bluuebunny/crossref_metadata_2025 huggingface dataset:
Keiretsu, Governance, and Learning: Case Studies in Change from the Japanese Automotive Industry
Authors: Ahmadjian Christina L. , Lincoln James R.
Published: December 2003

The keiretsu structuring of assembler-supplier relations historically enabled Japanese auto assemblers to remain lean and flexible while enjoying a level of control over supply akin to that of vertical integration. Yet currently there is much talk of breakdowns in keiretsu networks. This paper examines some recent developments in Japanese parts-supply keiretsu.

We argue that keiretsu relationships are drifting from “hybrid” or “network” (i.e., keiretsu) governance modes toward the extremes of arms-length contracting and top-down administration. These changes are best understood through a combination of transaction cost and learning perspectives on alliance. Consistent with transaction-cost economics, the shift in purchase-supply relationships can be traced to changes in the nature of parts transactions and keiretsu-governance structures. A learning perspective on alliance complements and extends transaction-cost theory, providing additional explanation of the sources of change and the specific governance choices being made.

Our first two cases document a drift in Toyota's keiretsu supply network toward a hierarchical form in the management of parts-supply transactions. Toyota has effectively internalized its transactions with Daihatsu by taking a controlling interest. Toyota's strategy toward long-term partner Denso, on the other hand, was very different. Toyota built, from the ground up, an in-house capability in electronic components, thus scaling down its dependence on Denso. A third case considers a general trend in the Japanese auto industry toward greater standardization of parts. With the routinization of quality, reliability, and speed in supply management, the need for keiretsu-style governance has declined. The withering of keiretsu obligations is also traceable to globalization and the continuing weakness of the Japanese economy, which have prompted Japanese firms to question received business practice.
Appropriating Value from Computerized Reservation System Ownership in the Airline Industry
Authors: Duliba Katherine A. , Kauffman Robert J. , Lucas Henry C.
Published: December 2003

It is difficult for the firm competing through information technology resources to gain a sustainable advantage because systems are easy to imitate and substitute resources are often available to competitors. The innovator may be unable to appropriate all of the benefits from information technology investments. Airlines have installed computerized reservations systems in travel agencies to appropriate the returns from their investments in information technology. The airlines expected to obtain a number of benefits from this strategy, including increased efficiency, possible bias in favor of the computerized reservations systems owner on the part of the travel agent, and fees from other airlines for making reservations for them. The purpose of this paper is to evaluate the appropriation of value by computerized reservations systems owners from deploying systems in travel agencies. These benefits, beyond fees from travel agents, should be seen in the vendor airline's market share between cities and in the overall performance of the airline at an industry level. This paper models airline performance as a function of computerized reservations systems ownership at two levels: for selected city-pairs and at the overall level of the firm. The city-pair analysis employs a multinomial logit market share model that analyzes five years of data on 72 city-pair routes. The industry model uses longitudinal data for a panel of 10 airlines for 12 years. The results of both analyses support hypotheses that computerized reservations systems ownership is positively related to airline performance. It appears that strong airlines have appropriated the benefits of their computerized reservations systems, turning them into highly specialized assets for further travel-related innovation. This work offers useful theoretical extensions and methodological approaches for the study of similar kinds of network technology innovations that are currently being deployed in association with electronic commerce on the Internet.
Replication as Strategy
Authors: Winter Sidney G. , Szulanski Gabriel
Published: December 2003

Replication, a familiar phenomenon sometimes referred to as the “McDonalds approach,” entails the creation and operation of a large number of similar outlets that deliver a product or perform a service. Companies pursuing this strategy are now active in over 60 industries. Although replicators are becoming one of the dominant organizational forms of our time, they have been neglected by scholars interested in organizations. As a result of this neglect, replication is typically conceptualized as little more than the exploitation of a simple business formula. Such a view clouds the strategic subtlety of replication by sidestepping the exploration efforts to uncover and develop the best business model as well as the ongoing assessment that precedes large-scale replication of it. Empirical evidence supports an alternative view of replication strategy as a process that involves a regime of exploration in which the business model is created and refined, followed by a phase of exploitation in which the business model is stabilized and leveraged through large-scale replication.

In this paper we present the key elements of a theory of replication strategy. We discuss key aspects of a replication strategy, namely the broad scope of knowledge transfer and the role of the central organization, and the analytical concepts of template and Arrow core as a preamble for specifying hypotheses about the conditions under which a replication strategy is more likely to succeed in a competitive setting. Replication strategy provides unusually transparent examples of the process of leveraging knowledge assets; we exploit this in our concluding discussion.
Capabilities as Real Options
Authors: Kogut Bruce , Kulatilaka Nalin
Published: December 2003

Strategy research consists of a balance between positive and normative theory. Normative theories suggest particular heuristics, or cognitive representations, to find appropriate solutions. Heuristics permit faster solutions to real-time problems; they also suffer from the potential of negative transfer to inappropriate applications.

