Agglomeration and the choice between acquisitions and alliances: An information economics perspective

Research summary : This research extends agglomeration theory by joining it with information economics research to better understand the determinants of firms' organizational governance choices. We argue that co‐location in a common geographic cluster fosters lower levels of information asymmetry between exchange partners and thus leads firms to employ acquisitions rather than alliances for their external corporate development activities. We further extend agglomeration theory by arguing that the impact of sharing a cluster location on acquisitions versus alliances strengthens with the level and dissimilarity of the exchange partners' knowledge‐based resources as well as with the intra‐cluster geographic proximity of the partners. Evidence from a sample of over 1,100 alliance and acquisition transactions in the U.S. semiconductor industry provides support for our hypotheses. Managerial summary : This paper investigates the role of geographical clustering for firms' external corporate development activities in acquisitions and alliances. We explain how better information is likely to be available among firms co‐located in the same cluster. This suggests that managers should have less need to use alliances over acquisitions as a means of reducing the risk of adverse selection (e.g., overpaying for acquisitions). Our investigation of over 1,100 transactions in the U.S. semiconductor industry shows that common cluster co‐location increases the probability of acquisition relative to alliance. Our arguments and evidence also indicate that the information‐related benefits of cluster co‐location are even more impactful when the parties have more divergent technology bases, possess larger stocks of knowledge‐based resources, or are located in closer geographic proximity. Copyright © 2015 John Wiley & Sons, Ltd.     

Human capital enhancing HRM systems and frontline employees in Australian manufacturing SMEs

The current study seeks to answer a number of key questions concerning the strategic management of frontline employees (e.g. individuals who do not occupy an executive, managerial or supervisory role in functions such as production, maintenance, service and clerical functions) and their contributions towards the performance of small- and medium-sized manufacturing firms in Australia. This study adopts a human capital perspective to examine the employee and organisational performance of small and medium enterprises (SMEs) in Australia. We were also interested in seeking to examine the presence of the human resource management (HRM) function of SMEs in Australia and their contribution towards employee and firm performance. Findings from the partial least square analysis identified the antecedents and consequences of a human capital enhancing (HCE) approach for the strategic HRM of frontline employees in Australia's manufacturing industry. Strategic orientations of small- and medium-sized manufacturing firms mediate the contribution of the HRM function in adopting a set of HCE HRM systems. HCE HRM system was found to have a direct and indirect impact on manufacturing performance outcomes. Frontline employees' performance was found to mediate the impact of HCE HRM system on manufacturing performance outcomes. Theoretical and practical implications are discussed in relation to the management of frontline employees in enhancing perceived employee and manufacturing performance.     

The influence of relation-based and rule-based regulations on hiring decisions in the Australian and Hong Kong Chinese cultural contexts

Investigation of the cultural factors that may influence the employment decisions of managers is of increasing importance in the global business environment. The purpose of this research is to examine whether particularistic ties based on friendship influence hiring practices in relation-based (Hong Kong Chinese) and rule-based (Australian) cultural contexts. Three studies were conducted to examine this research question. Results indicate that friendship-based particularistic ties, specifically guanxi and mateship, can influence hiring decisions in both relation- and rule-based cultural contexts. The results of the studies have implications for human resource managers with regards to staffing organizations operating in different cultural contexts.     

The devolution of HR to the line: Implications for perceptions of people management effectiveness

The devolution of human resource responsibilities from human resource managers to line managers is both a growing and global trend. A number of authors has suggested that there are positive as well as negative consequences of devolution. The current study conducted a survey of US human resource managers to explore the effect of devolution on human resource managers' perceptions of people management effectiveness in their organizations. Results revealed a positive effect of devolution on perceived people management effectiveness. However, this effect was qualified by an interaction between devolution and line support. Contrary to expectation, this interaction revealed that providing line managers with training and support for their human resource responsibilities had a greater positive impact on perceived effectiveness in organizations that had not devolved (non devolvers) compared to those that had (devolvers).     

Behavioural Orientations of Non‐Profit Boards as a Factor in Entrepreneurial Performance: Does Governance Matter?

