When Is Open Innovation Beneficial? The Role of Strategic Orientation

Various scholars have accomplished a great deal to better understand open innovation effectiveness. Case studies have detailed its performance effects, while other studies showed the effectiveness of an aspect of open innovation, such as collaboration with third parties, external technology commercialization, and cocreation. Though most studies report a positive relation between open innovation and innovation performance, some studies indicate possible negative effects. This has resulted in a call for research on what kind of organizational context suits open innovation best. This study therefore addresses two questions: (1) does performing open innovation activities lead to increased innovation performance, and to which aspects of innovation performance is open innovation most strongly related? (2) what is the moderating impact of various kinds of strategic orientation on the relation between open innovation and innovation performance? In this study, we investigate three types of strategic orientations: entrepreneurial orientation, market orientation, and resource orientation. In a survey among 223 Asian service firms, we first develop and test a comprehensive measurement scale for open innovation that captures the entire range of open innovation activities, including outside‐in activities, inside‐out activities, and coupled activities. The final scale comprises of 10 items and indicates to what extent a firm has implemented open innovation activities. Next, we study the relation between open innovation and innovation performance. The results indicate that performing open innovation activities is significantly and positively related to all four dimensions of innovation performance: new product/service innovativeness, new product/service success, customer performance, and financial performance. The impact of open innovation is not limited to a particular aspect of innovation performance; it positively affects a broad range of innovation performance indicators. Though open innovation is positively related to all four dimensions of innovation performance, the effect sizes are not equal. The impact on new service innovativeness and financial performance is relatively stronger. Regarding the influence of a firm's strategic orientation, we find that all significant moderation effects are positive. This suggests that, in general, having a more explicit strategic orientation enhances the effectiveness of open innovation. When comparing the three strategic orientations, entrepreneurial orientation strengthens the positive performance effects of open innovation significantly more than market orientation and resource orientation do. In turn, market orientation has a significantly stronger moderation effect than resource orientation. These findings provide empirical evidence of the context dependency of open innovation. Especially an entrepreneurial orientation, which is associated with proactive and entrepreneurial processes, seems to create a fertile setting for open innovation.     

Are Unions Good or Bad for Organizations? The Moderating Role of Management's Response

Union impact research has been hindered by an underdeveloped conceptualization of management response, contributing to inconclusive empirical findings. Integrating the collective voice/institutional response model with the appropriateness framework, we propose that an employee‐focused business strategy is a critical moderating variable in the relationship between union density and organizational outcomes that mitigates the negative effects of unions and enhances the positive effects by sending a clear signal of management's intentions to co‐operate. Using a panel dataset of Canadian organizations over six years, we provide empirical evidence to support our arguments. Implications for theory and practice are discussed.     

When Do Companies Train Low-Skilled Workers? The Role of Institutional Arrangements at the Company and Sectoral Level

The article investigates how institutional arrangements at the organizational and sectoral level affect the likelihood and size of employer investments in continuing training for low-skilled workers in Germany. By building on comparative political economy and organizational theory, hypotheses are derived and tested. Regression analysis based on the IAB Establishment Survey (waves 2011 and 2013) shows evidence that the training participation of low-skilled workers is related to institutional differences between sectors and organizations. At the organizational level, structures of employee representation and formalized HR policies are positively associated with higher rates of training participation among low-skilled workers. Moreover, there is evidence that low-skilled workers benefit in organizational clusters that are characterized by structures of employee representation, formalized HR practices, and bargaining coverage. At the sectoral level, this study finds evidence that low-skilled workers in the health care and manufacturing sector are more likely to receive continuing training.     

When Does Customer Orientation Hinder (Help) Radical Product Innovation? The Role of Organizational Rewards

Prior marketing literature offers a compelling theoretical rationale in support of two contradictory propositions, namely, that customer orientation is negatively related to (i.e., hinders) radical product innovation and that customer orientation is positively related to (i.e., helps) radical product innovation. In this research, the contextual conditions that determine the validity of these contradictory propositions are identified. Drawing from the literature on organizational rewards, two types of organizational rewards—outcome based and strategy based—are identified as being the key contextual conditions. It is hypothesized that when outcome‐based rewards are in effect, customer orientation is negatively related to radical positive innovation and, that when strategy‐based rewards are in effect, customer orientation is positively related to radical product innovation. Results from a survey of 156 manufacturing firms, and from a survey of 97 of their customers, provide support for these hypotheses. While prior research has attempted to explain the contradictory nature of the relationship between customer orientation and radical product innovation using typology‐based and mediator‐based approaches, the contextual condition‐based approach has not been well developed. This gap is addressed by the present research. From a practitioner perspective, the research is important because it identifies a concrete mechanism that new product development managers can deploy, in tandem with customer orientation, if they intend to generate radical product innovations. Given the potential gains that flow from radical product innovation, the research findings are expected to be of considerable interest to managers of new product development projects.     

