ABSTRACT
This chapter explains how firms create and maintain stability meaning how they create their ecosystems. The internal structure of the firm and that of the ecosystem can be represented as a radial pattern and used to explain behaviour. Interdependent firms whose fortunes become integrated, lock together and co-evolve from that point onwards. The firm is viewed in ‘long run’ perspective to understand its lifecycle. The resultant polarisation and stagnation are because of competition and not in spite of it. This is used to represent the competitive behaviour of the firm over time. Firms maximise and stabilise profits and grow to dominate particular industries and grow out of these to others in intentional search of stabilisation opportunities at the least possible cost.
