bluuebunny/crossref_metadata_2025 huggingface dataset:
Organizations as Adaptive Systems in Complex Environments: The Case of China
Authors: Boisot Max , Child John
Published: October 2008

This paper treats organizations as adaptive systems that have to match the complexity of their environments. The nature of this complexity is analyzed by linking an institutional Information-Space (I-Space) framework to the work of complexity theorists. The I-Space framework identifies the codification, abstraction, and diffusion of information as cultural attributes. Codification involves the assignment of data to categories, thus giving them form. Abstraction involves a reduction in the number of categories to which data needs to be assigned for a phenomenon to be apprehended. Information is diffused through populations of data-processing agents, thus constituting the diffusion dimension. Complexity theorists have identified the stability and structure of algorithmic information complexity in a way that corresponds to levels of codification and abstraction. Their identification of system parts and the richness of cross-coupling draws attention to the fabric of information diffusion. We discuss two modes of adaptation to complex environments: complexity reduction and complexity absorption. Complexity reduction entails getting to understand the complexity and acting on it directly, including attempts at environmental enactment. Complexity absorption entails creating options and risk-hedging strategies, often through alliances.

The analysis, and its practical utility, is illustrated with reference to China, the world's largest social system. Historical factors have shaped the nature of complexity in China, giving it very different characteristics than those typical of Western industrial countries. Its organizations and other social units have correspondingly handled this complexity through a strategy of absorption rather than the reduction strategy characteristic of Western societies. Western firms operating in China therefore face a choice between maintaining their norms of complexity reduction or adopting a strategy of complexity absorption that is more consistent with Chinese culture. The specifics of these policy alternatives are explored, together with their advantages and disadvantages.

The paper concludes with the outlines of a possible agenda for future research, focusing on the investigation of complexity-handling modes and the contingencies which may bear upon the choice between them.
Path Dependence, Competition, and Succession in the Dynamics of Scientific Revolution
Authors: Sterman John D. , Wittenberg Jason
Published: October 2008

What is the relative importance of structural versus contextual forces in the birth and death of scientific theories? We describe a formal dynamic model of the birth, evolution, and death of scientific paradigms based on Kuhn's Structure of Scientific Revolutions. The model represents scientific activity as a changing set of coupled institutions; a simulated ecology of interacting paradigms in which the creation of new theories is stochastic and endogenous. The model captures the sociological dynamics of paradigms as they compete against one another for members, solve puzzles, and recognize anomalies. We use sensitivity tests and regression to examine the role of intrinsic versus contextual factors in determining paradigm success. We find that situational factors attending the birth of a paradigm largely determine its probability of rising to dominance, while the intrinsic explanatory power of a paradigm is only weakly related to the likelihood of success. For those paradigms surviving the emergence phase, greater explanatory power is significantly related to longevity. However, the relationship between a paradigm's “strength” and the duration of normal science is also contingent on the competitive environment during the emergence phase. Analysis of the model shows the dynamics of competition and succession among paradigms to be conditioned by many positive feedback loops. These self-reinforcing processes amplify intrinsically unobservable microlevel perturbations in the environment—the local conditions of science, society, and self faced by the creators of a new theory—until they reach macroscopic significance. Such path dependent dynamics are the hallmark of self-organizing evolutionary systems. We consider the implications of these results for the rise and fall of new ideas in contexts outside the natural sciences such as management fads.
The Global Configuration of a Speculative Trading Operation: An Empirical Study of Foreign Exchange Trading
Authors: Mosakowski Elaine , Zaheer Srilata
Published: October 2008

This paper proposes a theory of firm boundaries based on fore-knowledge development and exploitation in speculative or “informed” trading. Foreign exchange trading provides this study's empirical context. From research on information economics, we suggest optimal speculative trading operations are multiunit and globally dispersed. Alternatively, transaction cost economics suggests atomistic actors prevail in the market for fungible commodities like currencies. We also develop competing hypotheses about information technology's effects on foreign exchange trading operations. Speculation arguments predict that the global scope of trading operations will expand after the introduction of generic information technologies. Transaction cost economics proposes that, when atomistic actors do not prevail, trading operations will contract after this introduction. We test competing predictions with models of the expansion, contraction, and net change in a firm's global dispersion. We estimate these models with data from the population of banks worldwide engaged in interbank foreign exchange currency (FX) trading from 1974 to 1993. Our results uncover two types of firms: those that approach the atomistic actor of transaction cost economics, and those that resemble the globally dispersed multiunit configuration from our speculation discussion. These results encourage reflection on how the theory of the firm differs when firms trade to produce versus speculate.
Strategic Flexibility in Information Technology Alliances: The Influence of Transaction Cost Economics and Social Exchange Theory
Authors: Young-Ybarra Candace , Wiersema Margarethe
Published: October 2008