The UK Gender Pay Gap 1997–2015: What Is the Role of the Public Sector?

The Labour Force Survey is used to examine the influence of sector on the UK gender pay gap 1997–2015. The assessment is twofold: first comparing gender pay gaps within sectors and second through identifying the contribution of the concentration of women in the public sector to the overall gender pay gap. The long‐term narrowing of the gender pay gap, which predominately reflects relative improvements in women's productivity‐related characteristics, is found to stall in 2010 within each sector. This is considered in the context of claims that public sector austerity represents a critical turning point in progress toward gender equality at work.     

When do firms change technology‐sourcing vehicles? The role of poor innovative performance and financial slack

This paper examines the adjustments firms make to the composition of their portfolios of technology‐sourcing vehicles (i.e., alliance, acquisition, or go‐it‐alone) in response to poor innovative performance. We advance a behavioral perspective on the make/buy/ally question, suggesting that differences in financial slack will generate different portfolio decisions. Specifically, we posit that firms with greater levels of financial slack are more likely to respond to poor innovative performance by opting for (1) greater vehicle diversification, and (2) new sourcing vehicles, while firms with less financial slack will respond by (1) downscoping their portfolio of sourcing vehicles, and (2) reverting to more familiar vehicles. We find support for our predictions using extensive data from the population of U.S. public pharmaceutical firms from 1992 to 2006. Copyright © 2015 John Wiley & Sons, Ltd.     

The Role of Employee Stock Purchase Plans — Gift and Incentive? Evidence from a Multinational Corporation

Employee share purchase plans (ESPPs) give free or discounted shares of stock to workers who buy shares in the hope that the greater share ownership will retain workers, build loyalty and raise productivity, as in gift exchange models. Using measures of workers’ organizational loyalty and sense of ownership in a multinational firm that puts the ESPP at the heart of its compensation policy, we find that workers who join the ESPP have lower turnover intentions and do less on‐the‐job search than others, motivated in part by gift exchange reciprocity, and also respond to the group incentive of ownership with greater work effort, longer hours, and lower absence rates. Workers in workplaces with high perceived rates of ESPP participation are more likely to intervene against shirkers. The results appear robust to the selectivity of who joins the ESPP. The mix of gifting shares to workers who buy shares and the group incentive of ownership makes ESPPs a unique dual form of compensation.     

The Enduring Alliance? Trade Unions and the Making of New Labour, 1994–1997

The period of Tony Blair's leadership preceding the 1997 general election saw a transformation of the Labour Party. This was of immense importance to the political role of trade unions. The emergence of New Labour can only be understood through analysis of developments in both party and unions. This paper discusses the recasting of the party's industrial politics and reform of party structure, locating its provenance in electoral, representational and governmental strategies. It examines the unions' response, rooted in their industrial predicament but shaped by political reaction to it. Union politics intersected but did not coincide with the policies of New Labour. Political differentiation in the unions and opposition to New Labour is considered. It is concluded that change represents restructuring rather than termination of the link, but it will be further tested with New Labour in government.     

How Should Customers Be Integrated for Effective Interorganizational NPD Teams? An Input–Process–Output Perspective

Interorganizational new product development (NPD) teams with business customers are rapidly becoming more prevalent; yet the drivers of such cooperations at the team level remain unclear to practitioners and researchers alike. This study proposes an input–process–output model in which various characteristics of interorganizational teams affect NPD team effectiveness through the mediating construct of NPD team cooperation. Furthermore, various moderators, reflecting the supplier's dependence on the customers (customer power and customer participation) and the supplier's environmental uncertainty (market dynamism and technological turbulence), affect the strength of the underlying relationships. The results show that customer power positively affects the relationship between intrapersonal team characteristics and team cooperation. In addition, a negative moderation occurs in interpersonal characteristics. Customer participation exhibits opposing moderating effects. Regarding the supplier's environmental uncertainty, market dynamism and technological turbulence strengthen the relationships under consideration.     

