Managerial Tenure and Recovery Following M-Form Reorganization in Diversified Firms

We identify two factors that affect how quickly highly interdependent diversified firms recover from the performance disruptions that typically accompany M-form reorganizations: (1) organizational tenure and (2) the tenure of top management teams. We find that top management teams with a rare combination of long organizational tenure and relatively short team tenure are associated with faster performance recovery in diversified firms with extensive business unit interdependencies. The effects of managerial tenure on recovery time were found to be inconsequential in unrelated diversified firms where the reorganization task is less complex.     

Age,order of entry,strategic orientation,and organizational performance

This paper proposes an empirical test of several hypotheses linking age, order of entry, and strategic orientations to a firm's performance. Three strategies are defined: cost-leadership strategy, innovative differentiation, and marketing differentiation. The aim is to show that the impact on performance of both age and each of the three strategic orientations may differ according to a firm's order of entry into an industry.Following Lieberman and Montgomery's (1998) evaluation of their major contribution on first mover advantage, we emphasize three points. First, we develop and test hypotheses related to early and late followers' strategic orientations, broadening the scope of traditional studies on pioneers. Second, the model combines the dimensions of a firm's age, order of entry, and strategic orientations, as well as industry conditions (stage of the industry, environmental unpredictability, and technology diffusion), to establish a contingent model of performance analysis. Finally, the empirical study deals chiefly with organizational performance and not market share, which is considered a typical advantage accruing to pioneers.In addition, the scope of the study (582 French manufacturing firms) provides the means to fill a void in empirical studies because it is a broad cross-sectional test on non-U.S. data. The firms are mainly private, small to medium-sized, and single or dominant business firms. Therefore, our assumptions must be understood as particularly applicable to this type of firm.The results reveal important lessons for practitioners. First, we did not find a first-mover advantage in terms of organizational performance. In addition, pioneers' organizational performance is enhanced by the cost leader strategy—contrary to our assumption emphasizing innovative differentiation for these firms. Second, early followers' performance benefits from innovative differentiation and marketing differentiation. Finally, late entrants developing a cost leader strategy have a significantly higher performance. All groups considered, late followers are the firms most sensitive to environmental uncertainty and age effects.Our study clarifies the impact of a firm's age and strategic orientations on its performance depending on the firm's order of entry. The implications of these results are particularly relevant for practitioners and entrepreneurs. First, a cost leadership strategy seems to be a guarantee for a pioneer to increase its organizational performance. New ventures should therefore take into consideration the fact that newness and innovative differentiation might not be the best strategic orientations for high performance in the long run. Second, as a second mover, however, developing a superior product and being able to market it efficiently appear to be the enhancing factors of firm performance. Third, for both pioneers and early followers, age does not significantly reduce their performance. However, the longer a firm waits before entering, the greater is the negative effect of age on its performance. This is due to the difficulty of resisting competitive erosion, because pioneers and early followers drive the changes in the industry. The identification of these effects should help managers and stakeholders to make more effective entry decisions to sustain a firm's advantage, leading to better performance and higher probability of survival.     

EXAMINATION OF A PATH MODEL RELATING INFORMATION TECHNOLOGY INFRASTRUCTURE WITH FIRM PERFORMANCE

This article draws on the resource‐based view of the firm to investigate the mechanisms through which information technology (IT) impacts firm performance. Research suggests that the relationship between IT and firm performance may be both direct and indirect. In this study, a path model is tested that proposes a firm's IT infrastructure resources as having both a direct impact on organizational performance, as well as an indirect effect that is propagated through its impact on an intermediate organizational resource, a firm's logistics information system (LIS). The results suggest that positive firm performance may be derived directly from an organization's superior IT infrastructure, as well as indirectly, through its enabling impact on LIS's. These findings contribute to our understanding of the nature of the relationship between IT and firm performance by exploring the value of IT at both the process and organizational levels.     

