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Now working once again on my Knight-based ‘theory of the firm’, with some major new insights. Most pleasing, a shift from ‘the firm’ as a theory to be implemented to ‘the firm’ as a practice – a work of art like a ballet or a symphony. Helps show ‘management’ as an art-form – of peculiarly high significance, of course.
Academic Activities. I came into management education in 1971 after Naval service and managerial work in several industries. I wanted to understand this experience. It proved more difficult – and more interesting – than I imagined. Ever since I have been working on a theory of the firm that hinges on the managerial/entrepreneurial imagination. I have only recently understood how we might proceed by making Knightian uncertainty central, questioning why firms exist and what they are. The move brings strategy, entrepreneurship, ethics, and leadership together into a single inquiry. The most crucial elements are (a) non-zero transaction costs, and hence (b) the processes that create economic value at least sufficient to cover these costs. Regrettably, Williamson’s analysis obscures rather than clarifies.