Knowledge that Transforms

This case describes Anne Evans’ search for a market opportunity in the biotechnology industry, and examines the feasibility of establishing a new venture to exploit this opportunity. The drug development process in the biopharmaceutical industry spans three critical phases: pharmaceutical discovery, pharmaceutical development, and product marketing. The drug development process is a very capital–intensive process with expenditures averaging $800 million per drug and with very high failure rates—only one out of 5,000 compounds that emerge from discovery and preclinical testing will make it into the market. The drug development process therefore contributes to very high cash burn rates and corporate failures in the biotechnology industry.

Initial public offerings (IPOs) have been a prominent focus of academic and popular press attention, especially in recent years. Much of this attention can be attributed to the increase in IPO activity as a function of the “dot com” phenomenon. Of particular interest to both academics and practitioners is IPO underpricing. Review of existing research suggests little consensus regarding those factors associated with underpricing. We provide a meta-analysis of published studies. Our findings reveal a number of significant relationships, many of which are opposite that predicted by signaling theory. Implications of these findings for practice and future research are discussed.

While effective HR services and programs can help firms gain competitive advantage, small and medium enterprises (SMEs) often lack the internal resources required to develop and deliver these services and programs. As a result, SMEs increasingly are outsourcing HR activities to professional employer organizations (PEOs). Questions remain, however, about the conditions under which SMEs will benefit from outsourcing HR to a PEO, as well as about the type of benefits that are potentially available. The very nature of many HR activities raises questions about the risks associated with market governance and a PEO's ability to ensure service quality for SMEs. In order for these questions to be addressed, it is necessary to understand the process by which PEO utilization affects SME outcomes. In this article, we use transaction cost economics, social exchange theory, and the strategic HR literature to develop a framework for understanding the factors and conditions likely to affect whether and how an SME will benefit from using a PEO.

In this commentary, the received definitions of kin–based business are expanded in a way that allows application of the concept to a wider variety of cultures. Three types of kin–based enterprise are discussed: blood and marriage, spiritual, and community–based enterprises.

The SMEs‘ limited capacity to acquire information and use sources is a major factor explaining their low level of involvement and performance on export markets. Nonetheless, a small amount of applied research has been undertaken on this subject. We present the results of an inquiry into the impact of information search and competencies on the competitive strategy and export performance of 346 exporting manufacturing SMEs. The research model postulates that the performance of these SMEs is determined by their general competitive strategy, which in turn is explained by the ability of the business to acquire and manage foreign market information. The results of an analysis using a PLS method confirm three of the four hypotheses.

Initial public offerings (IPOs) have been a prominent focus of academic and popular press attention, especially in recent years. Much of this attention can be attributed to the increase in IPO activity as a function of the “dot com” phenomenon. Of particular interest to both academics and practitioners is IPO underpricing. Review of existing research suggests little consensus regarding those factors associated with underpricing. We provide a meta–analysis of published studies. Our findings reveal a number of significant relationships, many of which are opposite that predicted by signaling theory. Implications of these findings for practice and future research are discussed.

The SMEs’ limited capacity to acquire information and use sources is a major factor explaining their low level of involvement and performance on export markets. Nonetheless, a small amount of applied research has been undertaken on this subject. We present the results of an inquiry into the impact of information search and competencies on the competitive strategy and export performance of 346 exporting manufacturing SMEs. The research model postulates that the performance of these SMEs is determined by their general competitive strategy, which in turn is explained by the ability of the business to acquire and manage foreign market information. The results of an analysis using a PLS method confirm three of the four hypotheses.

In this article, we combine perspectives from labor economics and entrepreneurship to examine early retirees’ decision to become self–employed. Many individuals leave career employment before the traditional age of 65 and return to the labor market for a period of time before they fully retire. This phenomenon is referred to in the labor economics literature as bridge employment. Initial research of bridge employment has identified entrepreneurial activities to be common. The authors argue that first early retirees have to make the decision whether to permanently retire or to continue their labor force participation. If they decide to return to work, then self–employment is one option. Using the theoretical foundations of entrepreneurship, the authors outline the factors that would influence the self–employment choice and the types of entrepreneurial paths emanating from that choice.