The author attempts to conduct an analysis of the theory of the firm, from the point of view of two separate fields: economics and management. Juxtaposing the results of both approaches, the author iden¬tifies the differences between them and explains their sources. The differences in the nature of the two theories – economic and managerial – are illustrated by Coase’s theory of transaction costs and Porter’s positioning theory. The author briefly discusses the evolution of the theory of the firm, emphasising the fragmentary character of economic theories and the holistic nature of the presented managerial theories. The paper is also concerned with the relationship between the two disciplines as regards the theory of the firm, e.g. the problems which arise when scholars from one of the disciplines borrow some ideas from the other without proper attention to fundamental differences in the goals and methodology of each field. The author points out the benefits of collaboration between the two disciplines, showing how economics has contributed to the development of the strategic management theory, opting for collabora¬tion instead of isolation of the two
The paper investigates the notion of value chain: a concept of strategic management which is more popular with scholars than with practitioners. The author explains why theorists wrongly interpret the value chain concept, considering it as one of the many instruments of strategic analysis, useful for the rationalisa-tion of costs. The present paper clarifies the concept as intended by its creator. Porter regarded it as a series f guidelines instructing managers how to identify and build a good competitive strategy, making it possible to achieve competitive advantage, briefly outlined in his former book on competitive strategy. This paper, moreover, discusses some possible applications of the value chain concept and its relation to other theories of business strategy.
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