ADMS 1000 Lecture Notes - Lecture 6: Dominant Design, Public Knowledge, Market Power

• School: York University
• Department: Administrative Studies
• Course: ADMS 1000
• Professor: Alan Shapiro

Document Summary

The wide spread diffusion of an industry standard or dominant design is a critical step in facilitating an industry"s transition to the growth phase. The quest for legitimacy o new industries seek legitimacy (sociopolitical and cognitive) through collective action and institutional entrepreneurship a. sociopolitical legitimacy. Refers to the endorsement of an industry, activity ir organizational form of key stakeholders. It is much easier to get the resources to open it up and legitimacy is not an issue in this industry. In the text messaging case the entrepreneur launching it would need to explain to the stakeholders every detail of the company they also need to convince these stakeholders the potential of the business. A light bulb: de facto standard= virtue of common usage and is not officially sanctioned by any authority ex. Standardization of products and processes leads to economies of scale and less innovation as firms focus on sales and marketing to capture market share.