Movements, bandwagons, and clones: Industry evolution and the entrepreneurial process

Entrepreneurship research has paid insufficient attention to the context in which new businesses are started. Consequently, efforts to identify factors that consistently lead to entrepreneurial success have failed. This is because what works in one context will not necessarily work in another. Even worse, factors that lead to success in one context may lead to failure in another.This article addresses this problem by drawing from the concept of industry evolution to identify three broad but distinct organizing contexts—emerging, growth, and mature industries—and demonstrating how each context presents a different set of entrepreneurial challenges. An industry is defined not as a group of firms producing close substitutes, but instead, as a group of firms of the same organizational form. Industry evolution is understood therefore as the diffusion of an organizational form, with emerging, growth, and mature stages corresponding to the creation, exploitation and erosion of competitive advantage. Defining an industry in this manner makes it possible to overcome the problem of shifting industry boundaries and enables us to distinguish between entrepreneurial activities that shake up existing industries by creating new and competing organizational forms and entrepreneurial activities that replicate well-known organizational forms and drive an industry toward equilibrium. It also enables us to draw from the work of industrial organization economics, strategy, and population ecology.Entrepreneurship is defined as the creation of new organizations and is viewed as a context-dependent social process. New organizations are enacted as critical stakeholders change their behaviors in ways that allow the organization to emerge. The process is successful when the short-term existence of a new organization is no longer at risk. A typological theory of entrepreneurial success is developed by examining how the fit between context and four other critical dimensions cause successful foundings. The theory is multiplicative and probabilistic. It is multiplicative in that all dimensions need to fit for a founding to be successful. Poor fit in any one area can lead to failure. It is probabilistic in that the better the overall fit, the better the odds of success.In addition to context, the dimensions we examine are entrepreneurial networks, entrepreneurial confidence-building behaviors, the motivation of stakeholders, and organizational structures and strategies. In terms of entrepreneurial networks, we examine whether entrepreneurs have weak-tie or strongtie networks, and whether their networks are homogeneous or include subgroups that are unrelated. In terms of confidence-building behaviors, we explore the use of informal (e.g., repeated personal interaction) versus formal (e.g., contracts) mechanisms. With respect to stakeholder motivations, we ask whether stakeholders are driven by social or instrumental motivations. In terms of structure and strategy, we consider two issues. First, we explore whether the emerging organization is market or hierarchy based, and we consider the extent to which the organization is innovative versus imitative. We argue that these various dimensions come together in three logical configurations, that we label movements, bandwagons, and clones.EMERGING INDUSTRY ORGANIZING: MOVEMENTSMovements are the organizing processes through which new organizational forms are created. Pioneers of new forms of organizations have unique personal networks that enable them to see the potential of bringing the factors of production together in new combinations. They have strong ties to two or more nonoverlapping networks. To succeed, they must overcome problems associated with lack of legitimacy. Theentrepreneur is joined by highly committed stakeholders who are motivated by social factors. Belief in the venture's success is achieved through informal confidence building, such as incremental personal exchange and third-party reputation. In this manner, stakeholders develop personal familiarity with the form and make positive assessments about the entrepreneur's competence and trustworthiness. The organizing structure is market based with participant commitments being secured through flexible, cooperative agreements. The strategic emphasis is on innovation and experimentation. The belief in the importance and viability of the new organizational form serves as a loose ideology for controlling and coordinating the actions of participants.GROWTH INDUSTRY ORGANIZING: BANDWAGONSBandwagons are organizing processes that seek to exploit the potential of a newly legitimated form. The strategic challenge at this stage is to prosper newly legitimated form. The strategic challenge at this stage is to prospeamidst rapid growth and change. The successful entrepreneur has an extensive network of high status individuals that can be tapped to quickly mobilize resources within a narrow window of opportunity. Stakeholders are motivated less by social factors, than by a desire to secure the benefits of being early movers. Formal confidence-building mechanisms dominate. In an effort to achieve efficiencies, develop sources of competitive advantage, and preempt the competition, more value-chain activities are developed in house. The strategic posture remains entrepreneurial; however, more emphasis is placed on following the example of other firms.MATURE INDUSTRY ORGANIZING: CLONESClones are the organizing processes that replicate existing forms and incorporate all that has been learned about a given industry and type of business. Strong competition along with stable demand and technology make it difficult to find a source of competitive advantage in a mature industry. At this stage, the successful founder is someone with extensive industry knowledge and contacts who is capable of extracting operating efficiencies and/or identifying some underserved market segment. Expected returns are modest and stakeholders need to be motivated partly by social factors. However, the large amount of information now available about the form and the market itserves enables stakeholders to base their participation decisions on a rational assessment of expected future benefits. Given increased experience with the form, the relationships between the organization and its stakeholders are more predictable and as a consequence, subject to greater formalization. Models exist showing how to structure theserelationships, facilitating greater use of more specific contracts and guarantees. With tight margins and the need for efficiency, greater use is made of hierarchy in an attempt to manage costs. These same highly competitive conditions also make mistakes very expensive. The organization needs to draw upon the knowledge that others have learned about the form. Consequently, it adopts a more conservative strategic posture and is less likely to deviate from established practice.IMPLICATIONS FOR FUTURE RESEARCHIf we are ever to understand what leads to entrepreneurial success, we must pay more attention to the context in which organizing occurs. Our typology suggests that fundamentally different processes may be at work at different stages of industry evolution. In addition to empirically testing our theory, an opportunity exists to reexamine the existing entrepreneurship literature through a new conceptual lens, asking how our interpretation of the research would differ if context was considered explicitly. Our theory also has the potential to inform questions about the role of organizational foundings in the diffusion of competitive advantage and to examine the impact of.founding conditions on long-term strategic adaptation.     