The theory of real options provides the appropriate heuristic framing of competencies and exploratory search. A real options approach marries the theory of financial options to foundational ideas in strategy, organizational theory, and complex systems. We join these approaches to identify three pairs of concepts: scarce factor and the underlying asset in option theory, inertia and irreversibility, and the ruggedness of landscape and option values. Strategic theories of resources largely define a core competence as unique and nonimmutable. In doing so, this definition has wrongly forgotten Barney's initial insight into scarce factor markets as determining the valuation of a competitive asset. Financial theory of real options derives its heuristics of investing in exploratory search by inferring future value of today's investments from market prices.

We apply the three conceptual pairs to the evaluation of capabilities as real options through a formal descriptive model. The valuation of core capabilities is derived from observing the price dynamics of correlated strategic factors in the market. Because of inertia, managers cannot easily adjust the wrong set of organizational capabilities to the emergence of market opportunities. However, firms that have made investments in capabilities appropriate to these opportunities are able to respond. From this description, we define core competence as the choice of capabilities that permits the firm to make the best response to market opportunities. The heuristic framing of capabilities as real options guides the normative evaluation of the balance between exploitation and exploration.
Managing Exceptionally
Authors: Mintzberg Henry
Published: December 2003

This paper is about two managers of Red Cross refugee camps in Tanzania who manage by exception in rather exceptional circumstances. Using a model of managerial work that delineates roles carried out at the information, people, and action levels, inside and outside the unit, these managers' activities concentrate especially on communicating and controlling a chaotic situation in a steady state, at least temporarily. While many other managers appear to be moving away from conventional forms of managing—to more linking instead of leading and convincing instead of controlling, etc.—here are two managers who seem to be going the other way, precisely because their situation is so unconventionally risky. Ned Bowman's great contribution has been not just about risks and options per se, but in the risks that he himself took and the options that he himself exposed. In this spirit, the paper concludes with a plea for the opening up not simply of content, but of context.
Adapting to Radical Change: Strategy and Environment in Piece-Rate Adoption During China's Transition
Authors: Keister Lisa A.
Published: December 2003

Adaptation to radical change is central to research in organization theory, and some of the most dramatic examples of environmental change have occurred recently in transition economies such as China. I take advantage of change during China's economic reform to study the relative importance of organizational and environmental factors in producing innovative managerial response. I find that strategic choice predicted innovation in the early stages of reform, but environmental factors increased in salience over time. Intrafirm support, Communist Party connections, and a market orientation produced innovation early in reform. Simple imitation of others was also salient in early years. As reform progressed, managers increasingly imitated other profitable firms and drew on their own experience. My results inform an understanding of both the process by which innovation occurs and firm behavior in transition economies.
Clothes Make the Person? The Tailoring of Legitimating Accounts and the Social Construction of Identity
Authors: Creed W. E. Douglas , Scully Maureen A. , Austin John R.
Published: December 2003

We empirically explore the legitimating accounts for and against policies precluding workplace discrimination against gay, lesbian, bisexual, and transgender people, focusing on how agents working at both the national level and within organizations use broader cultural accounts in building their legitimating accounts in local settings. The diffusion perspective in institutional theory has portrayed how agents import “ready-to-wear” cultural accounts. In contrast, translation theory depicts how agents interpret and adapt cultural accounts as they fashion them into legitimating accounts for a local setting. An alternative would theorize accounts that are neither strictly borrowed nor idiosyncratically tailored. We advanced a third perspective, drawing on frame analysis as it is used in social movement theory. Framing theory attends to both the importance of cultural building blocks and the embedded ways in which agents relate to and shape systems of meaning and mobilize collective action to change social arrangements. We find that legitimating accounts are intertwined with the construction of social identities, which serve to legitimate, on the one hand, an account maker's participation in the discourse and set of claims, and on the other hand, the involvement of proponents and crucial audiences. We suggest that the mobilizing potential of legitimating accounts rests in part on their messages becoming “autocommunicational,” so that listeners identify themselves with the message.
When Talk Is Not Cheap: Substantive Penance and Expressions of Intent in Rebuilding Cooperation
Authors: Bottom William P. , Gibson Kevin , Daniels Steven E. , Murnighan J. Keith
Published: December 2003

