By Shon R. Hiatt, W. Chad Carlos
Wiley Strategic Management Journal
2018
Although scholarship has demonstrated that market categories offer important signals to entrepreneurs about which goods and services are valued, little research has considered how entrepreneurs make sense of and exploit opportunities when contestation over category meaning persists. Using the emergent U.S. biodiesel market as a context, we present a framework to explain how the salience of different stakeholder frames shapes entrepreneurs’ perceptions of market opportunities and influences their market-entry strategies. By showing how framing contests affect entrepreneurial outcomes, this study illuminates the underlying cognitive mechanisms that impact market meaning and offers important implications for the literatures on entrepreneurship, market-category evolution, framing contests, and grand challenges.
By Brandon H. Lee, Shon R. Hiatt, Michael Lounsburyc
The Institute for Operations Research and the Management Sciences
2017
Although existing research has demonstrated the importance of attaining legitimacy for new market categories, few scholars have considered the trade-offs associated with such actions. Using the U.S. organic food product category as a context, we explore how one standards-based certification organization—the California Certified Organic Farmers (CCOF)—sought to balance efforts to legitimate a nascent market category with retaining a shared, distinctive identity among its members. Our findings suggest that legitimacy-seeking behaviors undertaken by the standards organization diluted the initial collective identity and founding ethos of its membership. However, by shifting the meaning of “organic” from the producer to the product, CCOF was able to strengthen the categorical boundary, thereby enhancing its legitimacy. By showing how the organization managed the associated trade-offs, this study highlights the double-edged nature of legitimacy and offers important implications for the literatures on legitimacy and new market category formation.
By Shon R. Hiatt, Jake B. Grandy, Brandon H. Lee
The Institute for Operations Research and the Management Sciences
2015
We explore how activists’ public and private politics elicit different organizational responses. Using data on U.S. petroleum companies from 1982 to 2010, we investigate how climate change activists serving as witnesses at congressional hearings and engaging in firm protests influenced firms’ internal and external responses. We find that public politics induced internally focused practice adoption, whereas private politics induced externally focused framing activities.We also find that private and public politics had an interaction effect: as firms faced more private political pressure, they were less likely to respond to public political pressures; similarly, as firms faced greater public political pressure, they were less likely to respond to private political pressures. The results suggest that activists can have a significant impact on firm behavior depending on the mix of private and public political tactics they engage in. We discuss the implications of our study for social movement research, organization theory, and nonmarket strategy.
