External Interfaces or Internal Processes? Market Positioning and Divergent Professionalization Paths in Young Ventures

Alicia DeSantola (), Ranjay Gulati () and Pavel I. Zhelyazkov ()
Additional contact information
Alicia DeSantola: Foster School of Business, University of Washington, Seattle, Washington 98195
Ranjay Gulati: Harvard Business School, Boston, Massachusetts 02163
Pavel I. Zhelyazkov: The Hong Kong University of Science and Technology, Clear Water Bay, Kowloon, Hong Kong

Organization Science, 2023, vol. 34, issue 1, 1-23

Abstract: We explore how the initial market positioning of entrepreneurial ventures shapes how they professionalize over time, focusing specifically on the development of functional roles. In contrast to existing literature, which presumes a uniform march toward professionalization as ventures scale and complete developmental milestones, we advance a contingent perspective, distinguishing between the development of external interface functions (marketing & sales and customer development) and internal process functions (accounting, human resources, and finance). Specifically, we argue that positioning in an unconventional market space raises demand for external engagement that focuses ventures’ attention and resources toward developing external interface roles. At the same time, such unconventional ventures are less apt to elaborate their internal process roles relative to more conventional peers. We test these predictions using a novel longitudinal data set on the internal organizations of 3,748 U.S.-based entrepreneurial ventures. In contrast to common assumptions of convergent professionalization, our theory and findings advance the perspective that ventures pursue divergent professionalization paths based on their initial market positioning as they scale up.

Keywords: entrepreneurship; organizational structure; organizational evolution and change; new venture professionalization; scaling up; organizational design; entrepreneurial strategy (search for similar items in EconPapers)
Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
http://dx.doi.org/10.1287/orsc.2021.1561 (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:34:y:2023:i:1:p:1-23

Access Statistics for this article

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