Utilizing a model drawn from both transaction cost economics and social exchange theory, we analyze determinants of strategic flexibility in a sample of strategic alliances involved in joint development agreements or joint research pacts. Findings indicate that, in general, determinants suggested by transaction cost economics provided flexibility in modification and inflexibility in exit. From social exchange theory, trust was found to be positively related to both types of flexibility while another component of social exchange theory, dependence, was found to be negatively related to the strategic flexibility of the alliance. Results also found that factors suggested by both transaction cost economic theory and social exchange theory were related to the concept of trust. Economic constraints as suggested by transaction cost economics were positively related to trust between the alliance partners while dependence was negatively related to trust. Additionally, the quality of communication and the existence of shared values were positively related to trust between the exchange partners. Results provide support for the role of determinants from both transaction cost economics and social exchange theory in the flexibility of strategic alliances.
Erratum: Organizational Culture as a Complex System: Balance and Information in Models of Influence and Selection
Authors: Frank Kenneth A. , Fahrbach Kyle
Published: October 2008

The formatting of several of the equations appearing in this article made them difficult to interpret (Organization Science, Volume 10, Number 3, pp. 253–277 ). Following are reformatted versions of Equations (5), (6), and (8).
Prolegomena on Coevolution: A Framework for Research on Strategy and New Organizational Forms
Authors: Lewin Arie Y. , Volberda Henk W.
Published: October 2008

We advance arguments for why and how a coevolutionary perspective and framework of analysis can provide a new lens and new directions for research in strategic management and organization studies. We identify the distinguishing properties of coevolution in an attempt to define coevolutionary research from other evolutionary research in social sciences. We also outline and discuss the empirical challenges and requirements for undertaking research within coevolutionary inquiry systems. In particular we stress the relevance of specifying coevolutionary models for reframing the selection adaptation standoff when applied to research on organization change over time, in general, and specifically to the mutation and emergence of new organizational forms. Furthermore, a coevolutionary framework has the potential to bridge and reintegrate strategy and organization theory teaching and research within a holistic framework. In our view such a reintegration is the sine qua non for studying organizational change over time and parallels the world of management practice where organization adaptations and strategy are intertwined and interdependent processes.
Where Do New Organizational Forms Come From? Management Logics as a Source of Coevolution
Authors: Dijksterhuis Marjolijn S. , Van den Bosch Frans A. J. , Volberda Henk W.
Published: October 2008

Many scholars have described organization form as a management tool in the alignment of organization and environment. As the environment of many companies becomes more chaotic, the exploration of organization forms characterized by flexibility and adaptability has been intensifying. When reviewing existing literature on new organization forms, several gaps become apparent. These gaps can be traced back to the artificial separation between the macrolevel and the firm level of analysis and the prevalence of a static notion of form. To contribute to a more encompassing theory of new organization forms, a coevolutionary perspective is suggested. In this perspective, contextual variation of macrolevel management logics is proposed as a key mediator in the coevolution of organization and environment. At the firm level, the contextual variation of management logics is reflected in shared managerial schemas underlying strategic design actions. The resulting coevolutionary model shows how contextual applications of management logics may be a source of variation in new organization forms. On the basis of a literature review, three management logics, representing ideal types, are described: classical management logic, modern management logic, and postindustrial management logic. These logics are related to three levers of design actions which reflect fundamentally different interventions in form. Linking management logics to design levers results in a set of propositions to be tested in future empirical research.
Communication and Trust in Global Virtual Teams
Authors: Jarvenpaa Sirkka L. , Leidner Dorothy E.
Published: October 2008