Interpersonal relationships can be fragile. The mere perception of opportunistic behavior can lead to a breakdown in cooperation. Once damaged, the question then arises as to whether and how cooperation might be restored. Noncooperative game theory raises serious doubts about the possibilities, although interactional justice and impression management research have shown that verbal explanations can dampen reactions to aversive behavior. Philosophical, anthropological, and ethological research all suggest that genuine forgiveness may require something more tangible and substantive than an explanation. Thus, the current experiment investigated the effects of explanations and varying forms of substantive amends on the restoration of mutual cooperation. The results confirm that rebuilding cooperation is feasible. Apologies and simple explanations can be effective to a degree, though substantive amends have significantly more positive effects than explanations alone. In contrast to prior findings on interactional justice, acknowledgments were more effective than denials in repairing short interactions. This research demonstrates that, once breached, cooperation can be reestablished and that actions as well as explanations and apologies can augment the process in important and sometimes subtle ways.
A Process Model of Capability Development: Lessons from the Electronic Commerce Strategy at Bolsa de Valores de Guayaquil
Authors: Montealegre Ramiro
Published: December 2003

Past literature using the resource-based view of the firm has concentrated on attributes of firms' capabilities and on strategies for exploiting existing firm-specific assets. Comparatively little research has been conducted on how a firm develops, manages, and deploys capabilities to support its business strategy. This study seeks to understand the process of capability development and to establish a model that has both theoretical and practical significance. A longitudinal case study of the electronic commerce strategy formation and implementation at Bolsa de Valores de Guayaquil, an Ecuadorian stock exchange, yielded qualitative data that allowed inductive modeling of the capability development process. The model reveals that capability development in support of a new strategy is a gradual process that is cumulative, expansive, and very dependent on the way that difficult-to-imitate resources and actions are combined. At Bolsa de Valores de Guayaquil, actions that supported the development of the firm's capability to strategize seem to have contributed the most in the initial phase of the strategy formation and implementation; actions that helped the development of the firm's capability to be flexible appear to have contributed the most during the middle phase; and actions that supported the development of the firm's capabilities to integrate and engender trust seem to have contributed the most in the final phase. In addition, the key resources that supported the overall capabilities development process included leadership, organizational culture, information technology, long-term view, and social networks. Implications of this model for both research and practice are discussed.
Time to Change: Temporal Shifts as Enablers of Organizational Change
Authors: Staudenmayer Nancy , Tyre Marcie , Perlow Leslie
Published: December 2003

In this paper, we integrate findings from three field studies of technology intensive organizations to explore the process through which change occurred. In each case, problems were well recognized but had become entrenched and had failed to generate change. Across the three sites, organizational change occurred only after some event altered the accustomed daily rhythms of work, and thus changed the way people experienced time. This finding suggests that temporal shifts—changes in a collective's experience of time—can help to facilitate organizational change. Specifically, we suggest that temporal shifts enable change in four ways: (1) by creating a trigger for change, (2) by providing resources needed for change, (3) by acting as a coordinating mechanism, and (4) by serving as a credible symbol of the need to change.
The Use of Rewards to Increase and Decrease Trust: Mediating Processes and Differential Effects
Authors: Ferrin Donald L. , Dirks Kurt T.
Published: December 2003

We test hypotheses asserting that reward structures—an omnipresent element of the work context—have a strong influence on interpersonal trust, and we explore the cognitive and behavioral routes through which the effects may occur. Specifically, we use attribution theory to identify several core processes including social perception (causal schemas), self-perception, and attributional biases (correspondence bias, suspicion effects, and preexisting expectations) that may explain trust development. A 3 (cooperative/competitive/mixed rewards) X 2 (high/low initial trust) experimental design in a problem-solving task was used to examine the hypotheses. The results suggest that reward structures have a strong influence on trust, and that the effect is mediated by causal schemas, suspicion effects, and self-perception. We also found some support for the prediction that the impact of mixed reward structures on trust is biased by individuals' preexisting expectations about their partner's trustworthiness. The theory and results suggest that attribution theory provides a useful framework for understanding the complex, diverse, and multiple routes through which trust may develop.
Trust Transfer on the World Wide Web
Authors: Stewart Katherine J.
Published: December 2003