When does guanxi bolster or damage firm profitability? The contingent effects of firm- and market-level characteristics

This paper advances that a nuanced approach is necessary to understand the effectiveness of managerial ties (guanxi) in improving firms' financial performance. We take a contingency approach to examine how the effects of managerial ties on performance may be moderated by firm-level factors (i.e., firm age and entrepreneurial orientation) and market-based forces (i.e., demand uncertainty and technological turbulence). Using a survey of 289 firms in China, we find that managerial ties are more salient with regard to enhancing performance for more entrepreneurial-oriented and younger firms. Managerial ties fail to provide performance benefits to firms when high demand uncertainty exists or when the level of technological turbulence is high, which suggests a performance limitation of established ties with government officials, buyers, suppliers, and competitors. The theoretical and managerial implications of the findings are further discussed.     

An Attitudinal Revolution in Irish Industrial Relations: The End of ‘Them and Us’?

Intensified international competition and high unemployment have characterized many Western economies since 1980. A firm's survival in such an environment demands a flexible and co-operative work-force, a requirement incompatible with traditional adversarial industrial relations. Drawing on a survey of employees in nine unionized companies in the Irish manufacturing sector, this paper examines the effect of these changes in the economy and workplace in facilitating a significant reduction in 'them and us' attitudes and an associated weakening of union structure and influence in the workplace. We found no evidence of a reduction in 'them and us' attitudes, but a cohesive and influential union was associated with less intense 'them and us'.     

How does CEO tenure matter? The mediating role of firm‐employee and firm‐customer relationships

While the direct influence of CEO tenure on firm performance has been examined in the strategy literature, the underlying channels of influence have remained largely unexplored. This article draws upon the career seasons paradigm, learning perspectives, and marketing literature to examine whether firm‐employee and firm‐customer relationships are the pathways through which CEO tenure influences firm performance. Results from the analysis of a large data set reveal that: (1) CEO tenure has a positive and linear association with firm‐employee relationship strength but an inverted U‐shaped association with firm‐customer relationship strength; (2) industry uncertainty intensifies these associations; and (3) firm‐employee and firm‐customer relationship strength mediate the effects of CEO tenure on firm performance. These findings have implications for a more balanced and nuanced view of CEO tenure. Copyright © 2013 John Wiley & Sons, Ltd.     

Do HR System Characteristics Affect the Frequency of Interpersonal Deviance in Organizations? The Role of Team Autonomy and Internal Labor Market Practices

Current research on determinants of interpersonal deviant behaviors in organizations, including incivility, bullying, and sexual harassment has focused primarily on the effects of individual‐level characteristics while neglecting inter‐organizational differences in human resource (HR) systems that shape the context for employee interactions at work. Using data from a nationally representative survey of over three hundred U.S. work establishments, I find empirical support for theory‐based predictions that organizations with HR systems characterized by greater use of internal labor markets and less team autonomy are associated with lower frequencies of reported interpersonal deviance behaviors than those that rely on external labor markets and self‐managed teams.     

Should Firms Consider Employee Input in Reward System Design? The Effect of Participation on Market Orientation and New Product Performance

Will increasing employee participation in reward decisions increase new product performance by first increasing a firm's level of market orientation? Literature offers limited insight to the effects of listening to employees regarding reward system design and whether this may influence market orientation implementation and new product performance. This paper provides research to fill the gap by examining the relationship between participation‐based reward systems, market orientation, and new product performance. Based on expectancy theory, a conceptual model was developed suggesting that participation‐based rewards will increase market orientation by considering employees' desires regarding performance rewards. To test the model, a mixed method was used to collect data. First, in‐depth interviews were conducted with managers from 11 different firms to verify the proposed model. Then a multi‐industry sample of managers from 290 firms was surveyed to maximize generalizability of the results. Data were analyzed using structural equation modeling techniques to simultaneously fit the measurement and structural models. The findings show that market orientation significantly impacts objective new product performance and mediates the relationship between participation‐based rewards and objective new product performance. Participation‐based rewards positively affect market orientation but surprisingly affect new product performance negatively, while positively moderating the relationship between market orientation and new product performance. The results suggest that managers should include employee input in designing reward systems. However, managers should also be careful of how much input they allow employees in determining their rewards and goals as more input will improve market orientation or responding to information collected by, and disseminated throughout the firm, and that, in turn, will improve some types of new product performance. However, the direct effect of employee input can decrease new product performance suggesting that there may be a trade‐off between various success measures of new products developed and introduced by the firm.     