This paper explores the challenges of creating and maintaining trust in a global virtual team whose members transcend time, space, and culture. The challenges are highlighted by integrating recent literature on work teams, computer-mediated communication groups, cross-cultural communication, and interpersonal and organizational trust. To explore these challenges empirically, we report on a series of descriptive case studies on global virtual teams whose members were separated by location and culture, were challenged by a common collaborative project, and for whom the only economically and practically viable communication medium was asynchronous and synchronous computer-mediated communication. The results suggest that global virtual teams may experience a form of “swift” trust, but such trust appears to be very fragile and temporal. The study raises a number of issues to be explored and debated by future research. Pragmatically, the study describes communication behaviors that might facilitate trust in global virtual teams.
Learning from Samples of One or Fewer
Authors: March James G. , Sproull Lee S. , Tamuz Michal
Published: October 2008

Organizations learn from experience. Sometimes, however, history is not generous with experience. We explore how organizations convert infrequent events into interpretations of history, and how they balance the need to achieve agreement on interpretations with the need to interpret history correctly. We ask what methods are used, what problems are involved, and what improvements might be made. Although the methods we observe are not guaranteed to lead to consistent agreement on interpretations, valid knowledge, improved organizational performance, or organizational survival, they provide possible insights into the possibilities for and problems of learning from fragments of history.
The Nontraditional Quality of Organizational Learning
Authors: Weick Karl E.
Published: October 2008

The traditional definition of learning as a shift in performance when the stimulus situation remains essentially the same implies a set of conditions that occur rarely in organizations. Thus, either organizational learning is an infrequent event, or it occurs frequently but takes a nontraditional form. Both possibilities are reviewed and implications for research strategy are suggested.
Organizational Learning and Communities-of-Practice: Toward a Unified View of Working, Learning, and Innovation
Authors: Brown John Seely , Duguid Paul
Published: October 2008

Recent ethnographic studies of workplace practices indicate that the ways people actually work usually differ fundamentally from the ways organizations describe that work in manuals, training programs, organizational charts, and job descriptions. Nevertheless, organizations tend to rely on the latter in their attempts to understand and improve work practice. We examine one such study. We then relate its conclusions to compatible investigations of learning and of innovation to argue that conventional descriptions of jobs mask not only the ways people work, but also significant learning and innovation generated in the informal communities-of-practice in which they work. By reassessing work, learning, and innovation in the context of actual communities and actual practices, we suggest that the connections between these three become apparent. With a unified view of working, learning, and innovating, it should be possible to reconceive of and redesign organizations to improve all three.
Organizational Learning Curves: A Method for Investigating Intra-Plant Transfer of Knowledge Acquired Through Learning by Doing
Authors: Epple Dennis , Argote Linda , Devadas Rukmini
Published: October 2008

This paper illustrates how a learning-curve model can be generalized to investigate potential explanations of organizational learning. The paper examines the hypothesis that knowledge acquired through by learning by doing is embodied in an organization's technology by analyzing the amount of transfer that occurs across shifts within a plant. If knowledge becomes completely embodied in technology, transfer across shifts should be complete since both shifts use the same technology. Methods that can be used for studying intra-plant transfer of knowledge are presented. The methods are illustrated by analyzing data from a plant that began production with one shift and then added a second shift several months into the production program. Three aspects of transfer are analyzed: (1) carry forward of knowledge when the plant makes the transition from one to two shifts, (2) transfer across shifts after both shifts are operating, and (3) transfer across time. Results indicate that substantial, but less than complete, transfer of knowledge occurred when the second shift was introduced. Once both shifts were operating, partial transfer across them occurred. Implications of the results for a theory of organizational learning and practical applications are discussed.
Organizational Learning: The Contributing Processes and the Literatures
Authors: Huber George P.
Published: October 2008

This paper differs from previous examinations of organizational learning in that it is broader in scope and more evaluative of the literatures. Four constructs related to organizational learning (knowledge acquisition, information distribution, information interpretation, and organizational memory) are articulated, and the literatures related to each are described and critiqued.

The literature on knowledge acquisition is voluminous and multi-faceted, and so the knowledge acquisition construct is portrayed here as consisting of five subconstructs or subprocesses: (1) drawing on knowledge available at the organization's birth, (2) learning from experience, (3) learning by observing other organizations, (4) grafting on to itself components that possess knowledge needed but not possessed by the organization, and (5) noticing or searching for information about the organization's environment and performance. Examination of the related literatures indicates that much has been learned about learning from experience, but also that there is a lack of cumulative work and a lack of integration of work from different research groups. Similarly, much has been learned about organizational search, but there is a lack of conceptual work, and there is a lack of both cumulative work and syntheses with which to create a more mature literature. Congenital learning, vicarious learning, and grafting are information acquisition subprocesses about which relatively little has been learned.