The World Wide Web (WWW) has been touted as providing great opportunities for small businesses to compete and thrive. Concerns about trust have been identified as a barrier to such businesses' success. This research explores how consumers' initial trust judgments about organizations they encounter on the Web may be influenced by hypertext links from trusted websites and associations with the more trust-inducing traditional retail channel. This paper develops and tests a cognitive model of the trust transfer process, arguing that trust is transferred across hypertext links based on the perceived interaction and similarity of the linked organizations, and that institution-based trust is transferred from the traditional shopping channel to a Web-based organization based on evidence that the Web-based organization has a physical store. An experimental study shows that a hypertext link from one website to another increased the extent to which the linked organizations were perceived to have a business relationship and be similar, and these perceptions had a positive influence on trusting beliefs regarding the linked site. Associating with the physical shopping channel by showing a picture of a building on a website increased the extent to which subjects reported intention to buy from the site. The study provided empirical evidence that trusting beliefs regarding the website had a significant positive effect on intention to buy from it. This paper discusses further development of the trust transfer model based on the social perception literature and explores implications for future research.
Contextual Confidence and Active Trust Development in the Chinese Business Environment
Authors: Child John , Möllering Guido
Published: December 2003

This paper contributes to the conceptual and empirical understanding of organizational trust. It confirms the importance of “contextual confidence” in institutions for building trust. Moreover, it extends models of trust production to include the effects of purposive action by the truster over and above the contextual prediction of trust emphasized in previous research. Accordingly, “active trust development” is conceptualized as a strategy to strengthen the basis for trust. Empirical evidence is drawn from a survey of 615 Hong Kong firms that manage operations in mainland China.

Confidence in China's institutional context was found to have a strong positive association with trust in the local staff working within that context. Active trust development was validated as a means of enhancing trust, though its effect on trust was not as strong as that of perceived institutional effectiveness.

Active trust development initiatives are particularly valuable in an environment such as contemporary China, where the institutional foundations for trust remain underdeveloped. The positive correlation of trust with organizational performance provides an incentive for managers to explore these initiatives. At the same time, government and other bodies in China and elsewhere, which are in a position to create and promote effective institutions, are encouraged to intensify their efforts in that direction.
Levels of Organizational Trust in Individualist Versus Collectivist Societies: A Seven-Nation Study
Authors: Huff Lenard , Kelley Lane
Published: December 2003

Competitiveness in global industries increasingly requires the ability to develop trusting relationships. This requires organizations, and the individuals they are comprised of, to be both trustworthy and trusting. An important question is whether societal culture influences the tendency of individuals and organizations to trust. Based largely on Yamagishi's (1994, 1998a, b) theories explaining trust, commitment, and in-group bias in collectivist cultures, this study examines potential differences in levels of trust between individualist and collectivist cultures. Survey data was collected from 1,282 mid-level managers from large banks in Japan, Korea, Hong Kong, Taiwan, China, Malaysia, and the United States. We first study differences in how individuals from individualist and collectivist societies trust ingroups versus out-groups. This provides an important foundation for hypotheses regarding differences in individual propensities to trust and two measures of organizational trust: internal trust (trust within the organization) and external trust (an organization's trust for suppliers, customers, etc.). Findings show higher levels of propensity to trust and organizational external trust in the United States than in Asia.
The Dynamics of Innovative Activity and Competitive Advantage: The Case of Australian Retail Banking, 1981 to 1995
Authors: Roberts Peter W. , Amit Raphael
Published: December 2003

This study examines the adoption of new products and processes in the Australian retail banking industry over the 1981 to 1995 period. Our analysis demonstrates that the vast majority of observed innovative activity was based on ideas sourced from outside the focal firm, and that innovations diffused very quickly across competing banks. As such, there were no periods during which any bank had proprietary possession of a major product or process innovation. We therefore ask how the banks' innovative activity could affect their relative financial performance positions. We answer this question by developing a set of hypotheses that relate specific features of their histories of innovative activity to their current financial performance. These hypotheses are tested using a detailed data set describing 1,297 modifications made to products and services, distribution technologies, and back-office processes within a sample of Australian retail banks over the sample period. Our results provide support for the general position that establishing an attractive competitive position depends on the specific history of a firm's innovative activity. Banks that undertook more innovative activity, that were more consistent in that activity, and whose composition of activity was somewhat differentiated from the industry norm tended to display superior financial performance. Rather than looking solely for internally generated, inimitable innovations to deliver competitive advantage, these results suggest that active and consistent innovative activity that is somewhat differentiated from competitors can also deliver superior financial performance.
Racial Homophily and Its Persistence in Newcomers' Social Networks
Authors: Mollica Kelly A. , Gray Barbara , Treviño Linda K.
Published: December 2003

This study examined the formation and persistence of homophilous, or same-race, friendship ties among racial minorities and whites in a “newcomer” setting. Homophilous ties provide valuable sources of mutual support but may limit racial minorities' access to resources and information in organizations. Study participants were first-year MBA students who entered a program at the same time. We measured network ties at two times: six weeks after the beginning of the students' first semester in the program, and at the beginning of the following semester 3 1/2 months after the second survey. We also administered a separate survey measuring social identity salience prior to the first network survey.

