The Competitive Dynamics of Entrepreneurial Market Entry

The Competitive Dynamics of Entrepreneurial Market Entry

The Johns Hopkins University series on Entrepreneurship

Edited by Gideon D. Markman and Phillip H. Phan

Research on general market entry usually focuses on large enterprises. Often, however, small entrants can alter the competitive dynamics of an industry. This volume brings together the most prominent thought leaders and the best research on the asymmetric entrant-incumbent dynamics. The ideas presented offer a more nuanced perspective on how, when, where and with what consequences small, single-product firms enter markets that are dominated by large, multiproduct and multimarket incumbents.

Chapter 1: A Retrospective and Prospective Examination of Competitor Analysis and Interfirm Rivalry with Implications for Entrepreneurship and Market Entry

Ming-Jer Chen

Subjects: business and management, entrepreneurship, economics and finance, industrial economics

Extract

* Ming-Jer Chen The evolution of Chen (1996), like many entrepreneurial activities, was tumultuous. The core ideas of the paper were roundly criticized at an elite workshop organized by a premier business school in the fall of 1989 (Chen, 2010). From this humble and rough beginning, the paper went on to first-round acceptance in the Academy of Management Review (AMR) in 1995 and the journal’s Best Paper recognition in 1997 (and the Glueck Best Paper Award). The journey of this paper in many ways mirrors the entry and eventual emergence of competitive dynamics research in the strategy field over the past two decades. In fact, I did not use the term “competitive dynamics” in the paper (nor in any of my ten prior publications in leading journals), but rather “inter-firm rivalry.” To economists, “dynamics” involved temporal consideration rather than the interactive nature of competition that I intended to explore. Instead of challenging the prevailing economics view, I had been interchangeably using such terms as “competitive interaction” and “inter-firm rivalry.” This situation changed completely when all 17 external evaluators of my promotion at Columbia (1995–96) chose to use the term “competitive dynamics” to refer to my body of work (in my dossier I had used “microcompetitive behavior” to describe my research). The acceptance and recognition of competitive dynamics as a legitimate research domain that was homegrown in the strategy field was perhaps indicative of the field’s intellectual maturity and ability to stand independent of its mother disciplines (Hambrick & Chen, 2008). The...

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