The literature concerning information distribution is rich and mature, but an aspect of information distribution that is central to an organization's benefitting from its learning, namely how units that possess information and units that need this information can find each other quickly and with a high likelihood, is unexplored. Information interpretation, as an organizational process, rather than an individual process, requires empirical work for further advancement. Organizational memory is much in need of systematic investigation, particularly by those whose special concerns are improving organizational learning and decision making.
Organizational Subcultures in a Soft Bureaucracy: Resistance Behind the Myth and Facade of an Official Culture
Authors: Jermier John M. , Slocum John W. , Fry Louis W. , Gaines Jeannie
Published: October 2008

The primary purpose of this study was to compare and contrast an organization's official culture and its subcultures. The proposition that soft bureaucracies project a rigid exterior appearance, symbolizing what key stakeholders expect, while masking a loosely-coupled set of interior practices, guided this analysis of a police organization. The official culture (crime-fighting command bureaucracy) was examined as an arbitrary set of symbols and meaning structures arranged according to top management preferences. Using qualitative and quantitative data, the organization's subcultures were profiled. It was demonstrated that top management was unable to impose organization-wide conformance with the official culture. There was close conformance to the official culture in only one of five distinct clusters of officers (“crime-fighting commandoes,” 21 percent of the sample). Officers in the other clusters (“crime-fighting street professionals,” “peace-keeping moral entrepreneurs,” “ass-covering legalists,” and “anti-military social workers”) substantially modified or rejected top management's dictates. They represented resistance subcultures, similar in their opposition to official culture, but unique in form. It was concluded that other organizations, not known for their monolithic image and solidarity, also encompass subcultures.
Intraorganizational Ecology of Strategy Making and Organizational Adaptation: Theory and Field Research
Authors: Burgelman Robert A.
Published: October 2008

This paper presents an intraorganizational ecological perspective on strategy making, and examines how internal selection may combine with external selection to explain organizational change and survival. The perspective serves to illuminate data from a field study of the evolution of Intel Corporation's corporate strategy. The data, in turn, are used to refine and deepen the conceptual framework. Relationships between induced and autonomous strategic processes and four modes of organizational adaptation are discussed. Apparent paradoxes associated with structural inertia and strategic reorientation arguments are elucidated and several new propositions derived. The paper proposes that consistently successful organizations are characterized by top managements who spend efforts on building the induced and autonomous strategic processes, as well as concerning themselves with the content of strategy; that such organizations simultaneously exercise induced and autonomous processes; and that successful reorientations in organizations are likely to have been preceded by internal experimentation and selection processes effected through the autonomous process.
Organizational Performance and Information Technology Investment Intensity in the Insurance Industry
Authors: Harris Sidney E. , Katz Joseph L.
Published: October 2008

In this paper, we consider whether there existed a significant and systematic relationship between firm performance and information technology investment intensity in the home office operation of 40 systems technology leaders in the life insurance industry, 1983–1986. It is hypothesized that in top performance insurance firms (1) information technology costs as a proportion of total operating costs were higher, and (2) information technology costs as a proportion of premium income were lower, than in weak performance firms. Evidence is presented that indicates that firm performance was linked to the level of information technology investment intensity.
Managerial Risk Taking in Diversified Firms: An Evolutionary Perspective
Authors: Hoskisson Robert E. , Hitt Michael A. , Hill Charles W. L.
Published: October 2008

The degree of risk taking by lower level (division) managers is expected to vary depending upon the extent and type of diversification. Limited diversification, when coupled with M-form adoption and decentralization, induces managerial risk taking. Notwithstanding, the control system elaborations (e.g., strategic business unit [SBU] structures) to facilitate information processing as firms increase diversification, extensively diversified firms reach limits such that control loss reduces managerial risk taking. Ultimately, this control loss may result in poor relative performance thereby triggering a threat of takeover. The threat of takeover creates incentives for restructuring and more focused diversification. Firms that reduce their diversified scope through restructuring may induce managerial risk taking. Thus, diversified firms experience periods that induce and other periods that reduce division manager risk taking depending on diversification and associated control system attributes.
Defining Voluntary Groups and Agencies Within Organization Science
Authors: Wilderom Celeste P. M. , Miner John B.
Published: October 2008

