Context and Action in the Transformation of Strategy Scholarship

We revisit Andrew Pettigrew's seminal ‘Context and action in the transformation of the firm’, first published in this journal in November 1987. In doing so, we not only review Pettigrew's contributions, but contextualize these with respect to adjoining strategy scholarship. Our discussion concludes with some novel, and fairly speculative, ways forward, designed to advance strategy scholarship. Working with the ideas contained in Pettigrew's article and drawing on insights from institutional entrepreneurship, we make a case for the processualization of strategy content research. This allows us to add the issue of effectiveness of strategy practices to current strategy‐as‐practice research while arguing for a further humanization of strategic management.     

Listening to accounting

There are algorithms for the transformation of accounting data into music, and there is suggestive evidence that it is possible to hear different patterns in it than we see when it is transformed into a graph. We cannot say with certainty whether those different patterns are really there, and we cannot even say that if they were, we would be able to perceive them audibly without a disciplining education similar to that which has traditionally taught us to seek and find patterns—knowledge—visually. We can say, however, that there is reason to believe that the mental pathways for the creation of auditory patterns and visual patterns are different. One forms anticipations of events in time; the other forms structures of points in space. One engages the emotions more directly than the other. Each employs different parts of the brain. There are indeed reasons why we might hear something more or at least something else in the music generated by an algorithm than we might see in a picture that was created from the same data.     

A globally consistent framework for reliability-based trade statistics reconciliation in the presence of an entrepôt

This paper develops a mathematical programming model to reconcile trade statistics subject to a set of global consistency conditions in the presence of an entrepôt. Initial data reliability serves a key function for governing the magnitude of adjustment. Through a two-stage optimization procedure, the adjusted trade statistics are achieved as solutions to a system of simultaneous equations that minimize a quadratic penalty function. As an empirical illustration, the model is applied to reconcile the 2004 trade statistics reported by China, Hong Kong and their major trading partners, initialized with detailed estimates of bilateral trade flows, re-export markups, cif/fob ratios and data reliability indexes.     

The effects of budget goals and task interdependence on the level of and variance in performance: a research note

The effects of goal setting and task interdependence on both the level of and variance in performance are examined using a laboratory, resource allocation task. The results show, consistent with existing research, main effects for goal setting and task interdependence on the level of performance, but no goal setting by task interaction effect as hypothesised. The results also show that an increase in task interdependence increases performance variance but that goal setting reduces it with important implications for budget setting.     

Posted rates and mortgage lending activity

In many metropolitan areas (MSAs) newspapers post mortgage terms for lenders in a manner designed to permit an easy comparison of discount points and note rates. Using these advertised rates for 73 lenders in three MSAs we examine 1) how applicants respond to short-run changes in relative rates, and 2) the relationship between the services provided and quality of applications received by lenders and their long-term market positions. We find that applicant flows increase when lenders lower their rates. We also find that persistent cross-lender differences in rates are associated with differences in product quality reflected in processing times, loan sales, and FHA/VA lending; and that high-risk borrowers tend to apply to lenders posting above-average rates.     

‘Obedience’ in the classroom

The second general standard of the AICPA states “In all matters relating to the assignment, an independence in mental attitude is to be maintained by the auditor or auditors.” Despite assertions that the ultimate responsibility of independence rests with the individual auditor, emphasis is typically placed on the AICPA's code of ethics in the auditing classroom. But, does such an approach reflect and accentuate the ultimate moral responsibility of the individual? The purpose of this paper is to discuss the use of Milgram's film “Obedience,” which portrays a psychological experiment on response to authority, as a means of dramatizing the subtle nature of “mental independence” to auditing students.The paper describes the use of this film in auditing instruction and the corresponding response of students. Recommendations for effective administration of the film are offered.     

The Chinese negotiation

Most Westerners preparing for a business trip to China like to arm themselves with a list of etiquette how-tos. "Carry a boatload of business cards," tipsters say. "Bring your own interpreter." "Speak in short sentences." "Wear a conservative suit." Such advice can help get companies in the door and even through the first series of business transactions. But it won't sustain the prolonged, year-in, year-out associations Chinese and Western businesses can now achieve. The authors' work with dozens of companies and thousands of American and Chinese executives over the past 20 years has demonstrated that a superficial adherence to etiquette rules gets executives only so far. They have witnessed communication breakdowns between American and Chinese businesspeople time and time again. The root cause: the American side's failure to understand the much broader context of Chinese culture and values, a problem that too often leaves Western negotiators flummoxed and flailing. American and Chinese approaches often appear incompatible. Americans see Chinese negotiators as inefficient, indirect, and even dishonest, while the Chinese see American negotiators as aggressive, impersonal, and excitable. Such perceptions have deep cultural origins. Yet those who know how to navigate these differences can develop thriving, mutually profitable, and satisfying business relationships. Four cultural threads have bound the Chinese people together for some 5,000 years, and these show through in Chinese business negotiations. They are agrarianism, morality, the Chinese pictographic language, and wariness of strangers. Most Western businesspeople often find those elements mysterious and confusing. But ignore them at any time during the negotiation process, and the deal can easily fall apart.