| New firms need discretionary resources to survive, grow, and improve performance. On the other hand, recent research indicates that there may be diminishing benefits to higher levels of discretionary resources. In this dissertation, I build from contrasting theoretical viewpoints of managerial discretion to address gaps in our understanding of the context and processes by which slack resources impact organizational outcomes. Specifically, I ask: What environmental combinations necessitate greater slack resources for performance? If new organizations do not have available slack, how do they overcome resource constraints and environmental changes to survive? How do entrepreneurial behaviors mediate the relationship between slack and firm growth?;Using panel samples and multiple cohorts of over 1000 Swedish-based ventures analyzed between 1994 and 2006, this dissertation underscored the benefits and possible trade-offs between organizational resources and the resourceful actions of organizations. In the first study, I examine the moderating effect of environments on the slack-performance relationship. While prior theory would assign higher utility to slack where it provides buffering capacity or flexibility, my arguments and results indicate slack is most valuable in resource poor environments where firms must create their own opportunities. In the second study, I examine the extent to which organizational autonomy affects initial survival chances and adaptation to environmental jolts. I found evidence that that surviving independent organizations benefit from early competitive pressures and develop greater capabilities in the use of limited available resources to reduce mortality rates during an environmental jolt as compared to subsidiary organizations. In the third study, I investigate entrepreneurial management behaviors as mediators between slack resources and firm growth. The results indicate that while slack resources benefit firm growth, they are substitutes rather than complements to entrepreneurial management behaviors in dynamic environments. Taken together, these studies demonstrate that entrepreneurial outcomes are a complex function of environments, resources, and behaviors. |