How do SOEs and FIEs affect POEs’ performance in emerging economies? Moderating effects of managerial ties

Asia Pacific Journal of Management - In emerging economies, informal ties are important instruments that firms use to overcome market competitiveness disadvantages. Higher proportions of...     

The role of competition and regulation in stimulating innovation – Telecommunications

The telecommunications sector is innovative and its innovations strongly affect the growth of the rest of the economy. While regulatory policy has therefore shifted towards innovation as its major goal besides enabling competition, there appear to be tensions between regulation, competition and innovation. This paper identifies as the roots of these tensions the consumer protection objective enshrined in regulatory legislation and the regulatory neutrality issues arising from stranded assets, loss of labor rents, loss of services by captive customers, and the threat to regulators from looming deregulation, all of which are associated with innovations. This paper identifies some similar threats to innovation in unregulated sunk-cost industries with a monopolistic incumbent. A very simple model shows that a comparison of innovation incentives in such an unregulated industry with a regulated one leads to ambiguous results. However, the prospect of converting a regulated industry into an unregulated one after the innovation has occurred will unambiguously increase innovation incentives.     

When Will Employees Embrace Managers' Technological Innovations? The Mediating Effects of Employees' Perceptions of Fairness on Their Willingness to Accept Change and its Legitimacy

Innovation researchers have thoroughly discussed how attitudes toward innovation influence people's intentions to use it. Most prior research tried to explore employees' acceptance of technological change through the lens of change initiators; however, using a manager's or the “great man's” perspective to explain change recipients' reaction to an innovation is indirect and peripheral. This paper argues that innovation should be studied directly from the perspective of change recipients, and that their perceptions of fairness in the wake of an innovation become a key factor in their willingness to accept it. More specifically, this paper argues that the recipients' fairness perceptions mediate the impact of innovation characteristics (operationalized as “usefulness” and “ease of use”) and implementation approach on their acceptance and belief in the legitimacy of the innovation. Two studies investigated the hypothesized mediating effects of procedural fairness/outcome fairness. The field study was conducted in a real‐world technological innovation setting, but raised questions about whether the causal effect of the mediating model really existed. The scenario study was conducted in a semi‐experimental condition which had high internal validity and guaranteed the cause–effect relation. Hence, the research design of the two studies complemented each other. The multiple regression analyses using the criteria proposed by Baron and Kenny were used to test the mediating models in the paper. Moreover, both Sobel tests and bootstrapping methods were used to guarantee that the mediating paths do exist among the independent variables, mediators, and the dependent variables. Both the field study and the scenario study showed that most of our hypotheses were supported, and change recipients had strong psychological reactions to the innovation and how the innovation was implemented in terms of fairness perceptions. Change recipients' perception of procedural and outcome fairness mediated the impact of innovation characteristics and implementation approach on their acceptance of the innovation and the perceived legitimacy of the innovation. The results disclosed that the change recipients' fairness perceptions were a key step for their sense‐making process of an innovation and its implementation. The results also indicated that studying change from recipients' perspective, as well as trying to understand their fairness perceptions, can broaden our knowledge about change. Other theoretical and practical implications were also discussed.     

Is a Big Entrant a Threat to Incumbents? The Role of Demand Substitutability in Competition Among the Big and the Small

We establish a model of market competition between large and small firms and investigate the way in which demand substitutability affects how the entry of big firms impacts incumbents. We focus on the relative strength of two opposing effects of entry on large incumbent firms’ demand: the direct substitution effect among large firms (negative) and the indirect feedback effect through the change in small firms’ aggregated behavior (positive). If the substitutability between large and small firms is sufficiently high, the indirect effect dominates the direct effect and large incumbents’ equilibrium prices and profits increase. We show that welfare effects are ambiguous, which calls for careful assessment when regulating large firms’ entry.