Searching for the General Theory of the Firm

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Organization and Change > Forum > Searching for the General Theory of the Firm

Searching for the General Theory of the Firm
In Ho Kim, Professor, Korea (South), Member
Is it not possible to set up the general theory of the firm? The reason why I raise this question is that there are so many methods, models and theories in dealing with business management, both theoretically and practically. As we all know, a firm is a social institution to earn profit in a dynamical environment through value creation in which a firm should contribute positively to the society it belongs. If we recognize the profit-seeking formula in addition to the things mentioned above in terms of the indicators of expected revenue and cost, then we are able to set up the general theory that will be applicable to any firm in any industry at anytime. . (...) Read more? Sign up for free
 

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General Theory of the Firm?
Jaap de Jonge, Management Consultant, Netherlands
I'm afraid firms are quite complex social phenomena, so it may never be possible to capture them in a single theory or model.
Your definition of the (purpose) of the firm is far from universally agreed, there is considerable difference in what people people believe should be the purpose of firms. See shareholder value perspective, stakeholder value perspective, Porter's Shared Value and Mourkogianni's Moral Purpose for the most important views on this.
 

 
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Profit-seeker Rather Than Value Creator
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Profit is More Important than Creating Value
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