An empirical analysis of organizational strategies by entrepreneurial high-technology firms

Many start-up, high-technology firms commercialize an emerging technology through cooperative arrangements. This paper empirically investigates the determinants of entrepreneurial high-technology firms to form cooperative relationships. The statistical results on data drawn from the commercialization of the new biotechnology show that the propensity to cooperate is positively correlated with the distance of firms' competitive position in relation to their rivals. The follower is more likely to seek cooperative relationships than the leader in commercializing new products. However, the competitive pressure impacts firms in different ways, depending on their internal capabilities to commercialize a new product. We found that firm size is negatively correlated with the use of cooperative arrangements. The study also found that the organizational mode of cooperative arrangements is predominantly selected by the high-tech. start-up firm in commercializing their new products in foreign markets.     

Stock portfolio excess returns and macroeconomic variables: An empirical analysis of the singapore stock market

Economic agents use information in forming their expectations of future returns from holding stock securities. These securities should be priced to reflect the risks due to economywide fluctuations. The information is updated given the realisations of the factors, which are taken as unobservable but that affect the utility of possibly risk-averse agents. Stock portfolio excess returns (or risk premiums) are analysed empirically within the framework of the Dynamic Factor Model which allows for serial correlation in the factors. Over the sample period 1975:1 to 1986 (January 1975 to June 1986), a single factor can parsimoniously represent ten stock portfolio excess returns. In the framework of the Dymimic model, causality tests for several macroeconomic variables are carried out to ascertain if these variables are correlated with the stock portfolio excess returns. The finding that the excess returns are correlated with the variables that enter the causal equations with a lag is consistent with the conjecture that these variables are used by economic agents in forming their expectations of future treasury security excess returns or risk premiums. Variables possibly related to real activities in the economy are not rejected as causal variables.The research was carried out under the National University of Singapore research grant RP880014. We would like to thank an anonymous referee for his very helpful comments.     

Market share,advertising, R&D,and profitability: An empirical analysis of leading industrial firms in Japan

This paper develops a dynamic model of a leader firm which chooses the time paths of R&D and advertising inputs so as to maximize the present value of expected profits. From this theoretical model simultaneous-equations system for market share, advertising, R&D, and profitability is derived and estimated using the data on the leading industrial firms in Japan. Our results show that, as far as top firms are concerned, market share and demand growth have significant positive effects on profitability, and an increase in the stock of goodwill increases market share as well as profitability.This study was financially supported by the Ministry of Education in Japan. Helpful comments were provided by H. Odagiri. Also I am indebted to an anonymous referee for advice and criticism on various points.     

Acquisition strategy and the market position of acquiring firms

Research suggests that firms which emphasize unrelated diversification through mergers and acquisitions are often located in unfavorable market positions, in terms of the attractiveness of their industries and their competitive positions within these industries. However, these previous research efforts have not established whether such positions will also be linked to firms using non-conglomerate acquisition strategies. This study utilizes three acquisition strategies—conglomerate, technology-related, and marketing-related—to hypothesize differences in the market position of acquisitive firms. Results show that, while acquisitive growth is generally associated with a decline in market position, one particular acquisition strategy, the marketing-related strategy, is associated with a distinctly superior position. Firms utilizing this strategy were found to be in more profitable industries and to have higher market shares in these industries.     

Organizational boundaries and economic performance: An empirical study of entrepreneurial computer firms

This research examines the relationship between the organizational boundaries of entrepreneurial firms and their economic performance. The theoretical basis for this work is transaction cost economics research regarding when internalizing certain activities will be preferred over contracting. To consider the conditions under which contracting is costly we compare across three functional areas and three firm strategies. The results of a longitudinal analysis of 122 entrepreneurial firms in the computer industry show that performance effects are associated with contracting activities and that product market strategies moderate the performance effects of contracting. The results are mixed in their support for the predictions of transaction cost economics.     

An empirical test of arbitrage equilibrium with skewed asset returns: Australian evidence

Barone-Adesi (1985) has formulated a multivariate test (likelihood ratio) of an arbitrage equilibrium model, based on a quadratic specification of the process generating returns, that can be related to a three-moment CAPM. Australian equity returns are used to replicate this approach over the period 1963 to 1987. Furthermore, a generalised method of moments test of the Barone-Adesi model is also conducted. The results are favourable with regard to the arbitrage model. In addition the quadratic market model performs well against its traditional counterpart. This latter conclusion is robust with respect to allowing for monthly seasonal regularities in Australian returns. However, evidence regarding the three-moment CAPM is largely inconclusive.The author is a senior lecturer in the Department of Accounting and Finance, Monash University, Clayton, Australia. The author is pleased to acknowledge the helpful comments of Tim Brailsford, two anonymous referees, the participants of the Seminar Series at Monash University, and participants of the Second International Conference on Asian-Pacific Financial Markets, Hong Kong, 1991, the 1992 Annual Conference of the Accounting Association of Australia and New Zealand and the Fifth Annual Australasian Finance and Banking Conference, Sydney, 1992.     

