Embeddedness, values and entrepreneur decision-making: Evidence from the creative industries

Abstract

This paper explores embeddedness in small firms from a foundational perspective and how these foundations effect resource dependency and business decision-making. Building on debates in firms embeddedness and its role in addressing questions of resource-limitation, the paper positions embeddedness as outcome of a value-set occurring within an organisation directly affecting resource decisions. Using case studies of six creative industries small and micro firms, it argues foundational embeddedness influences firm-based practices and relationships over conventional business logics. Certain flexibilities in this foundational embeddedness can be seen, responding to external challenges through formation of esoteric relations and iterative systems. The extent of this flexibility is however limited by the entrepreneurs’ willingness to compromise individual values. Foundational embeddedness is thus a necessary consideration in understanding entrepreneurial decision-making.