Search results
1 – 10 of 293Maria Cristina Longo and Masanori Yasumoto
This research explores how firms manage the complex technologies standardization in action groups. It considers the strategic issues that technology producers face when involving…
Abstract
Purpose
This research explores how firms manage the complex technologies standardization in action groups. It considers the strategic issues that technology producers face when involving lead users in architecture design. Drawing on the multi-mode standardization literature, this study addresses two dilemmas regarding value creation and appropriation by technology producers within coalitions. The first dilemma is how to create value by developing solutions in compliance with industry standards. The second one is how to appropriate value while ensuring the technology sharing with action groups. The answers to these two dilemmas contribute to filling the research gap on value creation and appropriation in multi-mode standardization.
Design/methodology/approach
The research focuses on technology producers participating in action groups where lead users play a crucial role. We conducted a qualitative analysis based on the standardization experience of a Japanese company specializing in smart robotics. Data are collected through semi-structured interviews with key actors. Action groups are defined operationally as a set of stakeholders including competitors of the technology producers, component suppliers, end users, services providers, research centers and academia. The case study is suitable for highlighting specific aspects of the standardization process during its manifestation. It reveals how firms create and appropriate value, providing details about its standardization strategy.
Findings
Our findings show that smart robotics standardization is drivn by collaborative models, where the two dilemmas of value creation and appropriation are evident. Firstly, the case revealed that standardization is lead users oriented. Secondly, lead users’ involvement is crucial to customize technologies. Thirdly, the firm’s position is to share a part of the value with the members. The IPR policy is a matter of interest within action groups, since the collaboration is based on open innovation models to share patents and licenses related knowledge.
Research limitations/implications
This research has some limitations attributable to the limited generalizability of the results due to the qualitative analysis. In addition, this study considers the perspective of technology producers, but should also take into account the perspective of both collective actions itself and the lead users. Findings have some implications in the strategy negotiation. Participating in action groups is not enough to ensure a competitive advantage. Involving lead users is of strategic importance to acquire a competitive advantage. Lead users contribute to the producers’ technology design, helping firms to differentiate solutions from the industry standard and create value from customized technologies.
Practical implications
This study helps practitioners understand the competitive side of collective actions, clarifying the value capture and appropriability in standardization. The research provides insights to policymakers and standard development organizations committees when they are called to harmonize standards considering the fallouts on the sector’s competitiveness. Findings suggest appropriate property rights policies to manage the issues related to the value appropriability and technology sharing, recognizing action groups members for their contribution in value creation.
Originality/value
This study shows how firms deal within action groups with the two dilemmas of variety versus technology conformity and property rights versus technology sharing. It fills the research gap in collective actions, emphasizing the perspective of the individual firm in the group rather than the coalition strategy itself. This topic highlights the crucial role of lead users within action groups in managing the two dilemmas, offering a new perspective for understanding critical issues of multi-mode standardization. Reflecting on mechanisms and tools to manage the two dilemmas allows firms to protect their competitive advantage in coalitions.
Details
Keywords
Abstract
Details
Keywords
Renato de Oliveira Souza, Sandro Cabral and Priscila Fernandes Ribeiro
This paper aims to examine the effects on firms' outcomes of a new government regulation on the private security industry that aimed to enhance the selection and training…
Abstract
Purpose
This paper aims to examine the effects on firms' outcomes of a new government regulation on the private security industry that aimed to enhance the selection and training processes for armed-private security officers.
Design/methodology/approach
By using human capital theory and using a data set built from various public sources, this study analyzes the effects of a new regulation implemented in 2013–2014 in Brazil mandating psychological assessments for hiring private security armed officers. Firm-level data and a Difference-in-Differences (DiD) identification strategy are used to investigate the effects on turnover and human capital outcomes.
Findings
The study identifies substantial changes resulting from the new government regulation in private security firms. While it has led to increased turnover rates, the regulation has also facilitated firms in enhancing the human capital composition of their workforce by enabling the recruitment of more experienced personnel.
Research limitations/implications
This research informs to current debates on the effects of policy interventions on firm's outcomes by showing how regulations aimed to improve the configuration of human capital can generate win-win situations for both firms and citizens, despite the short-term trade-offs between higher turnover rates and improved human capital outcomes.