To regard voluntary organizations as unique manifestations of organizational behavior requires an accurate account of the nature of such work systems. This paper appraises existing definitions of the voluntary agency in the context of organization science and presents evidence for replacing the nonvoluntary/voluntary dichotomy with entrepreneurial, professional, and bureaucratic organizations, on the one hand, and two voluntary-organizational subtypes on the other: “voluntary groups,” in which volunteers operate as a socio-technical unit, and “voluntary agencies,” in which volunteers cooperate with paid personnel. Moreover, when paid staff is involved, some voluntary work contexts were found to take on characteristics of all three other organizational types to form a mixed pattern. Further tests of the relative distinctiveness of both subtypes vis-a-vis other organizational types and theories is proposed. The research yields certain guidelines for the design of true group-based organizational systems, thus extending knowledge in that area. It also provides an example of how research extending beyond the narrow confines of bureaucracy to the many other organizational forms known to exist might be conducted; such research is sorely needed to inform the practice of organizational design as a whole.
An Organizational Learning Model of Convergence and Reorientation
Authors: Lant Theresa K. , Mezias Stephen J.
Published: October 2008

A critical challenge facing organizations is the dilemma of maintaining the capabilities of both efficiency and flexibility. Recent evolutionary perspectives have suggested that patterns of organizational stability and change can be characterized as punctuated equilibria (Tushman and Romanelli 1985). This paper argues that a learning model of organizational change can account for a pattern of punctuated equilibria and uses a learning framework to model the tension between organizational stability and change. A simulation methodology is used to create a population of organizations whose activities are governed by a process of experiential learning. A set of propositions is examined that predict how patterns of organizational change are affected by environmental conditions, levels of ambiguity, organizational size, search rules, and organizational performance. Implications of this learning model of convergence and reorientation for theory and research are discussed.
Learning While Innovating
Authors: Van de Ven Andrew H. , Polley Douglas
Published: October 2008

This paper examines processes of trial-and-error learning during the development of a technological innovation by an interorganizational joint venture created expressly for developing and commercializing products from the new technology. We develop a model of adaptive learning, which incorporates elements from laboratory models of learning and applies them to the field research setting. The learning model focuses on relationships between the goals, actions, and outcomes of an innovation team within the joint venture as it develops the innovation over time, and the influences that environmental events and external interventions by resource controllers in parent companies have on the learning process. The model is tested based on a real-time longitudinal study of the development of a biomedical innovation (therapeutic apheresis) from 1983 to 1988. Different patterns of learning were observed in different periods of innovation development. Event time series analyses clearly contradict the learning model during an initial expansion period, but strongly support the model during a subsequent contraction period. Explanations for why these different patterns of organizational learning occurred over time are provided, and focus on a set of organizational structures and practices which are commonly used to manage innovation development, but which inhibit learning.
Advanced Manufacturing Technology and Organization Structure: Empowerment or Subordination?
Authors: Dean James W. , Yoon Se Joon , Susman Gerald I.
Published: October 2008

Advanced manufacturing technology (AMT) includes such technologies as computer-aided design (CAD) and manufacturing (CAM), as well as computer-integrated manufacturing (CIM). Numerous case studies have found that organization structure (e.g., centralization of decision making) changes when firms introduce AMT, but the findings from such studies have been inconsistent. This paper reports the findings of a large-sample study of the relationship between AMT and organization structure. Two alternative patterns in the relationship between these two concepts were considered. The Marxist perspective, which holds that automation is used by managers as a tool to subordinate the workforce, leads to predictions that AMT will be associated with increasing differentiation (more hierarchical levels and job classifications), centralized decision making, and high levels of formalization (management by rules). The Idealist perspective, which involves the belief that managers should use new technologies to empower the workforce, leads to predictions that AMT will be associated with less differentiation, decentralized decision making, and limited formalization. The study was conducted using questionnaires, which were returned by general managers from 185 firms in the metalworking industries (SIC codes 33-37). The findings provide some support for both perspectives, as AMT was associated with both decentralization of decision making and formalization. We interpret these results as stemming from the characteristics of AMT, particularly integration, flexibility, and risk. Seen in this light, organizations have less need to centralize decisions, as AMT's capacity for integration allows information to be brought together at lower levels of the firm, and its flexibility allows departments to more easily adapt to decisions made by other departments. The risk and expense associated with AMT, however, may lead firms to institutionalize those practices associated with effective use of the technology through formal rules. In other words, formalization may be a mechanism for safely decentralizing. In general, researchers are urged to strike a balance between focusing on the intentions of management and the constraints of the technology when they study technology and organization.
Communication and Motivational Predictors of the Dynamics of Organizational Innovation
Authors: Monge Peter R. , Cozzens Michael D. , Contractor Noshir S.
Published: October 2008