Despite the fact that there were fewer same-race ties for racial minorities to choose from, their friendship networks demonstrated greater homophily than those of whites early in the formation of the network and over time. Also, African-Americans were more likely than whites to seek out homophilous friendship ties in other class sections. Race as a salient social identity group membership was positively related to homophily for African-Americans, Hispanics, and whites. Over the time period studied there was no significant change in homophily among the racial groups' networks, despite the explicit promotion of diversity in recruitment of students, formation of heterogeneous classes and teams, and active support by the MBA program administrators. We discuss the practical implications of our findings for organizations that are attempting to increase cultural diversity and promote active interaction among individuals from different racial and ethnic backgrounds.
Founder-CEO Succession and the Paradox of Entrepreneurial Success
Authors: Wasserman Noam
Published: December 2003

In the last few decades, we have developed a substantial body of knowledge about CEO succession. However, except for some studies of family businesses that lack direct applicability to nonfamily CEO succession, the past studies of succession have not examined the very first succession event in a firm, when the Founder-CEO is replaced, on a large-scale basis. The critical differences between later-stage succession and Founder-CEO succession include the higher level of attachment between Founder-CEOs and the firms they create, the much larger equity holdings of Founder-CEOs (which give them much more control of the firm), the fact that many Founder-CEOs remain in the firm (even though it is being run by their successors), and the fact that nearly all early-stage succession events involve outside successors (in contrast to later-stage succession research, which has focused on the insider-outsider distinction). These differences make it hard to extrapolate from later-stage succession findings to Founder-CEO succession. Therefore, in order to examine Founder-CEO succession, I used field research and grounded theory building to study the factors that should affect Founder-CEO succession in Internet start-ups. I find that there are two central intertemporal events that may affect Founder-CEO succession: The completion of product development and the raising of each round of financing from outside investors. I develop testable hypotheses about how each of these events affect the rate of succession, and then test these hypotheses using an event-history analysis of a unique dataset containing the succession histories of 202 Internet firms. My findings point to multiple “paradoxes of success” in which the Founder-CEO's success at achieving critical milestones actually causes the chance of Founder-CEO succession to rise dramatically.
Knowledge Retention and Personnel Mobility: The Nondisruptive Effects of Inflows of Experience
Authors: Madsen Tammy L. , Mosakowski Elaine , Zaheer Srilata
Published: December 2003

Firms often bring in personnel from rivals to gain tacit knowledge and skills. Personnel new to a firm may broaden the firm's knowledge stock, but may not disrupt the firm's ways of organizing. Instead, personnel inflows may contribute to the retention of a firm's traditional ways of organizing. This study tracks the flow of personnel within and across organizational boundaries (intrafirm and interfirm flows) and geographic boundaries (local and cross-border flows) for multiunit banks operating in the Foreign Exchange Trade Industry from 1973–1993. We test how a firm's retention activity responds to inflows of personnel from different sources (e.g., intrafirm, interfirm, local, and cross-border). The findings show that inflows of personnel from different sources increase a firm's retention activity. Rather than adopting changes in behavior in response to an influx of personnel from within or across spatial boundaries, firms in the foreign exchange industry tend to retain their existing ways of organizing. Personnel inflows from a combination of sources, such as local intrafirm, cross-border intrafirm, local interfirm, and cross-border interfirm, also positively affect retention. By examining the differences in the magnitudes of these effects, we empirically show that considering different sources of personnel inflows in combination is worthwhile.
On the Strategic Accumulation of Intangible Assets
Authors: Knott Anne Marie , Bryce David J. , Posen Hart E.
Published: December 2003

The resource-based view holds that firms can earn supranormal returns if and only if they have superior resources and those resources are protected by some form of isolating mechanism preventing their diffusion throughout industry. One isolating mechanism that has been proposed for intangible assets is their accumulation process. The hypothesis is that intangible assets are inherently inimitable because would-be imitators need to replicate the entire accumulation path to achieve the same resource position. Thus, entrants can never catch up to incumbents.