Relatively little is understood about factors triggering entrepreneurial behaviour within organizations not driven by profit motives. Governance plays an important role in non‐profits, particularly boards of directors. Integrating resource‐based theory and entrepreneurial orientation research, we examine the influence of non‐profit boards as strategic resources shaping the organization's entrepreneurial orientation and performance. In particular, we focus on the non‐profit board's underlying behavioural orientations, or the extent to which the board is strategic, activist, conservative, and cohesive. Findings from a cross‐sectional survey on arts and culture organizations demonstrate that three of these behavioural orientations impact levels of entrepreneurship occurring within non‐profits. Higher levels of entrepreneurship affect social performance, but not financial performance.     

A strategic human resource perspective of firm competitive behavior

Embedded within firms are unique stores of intangible human assets that likely influence the way firms compete. We argue that the human and social capital of a firm, particularly at the upper echelon and board of director (BOD) levels, contribute to the firm's awareness of the competitive environment and its motivation and ability to undertake numerous, complex, and forceful competitive actions. We also suggest that the firm's executive compensation systems moderate the effects of these intangible human assets on firm competitive behavior. By examining how human capital, intra-firm social capital, and executive compensation influence firm competitive behavior, we advance a strategic HRM perspective of firm competitive behavior and outline several implications for future research.     

ARE ALL ECONOMIC FACTS GREATLY EXAGGERATED? THEORY COMPETITION AND SELECTIVITY

Abstract ..There is growing concern and mounting evidence of selectivity in empirical economics. Most empirical economic literatures have a truncated distribution of results. The aim of this paper is to explore the link between publication selectivity and theory contests. This link is confirmed through the analysis of 87 distinct empirical economics literatures, involving more than three and a half thousand separate empirical studies, using objective measures of both selectivity and contests. Our meta–meta‐analysis shows that publication selection is widespread, but not universal. It distorts scientific inference with potentially adverse effects on policy making, but competition and debate between rival theories reduces this selectivity and thereby improves economic inference.     

The spillover effects of infill developments on local housing prices

This paper examines the spillover effects of infill developments, which involve developing vacant or under-used parcels within existing urban areas that are largely developed, on local housing prices. Employing a difference-in-difference specification on a sample of 275 new developments and 55,887 sale transactions of houses in Singapore, we find that infill developments have a positive and persistent impact on local housing prices. The contagion effect is larger for infill developments that are built on teardown sites. The spillover effect can also be traced to the overpricing of new homes by developers. Overall, the evidence indicates that developers act as price leaders and contribute significantly to price discovery in the local housing market.     

Examining the impact of information technology and patient flow on healthcare performance: A Theory of Swift and Even Flow (TSEF) perspective

The impact of information technologies on manufacturing operations and performance is well established. However, scant research has been devoted to examining information technology (IT) investment among hospitals and how it influences patient care and financial performance. Using the lens of the Theory of Swift Even Flow (TSEF), we present an operations management-based perspective on the effect of IT in streamlining hospital operations. Specifically, we examined the role of IT on patient flow and its consequences for improved hospital efficiency and performance.     

Information systems and technology sourcing strategies of e-Retailers for value chain enablement

In the e-Retail industry, a well-designed IT infrastructure is essential in creating a tightly integrated value chain and delivering high quality service. With intense competition for market share and profits, information systems and technology (IST) sourcing decisions are becoming increasingly important to e-Retail firms to support continued growth and market responsiveness. Drawing on the contingency theory, we examine organizational and environmental factors that influence an e-Retailer's IST sourcing strategy of make versus buy in enabling its value chain activities, and we also look at firm-level performance impacts of IST sourcing decisions that involve bundling across value chain activities. We test the proposed model and hypotheses using a panel data set of 307 firms over the period of 2006–2010. The results show that firms that make transformative IT investments tend to source a smaller portion of IST for their e-Retail value chain activities than firms that pursue automate or informate as their strategic role for IT investment. Capabilities are positively associated with IST sourcing. Firms experienced in e-Retail are more likely to build rather than buy their IST. In addition, we find mimicking behavior for IST sourcing among firms in the same merchandizer category. We find that IT strategic role is strongly associated with growth metric, whereas sourcing decisions predominantly impact operational performance measures. There is partial evidence that alignment between IT strategic role and IST sourcing decisions results in better performance effects. Moreover, complementary IST sourcing of synergistic marketing and sales activities positively impacts Web sales and conversion rate, but the sourcing combination of logistics, operations, and sales activities is associated with lower Web sales and conversion rate.