This paper reports on research designed to test a dynamic model of the causes of organizational innovation. Two communication variables (level of information and group communication) and three motivational variables (perceptions of equity, expectations of benefits, and perceived social pressure) were derived from equity theory, expectancy theory and the theory of reasoned action. These variables were used to predict the number of innovative ideas contributed by members of the organizations. Weekly data were collected for over a year from five firms and were analyzed with multivariate time series techniques. The results indicated that the communication variables were causes of organizational innovation but the motivational variables were not. Across the five firms, the variance explained by the model ranged from a low of 30 percent to a high of 78 percent. In four of the five firms, the forecast accuracy for the amount of individual innovation ranged from a low of 77 percent to a high of 85 percent.
Reputation, Learning, and Coordination in Distributed Decision-Making Contexts
Authors: Ching Chee , Holsapple Clyde W. , Whinston Andrew B.
Published: October 2008

From an organizational perspective, there are many decisions that are not strictly individual. A decision-making process may need to be distributed across multiple participants, each of whom contributes to the final decision by performing one or more tasks. A participant may be a person, a group, a team, or an artifact such as a computerized decision-support system. Computers are routinely used to support individual decision making. However, their potential for supporting distributed decision making is only beginning to be actualized. Further progress in exploring and realizing this potential can benefit greatly from a formal model that accounts for the diverse phenomena that can occur within a distributed decision maker.

When considering computer-based support for distributed decision making, the issue of coordinating the multiple participants becomes the central concern. Coordination defines the structural and dynamic patterns of inter-participant relationships in an organization. It has several aspects including planning, control, and review. Planning involves task decomposition, subtask allocation and synthesis. Control indicates mediation, negotiation and execution. And review deals with performance evaluation which will then contribute to organizational learning. Moreover, coordination occurs in a context of concurrent problem-solving tasks where multiple decisions are pending simultaneously. Bits and pieces of these coordination facets have been somewhat supported by existing computer technologies, such as decision-support systems and computer-mediated communication systems. However, systematic study of such support possibilities depends on formal models of distributed decision making as organizing paradigms.

In this paper, we present a model of distributed decision making that is particularly concerned with the ongoing coordination among participants in multiple simultaneously active decision processes. Basic outlines of the model are presented as an initial foundation for understanding the possibilities of computer-based support for distributed decision making. The model takes the view that an organization is dynamic in terms of its capacity for improved coordination over time and through experience. It accommodates a bidding perspective as the context for coordination. The use and adjustment of entity reputation offers a means for improved coordination over time, and for capturing the phenomenon of organizational learning.
Effectiveness of Organizational Responses to Technological Change in the Production Process
Authors: Tyre Marcie J. , Hauptman Oscar
Published: October 2008

This paper examines the effectiveness of organizational problem solving in response to technological change in the production process. First, the paper measures the degree of uncertainty associated with a given technological change by examining (1) the novelty of specific new features and functions, and (2) the required departure from established operating assumptions and organizational relationships. Second, the paper identifies three modes of problem solving that organizations use in dealing with technological change: modification prior to implementation (preparatory search), joint work with external technical experts during production start-up (joint search), and integration of engineering and manufacturing functions engaged in start-up (functional overlap). The effectiveness of these approaches is then tested on a sample of 48 new process introductions undertaken in eight plants by a leading global producer of precision metal components. Results indicate that the measured characteristics of technological change are significant predictors of the difficulties encountered in introducing new process technology. Findings also suggest that intensive problem solving efforts can significantly improve change outcomes, both shortening the period of disruption experienced and increasing the operating gains achieved. In addition, there was some evidence that the three organizational problem solving activities discussed here are not equally effective for responding to all types of process change. Specifically, the higher the level of technical novelty involved, the less useful was overlap between engineering and manufacturing functions. This challenges the general prescription that cross-functional team involvement in major technical projects always should be maximized, regardless of the nature of the change involved.
Demography and Design: Predictors of New Product Team Performance
Authors: Ancona Deborah Gladstein , Caldwell David F.
Published: October 2008