An interesting challenge to this hypothesis is counterfactual evidence that entrants sometimes outperform incumbents. Such counterfactual evidence should not exist if the theory is strictly correct. This paper attempts to reconcile resource accumulation theory with the counterfactual evidence. We do so by building an intermediate good-production function for a firm's intangible asset stocks. We test the contribution of the intangible asset stock to the firm's final good-production function and examine the extent to which that asset stock deters rival mobility in the pharmaceutical industry.

We find that the asset accumulation process itself cannot deter rivals, because asset stocks reach steady state rather quickly. Entrants can achieve an incumbent's intangible asset stock merely by matching its investment until steady state. Thus, we conclude that the accumulation process per se is not an isolating mechanism. While this is perhaps the most important contribution, another contribution is an empirical methodology for characterizing the accumulation function.
Open Source Software and the “Private-Collective” Innovation Model: Issues for Organization Science
Authors: Hippel Eric von , Krogh Georg von
Published: December 2003

Currently, two models of innovation are prevalent in organization science. The “private investment” model assumes returns to the innovator result from private goods and efficient regimes of intellectual property protection. The “collective action” model assumes that under conditions of market failure, innovators collaborate in order to produce a public good. The phenomenon of open source software development shows that users program to solve their own as well as shared technical problems, and freely reveal their innovations without appropriating private returns from selling the software. In this paper, we propose that open source software development is an exemplar of a compound “private-collective” model of innovation that contains elements of both the private investment and the collective action models and can offer society the “best of both worlds” under many conditions. We describe a new set of research questions this model raises for scholars in organization science. We offer some details regarding the types of data available for open source projects in order to ease access for researchers who are unfamiliar with these, and also offer some advice on conducting empirical studies on open source software development processes.
Re-Embedding Situatedness: The Importance of Power Relations in Learning Theory
Authors: Contu Alessia , Willmott Hugh
Published: December 2003

This paper critically addresses the coherence, reception, and dissemination of “situated learning theory” (Lave and Wenger 1991). Situated learning theory commends a conceptualization of the process of learning that, in offering an alternative to cognitive theories, departs radically from the received body of knowledge on learning in organizations. The paper shows how elements of situated learning theory have been selectively adopted to fertilize or extend the established terrain of organizational learning. In this process, we argue, Lave and Wenger's embryonic appreciation of power relations as media of learning is displaced by a managerial preoccupation with harnessing (reified) “communities of practice” to the fulfillment of (reified) corporate objectives. We illustrate our argument by reference to Orr's (1990, 1996) study of photocopier technicians, which is very widely cited as an example of the “new,” situated conceptualization of learning in communities of practice. We commend a revitalization of situated learning theory in which learning practices are understood to be enabled and constrained by their embeddedness in relations of power; and, more specifically, by the unstable institutionalization of power relations within capitalist work organizations.
Tacitness, Learning, and International Expansion: A Study of Foreign Direct Investment in a Knowledge-Intensive Industry
Authors: Martin Xavier , Salomon Robert
Published: December 2003

This paper examines the impact of knowledge tacitness on a firm's propensity to establish plants in foreign rather than domestic locations. Our predictions build on knowledge-based, internalization, and evolutionary theories of foreign direct investment. We argue that the tacitness of technology has an inverted-U effect on the propensity to undertake foreign investment. We also expect that as a firm learns about a technology, it will become more likely to make foreign investments. We examine two forms of learning: that which accumulates as a function of the number of plants previously built by the firm (transfer-based learning), and that which accumulates as a function of time since the firm started using a technology (time-based learning). We investigate empirical effects in a sample of investments in the memory segment of the semiconductor industry. Our predictions about the curvilinear effect of tacitness are supported. The results also suggest that learning is a matter of taking time to become acquainted with the use of the technology, and of gaining experience through successive foreign plant investments. The study adds to the understanding of the effects of knowledge on corporate expansion.
Preferential Mistreatment: How Victim Status Moderates the Relationship Between Organizational Citizenship Behavior and Workplace Victimization
Authors: Aquino Karl , Bommer William H.
Published: December 2003

This study investigates whether the performance of organizational citizenship behavior and three indicators of social status—hierarchical position, gender, and race—predict employees' vulnerability to being victimized by the harmful actions of others. We hypothesize that interpersonally directed organizational citizenship deflects mistreatment by others because it enhances social attractiveness and creates bonds of mutual obligation and reciprocity. However, drawing from prior research that shows that people with high social status are perceived more favorably than people with low status, we also hypothesize that benefits of organizational citizenship are more likely to accrue to employees in high, as compared to low, status groups. Data were from 448 employees of a U.S. manufacturing firm. As expected, citizenship was more strongly and negatively related to perceived victimization for whites as compared to African-Americans. However, contrary to our prediction, citizenship was more strongly related to perceived victimization among employees with low, as compared to high, hierarchical status. No moderating effect of gender was found. Implications for organizations are discussed and future research directions are offered.
External Solutions and Internal Problems: The Effects of Employment Externalization on Internal Workers' Attitudes
Authors: George Elizabeth
Published: December 2003

