In 1937 Coase explored the ‘nature of the firm’ and concluded economists cannot explain why firms exist, why their boundaries are where they are, why their internal arrangements are as they are, or why their performance is so varied. Without a viable theory of the firm we educators have no sound basis for teaching managing them. Economists have not yet answered Coase’s questions and our discipline seems to ignore the implications. More precisely we have no theories of the firm that (...) can explain profit, yet surely our students are headed into managing profit-seeking? If we follow Knight’s intuition and introduce uncertainty we create great difficulties for those managing business schools, as Simon observed in his 1967 paper on designing them : 1–16, 1967). This essay explores the implications for business schools of seeing a firm as a local language that indicates what must be attended to and how that should be treated if value and profit is to be created. (shrink)