The increasing reliance on teams in organizations raises the question of how these teams should be formed. Should they be formed completely of engineers or should they include a range of specialists? Should they be made up to people who have long tenure in the organization, or those with a wide range of experience? As teams increasingly get called upon to do more complex tasks and to cross functional boundaries within the organization, conventional wisdom has suggested that teams be composed of more diverse members. This study suggests that the answer may not be so simple.

Using 409 individuals from 45 new product teams in five high-technology companies, this study investigates the impact of diversity on team performance. We found that functional and tenure diversity each has its own distinct effects. The greater the functional diversity, the more team members communicated outside the team's boundaries. This communication was with a variety of groups such as marketing, manufacturing, and top management. The more the external communication, the higher the managerial ratings of innovation.

Tenure diversity had its impact on internal group dynamics rather than external communications. Tenure diversity is associated with improved task work such as clarifying group goals and setting priorities. In turn, this clarity is associated with high team ratings of overall performance.

Yet diversity is not solely positive. While it does produce internal processes and external communications that facilitate performance, it also directly impedes performance. That is, overall the effect of diversity on performance is negative, even though some aspects of group work are enhanced. It may be that for these teams diversity brings more creativity to problem solving and product development, but it impedes implementation because there is less capability for teamwork than there is for homogeneous teams.

These research findings suggest that simply changing the structure of teams (i.e. combining representatives of diverse function and tenure) will not improve performance. The team must find a way to garner the positive process effects of diversity and to reduce the negative direct effects. At the team level, greater negotiation and conflict resolution skills may be necessary. At the organization level, the team may need to be protected from external political pressures and rewarded for team, rather than functional, outcomes.
Cooperative Versus Competitive Structures in Related and Unrelated Diversified Firms
Authors: Hill Charles W. L. , Hitt Michael A. , Hoskisson Robert E.
Published: October 2008

Herein we argue that different diversification strategies are associated with different sets of economic benefits. Firms that have diversified into related areas can realize benefits from economies of scope, while those that have diversified into unrelated areas can realize benefits from efficient internal governance mechanisms. We hypothesize that distinctly different internal organizational arrangements are required to realize these different benefits. Firms attempting to realize economies of scope need organizational arrangements that stress cooperation between business units. Firms attempting to realize economic benefits from efficient internal governance need organizational arrangements that stress competition between business units. If a diversified firm is to achieve high performance it must establish an appropriate fit between its diversification strategy on the one hand, and its organizational structure and control systems on the other. We test this thesis on 184 Fortune 1000 firms that participated in a survey of organizational arrangements. The results indicate that the appropriate fit between strategy, structure, and control systems is associated with superior performance. Firms attempting to realize economies of scope perform better if their organizational arrangements stress cooperation between business units, while firms attempting to realize economic benefits from efficient internal governance perform better if their organizational arrangements stress competition between business units.
Service Encounters as Rites of Integration: An Information Processing Model
Authors: Siehl Caren , Bowen David E. , Pearson Christine M.
Published: October 2008

We propose that service encounters (the interaction between customers and employees) can be conceptualized, and managed, as rites of integration. Rites of integration are defined as planned social interactions that have the objective of achieving “a temporary sense of closeness” between customers and service providers. We argue that such rites help to establish the appropriate level of psychological involvement or the appropriate degree of psychological closeness between the service provider and the customer. Psychological involvement facilitates (a) the sharing of information by customers and employees that is necessary for service production and (b) the favorable evaluation, by customers, of the service delivery process. We describe (and give examples of) different types of rites that result in varying levels of involvement. We conclude by offering propositions for the consequences associated with customers having their expectations of involvement confirmed or disconfirmed. These consequences include the importance of a “zone of indifference” around individual expectations of levels of involvement and the negative effects of too much closeness between the employee and customer.
Organizational Innovation and Substandard Performance: When is Necessity the Mother of Innovation?
Authors: Bolton Michele Kremen
Published: October 2008

This study extends earlier empirical research into organizational decline which has found that substandard performance stimulates innovation in a wide range of manufacturing industries. Using data from 74 U.S. high technology firms, this research investigates the relationship between organizational performance and adoption of an organizational innovation, the decision to join an R&D consortium. The central premise of the study is that a firm's propensity to innovate fluctuates with organizational performance, rather than stemming solely from a firm's inherent characteristics (such as size, structure, leadership, etc.).