Technological acquisitions and the innovation performance of acquiring firms: a longitudinal study

This paper examines the impact of acquisitions on the subsequent innovation performance of acquiring firms in the chemicals industry. We distinguish between technological acquisitions, acquisitions in which technology is a component of the acquired firm's assets, and nontechnological acquisitions: acquisitions that do not involve a technological component. We develop a framework relating acquisitions to firm innovation performance and develop a set of measures for quantifying the technological inputs a firm obtains through acquisitions. We find that within technological acquisitions absolute size of the acquired knowledge base enhances innovation performance, while relative size of the acquired knowledge base reduces innovation output. The relatedness of acquired and acquiring knowledge bases has a nonlinear impact on innovation output. Nontechnological acquisitions do not have a significant effect on subsequent innovation output. Copyright © 2001 John Wiley & Sons, Ltd.     

The practice of R&D management: An empirical study of Korean firms

This paper presents an empirical study on the practice of R&D management in a Newly Industrializing Country, Korea. Based on a review of literature, a survey framework has been generated. The data were collected from 73 laboratories of Korean private companies through a structured questionnaire, via mail and additional telephone interviews in some cases. The major findings concerning R&D planning, R&D project management and evaluation, and R&D personnel management are described. In Korea, substantial efforts have been made in order to enhance the efficiency of R&D management, though the practice of R&D management is by now in the unstructured/flexible phase. Beyond this study, more detailed research on the R&D management of Newly Industrializing Countries is needed.     

Antecedents of open innovation at the project level: empirical analysis of Korean firms

The concept of open innovation has recently gained wide academic attention, as it seems to have significant impact for company performance. Most empirical investigations about this emerging concept have been case studies of successful early adopters of open innovation, and their analyses have largely been at the company level. Although case studies at that level provide meaningful implications, the new phenomena merit a more in‐depth examination: that is, we need to collect and analyze data on multiple companies to explore more systematic findings about open innovations across companies. Moreover, analyses may need to go down to the individual project rather than the whole company level because innovation activities are often conducted as part of research and development (R&D) projects. To meet these needs, this study examines companies' open innovation efforts at the level of the individual R&D project. Specifically, the present study focuses on project‐level openness to better understand the mechanisms of open innovation. It explores systematic relationships between various antecedent factors and the degree of openness. Project‐level openness could be affected by team and task characteristics, such as team size, learning distance, strategic importance, technology and market uncertainty, and relevance to the main business. Relevant data collected from 303 companies in Korea were used to identify the antecedents that affect inbound and outbound openness. The research findings are expected to help provide a concrete theoretical framework suited for more generalized application and further practical development of open innovation strategy.     

Marketing communication strategies in support of product launch: An empirical study of Taiwanese high-tech firms

To understand the mechanisms that underlie marketing communication support for product launches, the authors conduct an empirical study and propose a conceptual framework that depicts the relationships between informational/transformational or elaborational/relational messages and their effectiveness. The hypothesized message-communication and message-sales effect links are moderated by three communication process characteristics: message clarity, message uniformity, and integration of the communication. On the basis of data collected from an industrial survey of 101 high-tech firms in Taiwan, the authors find that informational and relational messages offer greater support for new products. Whereas message clarity and integration of communication expectedly demonstrate positive moderating effects on message-performance links, message uniformity only affects messages-sales effect relationships. The authors explore research insights and discuss implications for both academia and practitioners from the perspectives of new product management and integrated marketing communications.     

Constraints in acquiring and utilizing directors' experience: An empirical study of new‐market entry in the pharmaceutical industry

In this study we provide evidence that firms considering entering new markets are more likely to appoint directors with experience in those markets; and subsequently, we show that directors' market experience increases the likelihood of new‐market entry. Moreover, we explore the presence of constraints in both, acquiring experienced directors and utilizing their experience. Specifically, we find that experienced directors are less likely to join firms with financial restatements in the recent past as well as firms with a lower status than the firms where they currently serve. In addition, we find that interlocking directors' experience is less likely to lead to new‐market entry for firms that lack new‐product development experience and that exhibit a high level of market overlap with interlocked firms. Copyright © 2013 John Wiley & Sons, Ltd.     

