The Firm as an Intelligent System

Domitilla Magni ()
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Domitilla Magni: Catholic University of the Sacred Heart, Department of Economics and Business Management Sciences

Chapter 1 in AI-Driven Business Models, 2026, pp 3-12 from Springer

Abstract: Abstract The conceptualization of the firm has always reflected prevailing assumptions about how information is processed, decisions are made, and coordination is achieved. Classical economic theories portrayed the firm primarily as an efficiency-enhancing mechanism designed to reduce transaction costs relative to market exchange (Coase, 1937; Williamson, 1985). In these accounts, information is imperfect but largely exogenous, and managerial decision-making is bounded yet fundamentally human-centered. Later theoretical developments shifted attention toward internal heterogeneity and learning. The resource-based view emphasized firm-specific assets that are valuable, rare, inimitable, and non-substitutable as the foundation of competitive advantage (Barney, 1991). Closely related perspectives on organizational capabilities highlighted the importance of routines, experience accumulation, and path dependence (Nelson & Winter, 1982). Organizational learning theories further advanced the idea that firms adapt over time by balancing exploration and exploitation under conditions of uncertainty (March, 1991). Despite their differences, these traditions share a common premise: intelligence resides primarily in human actors and in socially constructed routines. Information technologies are treated as supporting infrastructures rather than as constitutive elements of organizational cognition. Recent advances in data-intensive computational systems challenge this premise by redistributing cognitive tasks across humans and machines, thereby altering how firms perceive, interpret, and respond to their environments.

Date: 2026
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DOI: 10.1007/978-3-032-35262-0_1

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