Practical implications
Refining selection and training processes can enhance the workforce in private security firms by replacing less capable professionals with more experienced ones. Insights from this study offer guidance to policymakers and industry practitioners in shaping effective business and public policies.
Social implications
This study underscores the role of training and psychological assessments in enhancing the composition of human capital in the private security industry.
Originality/value
By highlighting the role of policy interventions in establishing barriers to unskilled workers engaging in hazardous activities, this study contributes to the burgeoning literature in strategic management on the interaction between policy interventions and firm outcomes.
Details
Keywords
Ashjan Baokbah and Vikrant Shirodkar
Research on the political connections of multinational enterprises’ (MNEs’) subsidiaries in emerging host countries has been growing. The purpose of this paper is to integrate…
Abstract
Purpose
Research on the political connections of multinational enterprises’ (MNEs’) subsidiaries in emerging host countries has been growing. The purpose of this paper is to integrate institutional and resource dependence theories to argue that MNEs-subsidiaries are likely to develop fewer formal (i.e. board-level) political connections when operating in welfare-state monarchies as compared to in host countries with developmental-state democratic systems. Furthermore, this paper argues that MNE-subsidiaries develop formal political connections to a greater extent in industries where religion influences the development of products and services considerably. Finally, the extent of developing formal political connections varies by the scale of the MNEs’ investment (or subsidiary density) in the host market.
Design/methodology/approach
The paper tests its hypotheses on a sample of foreign-owned subsidiaries operating in Saudi Arabia and Egypt. The data was collected by combining information from Bureau Van Dijk’s Orbis database with company websites and other secondary sources. The final sample consisted of 156 observations – 70 MNEs-subsidiaries operating in Saudi Arabia, and 86 in Egypt.
Findings
The findings confirm that foreign subsidiaries are likely to develop fewer formal political connections in a welfare-state monarchy as compared to in a developmental-state democratic system. Furthermore, formal political connections are more significant in industries that are impacted by the influence of religion – such as the financial industry in Arab countries. Finally, the extent of using political connections varies by the scale of the MNEs’ investment in the host market – that is, with a greater scale of investment (or higher subsidiary density), formal political connections are greater.
Originality/value
The paper contributes theoretically by explaining that a combination of institutional heterogeneity and its associated resource dependence conditions between MNEs and host governments influence MNE-subsidiaries' political connections. The paper tests its hypotheses in an emerging Arab context, which is characterized by both autocratic and semi-democratic political settings, and which makes the integration of institutional and resource dependence theories useful in explaining how MNE-subsidiaries navigate local complexities in this region.
Details
Keywords
Shifang Zhao, Xu Jiang and Yoojung Ahn
Research on the effect of executive equity incentives is equivocal. Based on agency theory, some scholars take the convergence of interest logic to highlight the benefits of…
Abstract
Purpose
Research on the effect of executive equity incentives is equivocal. Based on agency theory, some scholars take the convergence of interest logic to highlight the benefits of executive equity incentives. In contrast, others adopt the entrenchment logic to emphasize the increased agency costs. This study attempts to reconcile the debate on executive equity incentives and integrates the opposing views to unveil how executive equity incentives impact corporate social responsibility (CSR) performance.
Design/methodology/approach
Using the panel dataset of Chinese A-share listed firms from 2006 to 2022, this study integrates the convergence of interest and entrenchment logic to examine how executive equity incentives affect CSR performance.
Findings
We find that the relationship between executive equity incentives and CSR performance follows an inverted U-shaped form. According to the convergence of interest logic, executive equity incentives reduce agency costs when allocating resources to engage in CSR activities and enable firms to increase their CSR investments, ultimately realizing increased CSR performance. After a threshold, however, the accumulation of extensive equity incentives causes the entrenchment effect, resulting in declined CSR performance. Our empirical results also shed new light on its contingent perspective – the inverted U-shaped relationship is attenuated when firms’ stock liquidity is high.
Originality/value
This study attempts to reconcile the debate on executive equity incentives and integrates the opposing views to unveil the inverted U-shaped relationship between executive equity incentives and CSR performance. Our study opens promising avenues for further research on corporate governance and CSR strategies.
