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Lawrence (Larry) Plummer, Ph.D. is an Associate Professor at Ivey in the Entrepreneurship group. He earned his Ph.D. in strategy and entrepreneurship at the University of Colorado at Boulder. Previously, Professor Plummer was an assistant professor of management and entrepreneurship at the University of Oklahoma's Price College of Business and an assistant professor at Clemson University's College of Business and Behavioral Science. In 2004, Professor Plummer was named a management research fellow of the Max Planck Institute of Economics in Jena, Germany. His prior experience includes two consulting practices founded with his wife as well as international consulting and management in the aerospace, environmental, and television/film sectors.
Plummer's research focuses on new venture creation, growth, and performance. Much of his current research focuses on the geography of entrepreneurship through the lens of spatial economics including economic geography, regional/urban economics, location theory, and spatial econometrics. Professor Plummer's research is most concerned with the location choices entrepreneurs make in starting their businesses and how spatial competition between firms drives the survival and performance of new ventures. His research appears in Academy of Management Journal, Journal of Business Venturing, Strategic Entrepreneurship Journal, Organizational Research Methods, Entrepreneurship Theory and Practice, Small Business Economics, Annals of Regional Science, and Production and Operations Management.
Plummer is a research fellow of the Institute for Military and Veteran Families at Syracuse University and teaches annually at the Entrepreneurship Bootcamp for Veterans with Disabilities (EBV) and EBV-Families programs at Florida State University and Syracuse University.
Teaching
Ivey Field Project / New Venture Project (MBA and HBA)
Abstract: Regions with spatial concentrations of businesses create conditions that spawn new firms, but also undercut new venture survival. Localized competition puts pressure on new firms to exit. Adding to this pressure to exit is regional path dependence, which limits the ability of firms to respond strategically to hostile local conditions. We investigate the extent to which the pressure to exit created by localized competition is moderated by three “path breaking” factors—new knowledge, industry diversity, and industry switching. We test and find broad support for our hypotheses using data from 355 metropolitan statistical areas in the United States spanning 2002 to 2010.
Abstract: Organizational sponsorship impacts new venture emergence and survival prospects by shaping the relationship between new ventures and their surrounding environment. While extant literature offers an explanation as to why heterogeneity in the effectiveness of sponsorship emerges based on the sponsor's characteristics, current theorizing largely overlooks how sponsorship interacts with local economic conditions. This study introduces insights from urban economics to extend organizational sponsorship theory by showing how different types of agglomeration economies affect the effectiveness of organizational sponsorship. We test our hypotheses with a comprehensive database that includes over 46,000 sponsored and non-sponsored firms in the years 1997–2007. Our results reveal organizational sponsorship delays new venture exit when urbanization levels are low, localization is low, and both urbanization and localization are high.
Abstract: After new ventures have exhausted the limited financial resources of founders, family, and friends, they often pursue initial external capital. To secure investment, entrepreneurs can signal about their venture's latent potential by aligning themselves with reliable third parties. Such affiliations affirm the new venture's legitimacy and provide substantive benefits in the form of mentoring, access to resources, and ongoing monitoring. However, early stage financing is an especially "noisy" signaling environment owing to the large number of startups seeking funding, many of which will not survive. The real value of third party affiliations in this context resides in their ability to unlock the potential of other more pedestrian signals, such as the entrepreneur's characteristics and actions that might otherwise go unnoticed. We borrow from the sensemaking literature to explain how third party affiliation signals disambiguate signals with multiple possible interpretations so that potential investors interpret them positively. Findings support our theory that a startup's characteristics and actions are signals that remain relatively unnoticed unless a startup combines them with a third party affiliation that enhances the signal's value, thus increasing the likelihood of receiving external capital.
Abstract: This study explores the effects of defense agency funding of university research on regional new venture creation. We argue that closed’ university research may constrain the direct flow of new knowledge into the entrepreneurial process, but does not restrict more tacit and indirect flows of university research. We find a negative (positive) effect of the defense share of university research funding on short-term (long-term) regional start-up rates. This may indicate that while defense-funded research may not seed start-ups directly, the knowledge carried into the private sector through more indirect channels may contribute, albeit slowly, to regional entrepreneurial activity.
Abstract: This study uses a service operations management (SOM) strategy lens to investigate chain store retailers' strategic design responsiveness (SDR)a term that captures the degree to which retailers dynamically coordinate investments in human and structural capital with the complexity of their service and product offerings. Labor force and physical capital are respectively used as proxies for investments in human capital and structural capital, whereas gross margins are proxies for productservice offering complexity. Consequently, SDR broadly reflects three salient complementary choices of SOM design strategy. We test the effects of brick and mortar chain store retailers' SDR on current and future firm performance using publically available panel data collected from Compustat and the University of Michigan American Customer Satisfaction Index databases for the period 19962011. We find that retailers that fail to keep pace with investments in both structural and human capital exhibit short-term financial benefits, but have worse ongoing operational performance. These findings corroborate the importance of managers strategically maintaining the complementarity of design-related choices for improving and maintaining business performance.