Vertical integration in production and services: development in transaction cost economics

In this paper, we first establish the core, fundamental concepts of Williamson’s TCE, examining the different governance structures or the institutional alternatives that TCE theory proposes. We go on to describe some critical considerations and theoretical proposals that correspond fundamentally to Williamson’s heuristic model, the integration of incentives in organizational forms, idiosyncratic demand, and how the concept of transaction is conceived in general.     

Assessing business value of Big Data Analytics in European firms

In the strategic management field, dynamic capabilities (DC) such as organizational agility are considered to be paramount in the search for competitive advantage. Recent research claims that IT business value research needs a more dynamic perspective. In particular, the Big Data Analytics (BDA) value chain remains unexplored. To assess BDA value, a conceptual model is proposed based on a knowledge-based view and DC theories. To empirically test this model, the study addresses a survey to a wide range of 500 European firms and their IT and business executives. Results show that BDA can provide business value to several stages of the value chain. BDA can create organizational agility through knowledge management and its impact on process and competitive advantage. Also, this paper demonstrates that agility can partially mediate the effect between knowledge assets and performance (process level and competitive advantage). The model explains 77.8% of the variation in competitive advantage. The current paper also presents theoretical and practical implications of this study, and the study's limitations.     

Relational Norms in Interfirm Exchanges: From Transactional Cost Economics to the Service-Dominant Logic

Purpose: This article investigates the implication and importance of the service-dominant (S-D) logic to the increasingly relevant study and practice of Interorganizational relational exchange. It points out that relational exchange theory (norms) is an earlier reflection of the S-D logic. Recognizing a need for the transactional cost economics (TCE) framework to address bilateral or hybrid types of exchanges, marketing channel researchers have for over twenty years incorporated relational exchange theory (RET) and TCE to investigate problems of formal contract, environmental uncertainty, power/dependency, and opportunism. However, some theoreticians view relational modes of exchange to be broader in scope than that studied within TCE. We propose a conceptual framework that incorporates TCE constructs with S-D logic principles in order to provide a rich contemporary guide for future relational exchange research and practice.

Methodology/Approach: We first expose the essential elements of the S-D logic and describe relational exchange theory and the problems generated by TCE. Database searches reveal a continuous stream of fifty empirical studies between 1988 and 2009 in which Macneil's relational norms were operationalized in the context of interfirm exchanges. The studies are analyzed from the viewpoint of TCE and the emerging S-D logic. The empirical findings were also discussed in terms of their contribution to validating a fundamental premise of the S-D logic. Subsequently, using S-D logic's conception of operant resources, we suggest several avenues for developing questions and conducting future relational norms research.

Empirical Findings: The findings validate the fundamental assumption of S-D logic, that relational exchange is instrumental in the co-creation of value (exchange performance) whether service is rendered directly or indirectly through goods or a combination of both. Exchange performance is better when the formal contract exists within a relational context. Relational exchange is effective in contexts of both high and low environmental uncertainty, may attenuate the negative effects of power/dependency differences and mitigate opportunistic behavior.

Originality/Value/Contribution: This article is a comprehensive review of relational norms research. It links the empirical findings conducted within the combined conceptual approaches of relational exchange theory and the TCE framework. It provides a comprehensive discussion of the essentials of the S-D logic and its compatibility with previous relational norm research. It outlines an S-D logic inspired framework for future research linking operant resources (knowledge, skills, and technology) to relational norms, facilitators of service-for-service, and value co-creation in interorganizational exchange networks.     

Reinforcing competitive advantage through green organizational culture and green innovation

The purpose of this paper is to reveal the relationships among green organizational culture, green innovation and competitive advantage. These relationships were assessed using structural equation modeling. Data were gathered from full-time hotel employees (N: 293) and managers (N: 192) in the Antalya region of Turkey. The results indicate that green organizational culture has a positive effect on green innovation and competitive advantage. Accordingly, green organizational culture is an important determinant for green innovation and competitive advantage. In addition, green innovation acted as a full mediator of the effects of green organizational culture on competitive advantage. Specifically, green organizational culture predicted green innovation, which in turn predicted competitive advantage. Finally, considering that causal studies on green innovation in the hotel industry are limited, this study may contribute to understanding how green innovation affects competitive advantage in the hotel industry.     