The study found that substandard performance stimulated early joiners of R&D consortia. More risk-averse, high performing firms were found to be late adopters of R&D consortia. However, the relationship between performance and innovation was somewhat more complex than traditionally envisioned. First, a distinct institutionalization effect occurred as R&D consortia became a commonly accepted method of conducting certain types of R&D projects. While substandard performance was necessary to stimulate the early adopters, over time, institutionalization of R&D consortia occurred, risks associated with adoption were lowered, and later adopters were no longer stimulated solely by substandard performance. Second, an adoption decision was observed to involve more than a single, dichotomous organizational choice, but included both an initial adopt/nonadopt component and a related decision involving the timing of adoption (early/late). The relationship between organizational performance and innovation emerged only when the effects of the initial adoption decision (adopt/nonadopt) were separated from the effects of adoption timing (early/late).

The results here point rather strongly to the need to expand inquiry into the decision-making processes of late adopting firms, which are essentially “imitators,” to complement the existing prodigious literature on early adopting, firms, perceived in the traditional literature as “innovators.”
Organizational Design, Inertia and the Dynamics of Competitive Response
Authors: Gresov Christopher , Haveman Heather A. , Oliva Terence A.
Published: October 2008

Organizational design research has largely ignored the effects of inertia on competitive response, despite the centrality of the concept in theories of organizational evolution. In evolutionary research, inertia is frequently invoked as an explanation for why organizations delay or completely fail to respond to changes in competitive pressure. Inertia is thus seen as a primary antecedent of strategic consequences such as impaired performance and organizational mortality. Such explanations, however, cannot be tested empirically without a satisfactory method for measuring levels of inertia. This paper draws on techniques from catastrophe theory to explore a means of assessing organizational inertia by modelling organizational response to competitive pressure. Specifically, this paper looks at competitive response in terms of the aggressiveness of an organization's strategy, and models this as a function of environmental pressure and the inhibiting or enabling effects of organizational design. This paper also reveals a method for measuring the level of inertia associated with organizational response to environmental pressure. The proposed methodology takes into account the rich, multidimensional nature of these constructs and accounts for effects that delay response in the face of radical change in competitive pressure. The method also captures both incremental and radical shifts in competitive response intensity. Key benefits of the methodology include the ability to measure inertia and to assess the effects of different design elements on this measure. It thus provides a means by which researchers can enrich their understanding of the antecedents of inertia and test its effects on such outcomes as performance and survival. Data from a savings and loan association illustrate the application of this methodology.
A Social Information Processing Model of Employee Participation
Authors: Shetzer Larry
Published: October 2008

This paper explores employee participation from a social information processing perspective. The model draws upon social exchange theory, which depicts social interactions in terms of the relative influence of actors, and upon categorization theory, which considers how information relating to social interaction is cognitively organized and processed. While the social arena can be categorized along any number of dimensions, the core proposal of the model is that, in the interest of reducing the complexity of the organizational world, people employ a schema (i.e., cognitive map) in which social interactions are categorized according to the relative influence of actors. The schema for participation is posited to be an individual-level knowledge structure with a strong shared component. The consensual aspect of the participation schema varies across cultures and subcultures, accounting for the wide cross-cultural variation in attitudes, norms, and values about participation. The model further proposes that the participation schema resembles the structure of much other world knowledge in that it organizes social situations into increasingly abstract and inclusive categories. Finally, the participation schema is posited to link to both emotion or affective information, as well as to action-oriented knowledge. Schema-based processing reduces the cognitive complexity of a workplace interaction because it enables individuals to 1) efficiently determine their relative influence in a workplace situation; 2) respond efficiently to the situation on an emotional level; and 3) call upon scripted sequences of appropriate behavior. Implications of the model for research are proposed.