from an evolutionary point of view, on the provocative and interesting chapters authored by Walter Powell, David Stark and Eleanor Westney that appear earlier in this volume. We believe that the central issues addressed by all three chapters can benefit significantly from the exploration of their points of contact with an evolutionary perspective on organizations. Such an approach can help push the themes raised by the three chapters to conclusions that may not otherwise be evident.

      It is useful to begin with the broad features of our approach. We begin...

    • CHAPTER 7 Firms (and Other Relationships)
      (pp. 186-199)
      Robert Gibbons

      By now, many noneconomists know the two key events in the birth and revitalization of the economic theory of the firm. First, in 1937, Ronald Coase argued that firms will exist only in environments in which firms perform better than markets could. To create space for firms, Coase suggested that some environments might be plagued by “transaction costs” that cause markets to perform poorly. Second, in 1975, Oliver Williamson significantly deepened the discussions of why markets might perform poorly and why firms might perform better than markets. Roughly, Williamson argued that markets rely on formal contracts (i.e., those enforceable by...

    • CHAPTER 8 Welcome to the Seventeenth Century
      (pp. 200-209)
      Charles Tilly

      Welcome to the seventeenth century! As you enter the twenty-first century, in some respects you will be moving back in time. Back, in fact, two or three centuries. Throughout most of the world over most of human history, including the seventeenth century, people have undertaken risky long-term enterprises chiefly by relying on what we might call networks of trust. Under various names such as trade diasporas, lineages, and sects, such networks combine strong ties, considerable extent, many triads, and significant barriers to entry or exit.

      Risk is threat multiplied by uncertainty. People frequently confront short-term risk without creating elaborate social...

    • CHAPTER 9 Conclusion: The Futures of Business Organization and Paradoxes of Change
      (pp. 210-244)
      Paul DiMaggio

      The chapters in this volume have taken us from Silicon Valley to Budapest, and from Budapest to Tokyo; from the advanced-technology companies of the new millenium to the kinship-based enterprises of the seventeenth century; and from the frameworks of institutional sociology and network analysis to the variform precincts of economics, history, and evolutionary theory. Observing different worlds through different lenses, the authors have not surprisingly reached somewhat different conclusions. At the same time, there are substantial areas of agreement. My purpose in this chapter is to identify points of consensus and divergence and, above all, to articulate the questions that...

  6. References
    (pp. 245-270)
  7. Index
    (pp. 271-275)