Renessaince of Population Ecology: An Explanation for Performance of a Firm and its Survival

Abstract:     
Strategic management’s eternal quest has been to understand and identify factors which enable a firm to achieve and maintain sustained competitive advantage in its business domain. In line with this objective, its contributing disciplines have used their dominant paradigms to find the answers to this puzzle. A dominant solution eludes this field as the approaches have been driven by necessities of their dominant paradigm and hence splintered and uni-dimensional.

The theoretical stream of population ecology burst to prominence in 1980’s to stake its claim as a dominant discipline which could explain the factors behind the successful performance of a firm. By looking at populations of firms over their life cycle, it attempted to explain why some firms are able to adapt and survive over time. Although it did not fare much better than other disciplines, yet it brought with it a totally fresh perspective by changing the unit of analysis from organizational processes to cohorts of organizations. Presently the puzzle continues to elude a satisfactory explanation. This paper is an attempt to find an answer.

To find an answer to this issue, one has to use an integrated approach. Change comes from varying impacts of factors situated in the environment and change associated with them. Therefore successful firms must need to show an ability to adapt and successfully negotiate such changes. Hence critical is the ability of a perspective to explain this adaptation scheme, if it intends to give a holistic explanation.

This conceptual paper uses the lens of population ecology and its concepts of variation, selection and retention to understand how firms can sustain their competitive advantage over time. It incorporates the social psychology view of explanation of organizational perception and resource based view’s positioning of dynamic capabilities to come to a holistic explanation of the performance of a firm. It posits that the ability of organizations to continuously develop and use its dynamic capabilities is what facilitates its sustained performance and hence its survival.

Number of Pages in PDF File: 22

Keywords: Firm performance, Sustained competitive advantage, conceptual bases, population ecology, dynamic capabilities

working papers series