Time-based competition: Some empirical data from Singapore

The progressive edge of competition has moved from what was primarily a cost-based strategy through that which was quality-based, and then variety-based, and now, onto the time-based mode of competition. This paper presents a status report of the response of the Singapore manufacturing sector to such a progression in competitive paradigms. In particular, we will refer to empirical data from the latest Singapore Manufacturing Futures Survey to provide an update on the apparent status of the local manufacturing environment in terms of such current paradigms of competition. From these, we will draw some implications for operations management, that is, what should local producers and suppliers do in the light of such current modes of competition. Such implications may be of help to other manufacturing businesses operating in other countries.The author is with the Department of Decision Sciences, National University of Singapore, 10 Kent Ridge Crescent, Singapore 0511.     

ICTs quality and technical efficiency: An empirical analysis

In 1987, Robert M. Solow hinted at the computer age and productivity statistics puzzle. While this puzzle persisted for many years, a growing literature has picked it up to examine the effect of ICTs on technical efficiency. However, this literature has focused mainly on quantity-based ICTs measures, which have come under severe criticism in recent times. We advance this literature in this paper by shifting the focus of analysis to quality-based ICTs measures; in this case, Internet quality. We also extend the literature by examining how the envisaged relationship between ICTs quality and technical efficiency is conditioned by a country's unique attributes. Our results show a significantly positive effect of ICTs quality on technical efficiency. We also find that the technical efficiency gains associated with ICTs quality are higher in skill-abundant countries, countries that engage more intensively in cross-border trade, have stronger contracting institutions, and are endowed with well-functioning and well-developed financial markets that ensure greater efficiency of capital allocation. We find a network effect in the nexus between ICTs quality and technical efficiency. That is, the marginal effect of ICTs quality on technical efficiency increases as the number of Internet users expands. We discuss the policy implications of our findings.     

Announcement effects and market efficiency in a thin market: An empirical application to the Singapore equity market

Studies of share price responses to public announcements have assumed that there is no serious thinness in trading. This paper reports the findings of a study of price responses of thinly-traded shares in the Singapore equity market. With appropriate methodological refinements for thinness in trading, the announcement effects of earnings, dividends and capitalisation changes are studied. The results suggest that there are statistically significant abnormal returns during the months up to and including the month of announcement. With some minor exceptions, there appears to be no significant abnormal returns during the months after the announcements: semi-strong form efficiency is thus observed. These results are consistent with prior findings in the developed capital markets.The authors wish to thank the anonymous reviewers for their useful suggestions. This paper has benefitted from financial assistance of the Department of Commerce of the University of Queensland.     

Life expectancy of international cartels: An empirical analysis

This paper quantifies the importance of the various determinants of life expectancy for international cartels active throughout this century. I explain cartels' optimal duration as a function of market structure and demand growth and estimate the associated parameters recognizing that durability cannot be negative. According to the results, increases in either market shares or cartel concentration prolong life expectancy. Faster demand growth shortens cartel durability but this effect is not reliable. I also find that growth effects are sensitive to both the period of activity and the country coverage.The calculations in this paper use LIMDEP version 5.0. I am grateful to participants in seminars at the Federal Reserve Board and the U.S. International Trade Commission; to Alexander David, Jon Faust, Michael Gibson, William Greene, James Griffin, William Helkie, Dale Henderson, John Irons, Doug Irwin, Michael Leahy, Matthew Pritsker, Stephen Salant, and Janice Shack-Marquez for several suggestions. I also received very useful comments from two anonymous referees. The views expressed in this paper are solely the responsibility of the author and should not be interpreted as reflecting those of the Board of Governors of the Federal Reserve System or other members of its staff.     

An empirical analysis of strategy types

Using the PIMS SPIYR data base, which pools cross-section and timeseries data, an empirical study to identify business strategy types was undertaken. Using a two-stage methodological approach combining principal component and cluster analysis on both a consumer products and an industrial products data base, two sets of strategy typologies were identified. Six strategy types were identified for consumer products: (1) harvest, (2) builder, (3) cashout, (4) niche or specialization, (5) climber, and (6) continuity. For industrial products, four strategy types were identified: (1) low commitment, (2) growth, (3) maintenance, and (4) niche or specialization. A discussion of the characteristics of each strategy type is offered.     

Comparative empirical observations on worker-owned and capitalist firms

The paper analyzes the available quantitative information on worker-owned and capitalist firms in a few industrialized countries in an attempt to draw a comparative profile of their respective sectors. The population of worker-owned firms is found to be heterogeneous, changing over time, and significantly different from the population of capitalist firms. Worker-owned firms are smaller, concentrate in a few industries, and since the mid 1970s have higher birth rates and lower demise rates than capitalist firms. These findings are interpreted with the aid of a theoretical framework and in a broad historical context.