This study examines whether employment externalization, or the use of temporary and contract workers in organizations, is associated with weak psychological bonds between the internal workforce and organization. Specifically, the extent and length of such externalization would negatively relate to internal workers' trust in, commitment toward, and psychological contract with organizations. The premise for this argument is that internal workers may view externalization as an indicator of the organization's low-level commitment to them. Internal workers would reciprocate by decreasing their attachment to the organization. Externalization might also be seen as violating the psychological contract between employees and employers, since externalization is associated with slowed upward mobility and poor work support for internal workers. However, organizational actions that indicate commitment toward employees would mitigate such negative effects. I posit that externalization would be viewed less negatively both by workers who believe they have secure jobs, and by those who supervise and train others. These hypotheses were tested with data collected from 256 internal workers in three organizations. Results indicate that both the extent and length of externalization are negatively related to internal workers' attitudes, especially for those of internal workers with fewer supervisory responsibilities. However, contrary to the hypotheses, the relationship is also more negative for internal workers with high job security.
Bringing Managers into Theories of Multimarket Competition: CEOs and the Determinants of Market Entry
Authors: Stephan John , Murmann Johann Peter , Boeker Warren , Goodstein Jerry
Published: December 2003

Multimarket (or multipoint) contact has been shown to deter aggressive actions by rivals toward each other, producing a situation of mutual forbearance among firms. To create this deterrent capability, however, firms must enter each others' markets, which is just the kind of action that the deterrent is supposed to limit. This study explores the questions: Under what conditions are firms likely to behave aggressively toward their multimarket rivals by entering their markets and when will they engage in mutual forbearance? We describe how the effect of multimarket contact on the market-entry moves of a firm changes as the level of contact a firm has with its rivals increases. We draw on competitive intelligence and decision-making theory to argue that the competitive advantages associated with multimarket contact are supplemented by the fact that a firm's multimarket competitors serve as a readily available model to reduce the uncertainty associated with market-entry decisions. We hypothesize that these factors lead firms to prefer, up to the point where forbearance concerns become paramount, to enter the markets in which their multipoint rivals already compete. We also argue that once multimarket contact levels reach the point where forbearance begins to operate, these levels also serve to stabilize the structure through better competitive intelligence, with the result that the propensity of a firm to enter into additional markets of its multimarket rivals declines. We then extend multimarket theory by focusing on the role of the CEO. Specifically, we argue that newer and longer-tenured CEOs are likely to face different influences on their preferences for particular competitive actions. We test hypotheses that link the likelihood that CEOs will abide by the mutual interdependencies that their firm's multimarket ties represent to their tenure in the CEO position. Our findings produce support for an inverted-U-shaped relationship between multipoint contact and market entry. We also find evidence that longer-tenured CEOs are guided by their firm's multimarket relationships. Newer CEOs, however, do not seem to adopt a forbearance approach toward their firm's multimarket competitors.

Our findings have important implications for multimarket theory. This study is among the first to examine the role of managers within a multimarket context. We show that it is not enough for a firm to be embedded within a multimarket structure, but that for a firm to benefit from its multimarket position, its managers must be aware of this positioning and free of other influences that could cause them to behave in ways that are inconsistent with it. Because our findings show that newer CEOs can direct their firms to act in ways that are inconsistent with their firm's multimarket position, we identify an area of potential competitive vulnerability for the firm.
Pathways of Relevance: Exploring Inflows of Knowledge into Subunits of Multinational Corporations
Authors: Schulz Martin
Published: December 2003

To understand what determines knowledge flows into organizational subunits, the study reported here examines the relevance of the knowledge to the operations performed at the receiving subunit. This study analyzes inflows of knowledge from peers and supervising units into subunits of multinational corporations. It examines factors that affect the relevance of extra-unit knowledge to receiving subunits and explores empirically how these factors affect knowledge flows. The results show that knowledge travels along established ties from large knowledge bases into unspecialized, codified, locally responsive knowledge bases. The results are consistent with the view that relevance provides pathways through which new knowledge connects to prior knowledge.
Learning About Failure: Bankruptcy, Firm Age, and the Resource-Based View
Authors: Thornhill Stewart , Amit Raphael
Published: December 2003