From command economy to market economy with a human face: The potential role of the stakeholder approach

This article questions the wisdom of the tendency to adopt managerial capitalism, in its purest form, as the only guiding principle of the new organizational philosophy now evolving in Eastern Europe. The article's main thesis is that following the demise of the command economy, the stakeholder approach can play a pivotal role in providing social legitimacy to organizations attempting to transform and revitalize in the newly created market economy in Eastern Europe. Rather than viewing maximization of profits to the stockholders as the enterprise's sole responsibility, this approach calls for a management strategy that matches the enterprise's “values” to the “values” of all its stakeholders optimizing, over the long-term, the net (social and economic) value added to society. © 1992 John Wiley & Sons, Inc.     

Employee voice: Untapped resource or social media time bomb?

The venues by which employees can voice satisfaction, dissatisfaction, and their experiences with the organization have traditionally been limited to internal communication systems that are orchestrated and sanctioned by the organization. However, social media such as Facebook, Twitter, and LinkedIn, as well as blogs and instant messaging, now enable employees to deliver messages to hundreds or even thousands of people with a few keystrokes. . .messages that may or may not be desirable to or sanctioned by the organization. Under these circumstances, employee voice can be an untapped resource for enhancing the organization's public image or a bomb waiting to explode with devastating impact on the firm's reputation. Effective management of employee voice begins with understanding its purposes: contribution to management decision making, demonstration of partnership, articulation of individual dissatisfaction, and expression of collective bargaining. These expressions of voice can be guided and managed to a strategic advantage when organizations provide a proper organizational context along with the appropriate mechanisms for employees.     

Midea’s Re-adoption of M-form Structure

With a focus on the alignment between business strategies and organization design, this illustrative case study describes and analyzes the evolution and reform of Midea’s organizational structure when confronting both internal and external changes. As one of China’s biggest and fastest-growing household appliance enterprises, Midea adopted, discarded and readopted an M-form1 organizational structure within a five-year period from 1997. This case study first investigates the reasons behind Midea’s reform toward decentralization and the formation of governing rules to balance centralization and decentralization. Different decentralized structures are then contrasted basing on product segments, business streams or even key subsidiaries acting as second-tier group companies. After its trial transformation into an H-form company that holds majority shares in several incorporated subsidiaries, Midea chose to switch to a group company incorporated structure soon after its leadership transition in 2012. Preceding the shortening of the group’s ownership chain was the construction, refinement, and evolution of its 9+2+4 divisional structure. This case study is prepared to provoke discussion and thoughts on the (re)design of a properly decentralized structure suitable for large-sized companies with multiple businesses and the links with external and internal factors.     

How risk influences the choice of governance mode in biopharmaceutical inter-firm relationships

This paper proposes a new theoretical framework for assessing the influence of risk in shaping the governance form in biopharmaceutical inter-firm relationships. In particular, we propose a multidimensional operationalization of relational and performance risk and, by following Transaction Cost Economics (TCE) and Real Options (RO) theory constructs, we hypothesize a relation between the aforementioned risk components and the choice of governance form. Specifically, following TCE reasoning, we hypothesize that a high level of relational risk leads towards more hierarchical governance forms, while, following RO theory, we hypothesize that a high level of performance risk leads toward market-oriented governance forms; finally, we hypothesize a moderating effect of each risk component on the other. We empirically test our framework through the analysis of 353 inter-firm relationships signed worldwide between pharmaceutical and biotech companies from 2007 to 2010. The results show substantive support for our theoretical framework. Furthermore, we find a significant moderating effect of the performance risk on the TCE relation between relational risk and governance forms.     

Modular assembly in the car industry—an analysis of organizational forms’ influence on performance

In modular assembly, car manufacturers can choose to assemble the modules internally or to outsource the units assembling the modules. These module assembly units (MAUs) can be located inside or outside the assembly plants. This paper analyzes the conditions provided for MAU performance by ownership and location, the constitutive dimensions of a MAU's organizational form. Based on a case study at Volvo and theoretical arguments, the paper shows that organizational forms provide different conditions for MAU performance. It is concluded that no organizational form is best and that different forms should be used. It is also concluded that companies must control MAUs, which influences how the conditions provided by different organizational forms can be utilized.     