Abstract: In order to identify shifts and trends in the entrepreneurship literature over the past 25 years, we conduct a bibliometric study involving new data from the 20002009 era building on 19851999 data to study entrepreneurship research published in the major management journals. Our findings indicate that entrepreneurship articles now have a significant presence in the mainline A journals. Furthermore, we contend that this presence signals legitimacy and, more importantly, a growing exchange among researchers studying entrepreneurship. The area of entrepreneurial opportunities and nascent ventures is showing signs of growth and in our view represents an area where entrepreneurship is contributing back to the broader research conversation in organizational studies.
Abstract: The knowledge spillover theory of entrepreneurship predicts that the relationship between new knowledge and entrepreneurial activity depends on the commercialization efficiency of incumbents. We extend the theory to contend that localized competition impedes entrepreneurial activity by reducing the incentive to exploit new knowledge, and we test this conjecture using spatial panel estimation. We find a positive relationship between new knowledge and entrepreneurial activity, which is negatively moderated by localized competition. We also find that greater agglomeration counteracts the moderating effect localized competition has on the relationship between new knowledge and entrepreneurial activity.
Abstract: Measures used in entrepreneurship research are often subject to spatial dependence. Spatial dependence renders ordinary least squares (OLS) estimation inappropriate because the estimates will be biased, inconsistent, andor inefficient. The aims of this article are (a) to demonstrate how spatial dependence is especially problematic for entrepreneurship research and (b) to arm researchers with spatial modeling techniques that are more appropriate for such analysis. As such, not only will this article illustrate how to incorporate spatial dependence explicitly into the linear regression model, it also discusses how these techniques make it possible to explore and locate areas with particularly high levels of spatial dependence (i.e., hot spots). These techniques, although new to the management literature, are well known in both the regional science and geography literatures and are rapidly diffusing to economics, sociology, and related social sciences.
Abstract: A new model of economic growth introduces the knowledge filter between new knowledge and economically useful knowledge. It identifies both new ventures and incumbent firms as the mechanisms that penetrate the knowledge filter. Recent empirical work has shown that new firms are more proficient at penetrating the knowledge filter than are incumbent firms however, the analysis has only examined expanding economies and has relied on purely cross-sectional regression methodologies. This study explores the role of new and incumbent firms in penetrating the knowledge filter utilizing recent developments in spatial panel estimation techniques to provide a more robust set of findings. The results suggest those new firms are more proficient at penetrating the knowledge filter in declining and growing regions alike.
Abstract: This paper aims to highlight the opportunity to contribute to our understanding of strategic entrepreneurship by exploring the construct through the lens of agency theory. In particular, we claim a fundamental link between a new venture's control of critical resources and the distribution of equity between the principal and agent. According to agency theory, assigning top executives ownership in the firm provides arrangements that are compatible with the incentives of the owners of the firm. This paper suggests that agency theory has special relevance when considered in a strategic entrepreneurship context. This is because the function of managers in entrepreneurial new ventures is fundamentally different from their counterparts in large established, incumbent corporations. While both types of managers have to provide managerial and organizational expertise, managers in entrepreneurial new ventures have an additional function that is essential to the competitive advantage and performance of the new ventureproviding knowledge and human capital, which, in many cases, is intrinsically linked to the capital resources of the new venture. Our framework is tested using patent ownership as a proxy for both relationship-specific investments and indispensable human capital of the top manager of the new venture. The empirical results support the main hypotheses posited by the entrepreneurial governance model. In particular, patent ownership of the top manager significantly increases the percentage of equity held, while the number of patents held by the firm significantly decreases the percentage of ownership.
Abstract: In this article, we apply a process of logical inference to draw conclusions about the origins of entrepreneurial opportunity from existing conversations in the field of strategic management. We equate the execution of a competitive strategy as described in the strategic management literature to the exploitation of an entrepreneurial opportunity as described in the entrepreneurship literature. Given this assumption, we survey five extant theories of strategy in an attempt to categorize and describe the circumstances that define how and with what consequence entrepreneurial opportunity exploitation results in future opportunity. Given this review, we characterize the outcomes’ of strategy execution as a function of the match’ between strategy and environment in an effort to extend and refine Holcombe’s [Holcombe, Randall, 2003, Review of Austrian Economics 16(1), 2543 position that entrepreneurial opportunity is born of prior entrepreneurial action.
Abstract: The nature and source of entrepreneurial opportunity are important issues for understanding how markets function and come into being. In addition to describing the forum held on the topic and summarizing the contributions of the articles that appear in the special issue, this article shares a number of lessons learned during the workshop and the editorial process. We explore three of the most important reasons for confusion about the opportunity construct: (1) the objectivity of opportunity, (2) the perceived importance of one particular individual in determining the direction of the social world and (3) what distinguishes the sub-class of entrepreneurial opportunity from the broader category of opportunity in general. Finally, we offer some directions for future research by illuminating important issues that emerged from the workshop but that remain largely unanswered by the papers of this special issue.
Abstract: New knowledge in the form of products, processes and organizations leads to opportunities that can be exploited commercially. However, converting new ideas into economic growth requires turning new knowledge into economic knowledge that constitutes a commercial opportunity. A model introduces a knowledge filter'' between new knowledge and economic knowledge and identifies both new ventures and incumbent firms as the mechanism that reduces the knowledge filter and increases regional growth. This paper tests the hypotheses that new venture creation is a better mechanism than the absorptive capacity of incumbent firms for converting new knowledge into economic knowledge. Our results support the contention that new venture creation is a superior method of penetrating the regional knowledge filter'' than incumbent firms.