Systematic differences in the determinants of firm failure between firms that fail early in their life and those that fail after having successfully negotiated the early liabilities of newness and adolescence are identified. Analysis of data from 339 Canadian corporate bankruptcies suggests that failure among younger firms may be attributable to deficiencies in managerial knowledge and financial management abilities. Failure among older firms, on the other hand, may be attributable to an inability to adapt to environmental change.
Constructing the Olympic Dream: A Future Perfect Strategy of Project Management
Authors: Pitsis Tyrone S. , Clegg Stewart R. , Marosszeky Marton , Rura-Polley Thekla
Published: December 2003

In this paper we investigate a uniquely complex organizational context—that of the fast-tracked large-scale project management of a significant piece of Sydney 2000 Olympic infrastructure, which we researched in terms of its management through the “future perfect.” In a grounded analysis we resolved to track how the future perfect developed in the life of one large, complex project whose uniqueness meant that it was unable to be strategically planned in advance. We tracked the use of what we term “future perfect strategy” through analysis of data collected both in leadership meetings of the directing agency, “PALT”—Project Alliance Leadership Team—as well as in individual interviews that we conducted in and around the project, and through analysis of media coverage. Overall, the project was a success, but some problems arose along the way to completion. Largely, these were focused on issues of social rather than technical construction—something even the most strategic of plans cannot account for. As well as identifying some of the specific mechanisms for encouraging future perfect strategy that were used in the project, including encouraging “strange conversations,” “playing end games,” “workshopping,” and “projecting feelings, concerns and issues,” we also suggest some ways that the social construction issues might be handled in the future.
Entrance Capacity of an Automated Highway System
Authors: Hall Randolph W. , Nowroozi Ali , Tsao Jacob
Published: December 2003

This paper evaluates the entrance capacity and queueing delay for Automated Highway Systems through use of simulations and analytical modeling. Queueing statistics are also used to determine the sustainable capacity of alternative concepts, taking trip length distribution and spacing between ramps into consideration. Based on safety-spacing headways (produced in a separate analysis), the most promising concept utilizes platoons both on the highway and on on-ramps. However, it is unclear whether comparable capacity can be achieved on exit, when vehicles must be decoupled from their platoons, and whether it is safe for vehicles to enter the highway in closely spaced platoons. The analytical evaluation indicates that entrance/exit spacing on the order of one per 2 km or closer would be required to support highways with total capacity on the order of 20,000 vehicles per hour. Most likely, this would be achieved most efficiently if separate dedicated entrances are provided for automated vehicles, to minimize weaving on manual lanes.
Sensitivity Analysis for Stochastic User Equilibrium Network Flows—A Dual Approach
Authors: Ying Jiang Qian , Miyagi Toshihiko
Published: December 2003

Recently, extensive studies have been conducted on the computational methods of sensitivity analysis for the Wardropian equilibrium modeling of traffic networks and their applications. But the same problems in the context of the stochastic user equilibrium modeling seem not to have been addressed. In this paper, we present a method for sensitivity analysis for network flows at stochastic user equilibrium. Our method is developed from a dual formulation of the stochastic user equilibrium analysis. By adopting Dial's algorithm for stochastic traffic assignment, we are able to formulate a computationally efficient link-based algorithm for the sensitivity analysis. Since the Wardropian equilibrium in a traffic network is an extreme case of stochastic user equilibrium with θ → ∞, θ being a dispersion parameter in the expected utility function for stochastic route choice, the method presented here can also be used for sensitivity analysis of the Wardropian equilibrium by setting θ large enough.
An Analytic Stochastic Model for the Transit Vehicle Holding Problem
Authors: Hickman Mark D.
Published: December 2003

This paper describes an analytic model that determines the optimal vehicle holding time at a control stop along a transit route. This model is based on a stochastic transit service model presented by Andersson and Scalia-Tomba (1981) and enhanced by Marguier (1985). The use of a stochastic service model allows greater realism in the analytic modeling. Making use of these results, the paper presents an analytic model that may be used to determine the optimal holding time for a vehicle at a control stop. As it is formulated, the single vehicle holding problem is a convex quadratic program in a single variable, and is easily solved using gradient or line search techniques. The analytic holding model overcomes two noted problems in the literature: it includes stochastic service attributes of vehicle running times and passenger boarding and alighting processes, and the model may be used for real-time control purposes. The use and potential benefits of the model are illustrated in a simple example. This model may be useful in developing a computerized decision support system to enhance the effectiveness of transit operational decision-making.