Organizational socialization of newcomers: the role of professional socialization

Organizational socialization is the process through which newcomers learn the requisite social and task knowledge in order to resolve role uncertainty and become organizational insiders. Successful socialization of newcomers implies better retention of employees, higher productivity, and reduced recruitment and training costs. Many organizational newcomers undergo professional socialization through education and related work experience during their schooling. These newcomers may respond differently to an organization's efforts to socialize them when compared with newcomers without any related professional education or work experience. The importance of prior work experience and professional education for organizational socialization of newcomers, however, has received attention only recently. The aim of the research reported in this paper is to investigate the moderating effects of prior related work experience and professional education on the relationship between organizational socialization tactics and newcomer's adjustment. The study was conducted with a sample of new graduates from an Asian university. Findings show that prior related work experience and professional education moderate the effects of socialization tactics on newcomer's role clarity, role conflict and organizational commitment. The moderators have effects on different outcomes and in opposite directions. The paper discusses theoretical and practical implications of these findings.     

Engaging with environmental stakeholders: Routes to building environmental capabilities in the context of the low carbon economy

The transition to a low carbon economy demands new strategies to enable organizations to take advantage of the potential for “green” growth. An organization's environmental stakeholders can provide opportunities for growth and support the success of its low carbon strategies, as well as potentially acting as a constraint on new initiatives. Building environmental capabilities through engagement with environmental stakeholders is conceptualized as an important aspect for the success of organizational low carbon strategies. We examine capability building across a range of sectors affected by the sustainability agenda, including construction, rail, water, and health care. We identify a number of emergent environmental stakeholders and explore their engagement with the development of environmental capabilities in the context of the transition toward a low carbon economy. Our conceptual framework offers a categorization of environmental stakeholders based on their position in relation to a focal organization and the potential for the development of environmental capabilities.     

虚拟企业的组织本质解释

虚拟企业作为一种新型的组织形式 ,目前 ,国内外许多的经济学家、管理学家已对其进行了多方面的研究 ,如虚拟企业的产生、定义、特点、优势等 ,但是 ,并未曾涉及虚拟企业的组织本质。采用“交易费用”理论来解释虚拟企业的产生、存在的原因 ,进而揭露其组织本质———企业间的矩阵结构。     

Organizational hybrids as biological hybrids: Insights for research on the relationship between social enterprise and the entrepreneurial ecosystem

Using the study of hybridization in evolutionary biology as metaphorical inspiration, I offer a thought experiment about the emergence and proliferation of social enterprise and the influence of hybrid organizing on the entrepreneurial ecosystem. After establishing a number of analogues between biological and organizational hybrids, I analyze the degree to which social enterprise may be indicative of hybrid speciation – i.e., a new organizational form – versus introgressive hybridization – i.e., a variant of a more traditional organizational form. I then use the metaphor to examine whether social enterprise: (1) possesses distinct rules and features, (2) is shaped by or shaping the entrepreneurial ecosystem, (3) still remains a hybrid organization, and (4) might even be considered an invasive species.     

Strategies,technologies, and organizational learning for developing organizational innovativeness in emerging economies

Innovativeness is an important organizational capability for competitive advantage sustainability in the dynamic environment of Asia's emerging economies. Drawing upon dynamic capability theory, this study develops a research model of organizational innovativeness development for firms in emerging economies. The proactive strategic orientations reflected by entrepreneurship and technology oriented strategy provide important visions for organizational innovativeness. Further, the utilization of knowledge management systems and organizational learning are identified as intervention processes that translate these strategic orientations into real innovation capability. A survey involving 114 firms operating in China was conducted for hypothesis testing. The empirical results provide strong support and advance the knowledge of organizational innovativeness development for firms in Asia's emerging economies.     

Organizational image's partial mediation role between quality and users' satisfaction

Evidences point to the idea that organizational image may be influenced by patients' perception of service quality, and in turn may influence their expectations. The main aim of this research is to analyse the influence of perceived quality on patients' satisfaction and to evaluate the potential mediating effect that organizational image may have on the relationship between both constructs, in the specific context of primary health care. A structural equation modelling approach was applied to data collected on Portuguese primary healthcare units. Results show that perceived service quality has both positive direct and indirect effects on satisfaction, confirming the partial mediation role played by organizational image in the relationship between service quality and customer satisfaction and highlighting the importance for healthcare units' administrators to manage both the service quality and the image of the institution.