Entering a Golden Age of Sustained Superiority: Entrepreneurial Creation or Discovery?

Andrew D. Henderson () and Melissa E. Graebner ()
Additional contact information
Andrew D. Henderson: Department of Management, McCombs School of Business, University of Texas at Austin, Austin, Texas 78712
Melissa E. Graebner: Department of Business Administration, Gies College of Business, University of Illinois, Champaign, Illinois 61820

Organization Science, 2020, vol. 31, issue 6, 1432-1451

Abstract: To better understand the origins of sustained superior firm performance, we consider processes of entrepreneurial creation and discovery. Discovering new opportunities requires speed and flexibility, and although many discoveries are easy to implement, this makes them easy to imitate. By comparison, creation is more complex, iterative, and cumulative, making these opportunities slower to implement yet harder to copy. In formal simulation modeling and analyses of the U.S. Compustat population from 1966 to 2015, we found a bimodal pattern of entry into golden eras of sustained superiority. One peak consisted of an initial spike as firms went public, and evidence suggests this was driven by entrepreneurial discovery. The other peak involved a long-term inverted U-shaped trajectory that reached its high point about 17 years later. Evidence suggests this was driven by entrepreneurial creation, which first enabled then later constrained durable superiority. Our results have implications for research on sustained superiority, entrepreneurial opportunities, and strategic renewal.

Keywords: sustained superiority; entrepreneurship; organizational evolution; resource-based theory; simulation modeling (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://doi.org/10.1287/orsc.2020.1357 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inm:ororsc:v:31:y:2020:i:6:p:1432-1451

Access Statistics for this article

More articles in Organization Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().