Details
Keywords
Paulo Ferreira, Jonas Oliveira and Graça Azevedo
This study aims to analyse the political connections of Portuguese companies through the members of the board of directors, exploring how these connections influence, in…
Abstract
Purpose
This study aims to analyse the political connections of Portuguese companies through the members of the board of directors, exploring how these connections influence, in particular, the composition and characteristics of the boards.
Design/methodology/approach
The research used a strategy based on analysing the financial statements and curriculum vitae of the directors of Portuguese companies listed on Euronext Lisbon from 2014 to 2019. The political connections of board members were examined, considering the variables identified in the existing literature.
Findings
The results indicate that companies with political connections maintain these relationships for long periods and have a greater number of members on the board of directors compared to companies without such connections. Directors with political experience tend to occupy non-executive positions, suggesting that companies may value political contacts more than the management skills of these directors. It was also found that there are politically connected directors who belong to multiple boards and that women appointed to the board are less likely to have a political background, reflecting male dominance in Portuguese politics.
Research limitations/implications
The main limitations of this study include the small number of listed companies in the sample, which may affect the statistical robustness of the results, as well as the use of secondary sources, which may not capture all relevant policy linkages. In addition, the results are specific to the Portuguese context and may not be generalisable to other countries or other regions of the world.
Originality/value
This study contributes to the understanding of political connections in Portuguese companies, offering valuable insights into how these connections influence board composition and can impact corporate strategy and governance. The findings of this study can be especially useful for business leaders looking to optimise the formation of their boards of directors.
Details
Keywords
Asmund Rygh and Carl Henrik Knutsen
Recent international business research finds that state-owned multinational enterprises (SOMNEs) invest relatively more in politically risky host countries than do privately-owned…
Abstract
Purpose
Recent international business research finds that state-owned multinational enterprises (SOMNEs) invest relatively more in politically risky host countries than do privately-owned multinational enterprises (MNEs). This study aims to investigate theoretically and empirically whether state ownership mitigates the impact of host-country political risk on subsidiary economic risk.
Design/methodology/approach
The authors link theoretical arguments on state ownership to arguments from non-market strategy literature to outline mechanisms whereby state ownership can buffer subsidiaries from political risk, weakening the link between host-country political risk and earnings volatility in subsidiaries. Using a data set on Norwegian MNEs’ foreign subsidiaries across almost two decades, the authors test this prediction using both matching methods and panel regressions.
Findings
While standard panel regressions provide empirical support only for the infrastructure sector and for the highest political risk contexts, nearest-neighbour matching models – comparing only otherwise similar private- and SOMNE subsidiaries using the full sample – reveal more general support for the political risk mitigation hypothesis.
Originality/value
The study presents the first comprehensive analysis of whether state ownership can mitigate the effect of political risk on subsidiary economic risk.
Details
Keywords
Silvia Ferraz Nogueira De Tommaso and Felipe Mendes Borini
Understanding how firms manage multiple stakeholders is an academic and business call. This paper aims to describe a firm’s processes to implement a stakeholder value creation…
Abstract
Purpose
Understanding how firms manage multiple stakeholders is an academic and business call. This paper aims to describe a firm’s processes to implement a stakeholder value creation system, defined as the firm’s processes to create appropriate value with multiple stakeholders.
Design/methodology/approach
The authors based their investigation on a conceptual framework extracted from a previous literature review. From there, the authors conducted qualitative empirical research designed as a multiple-case study. In-depth interviews with 47 people from 11 different firms are the key source of this study.
Findings
This paper proposes a framework demonstrating how a firm can implement a stakeholder value creation system. Results pointed to three processes: value creation, distribution and capture. Value distribution mechanisms are drivers for both value creation and capture processes. The system is a set of multiple flow relationships between the firm and its stakeholders.
Research limitations/implications
This research is limited to the Brazilian context.
Practical implications
The stakeholder value creation system is composed of seven elements: walk-the-talk organizational behavior, stakeholder business model, societal non-attended need, stakeholder preference matrix, stakeholder bargaining power, retention of rents and governance mechanism. Managers may design their firm’s unique processes using these elements as drivers.
Social implications
The present investigation demonstrates that societal issues matter for firms to formulate strategies that positively impact their economic, social and environmental results.
Originality/value
The authors investigated competitive strategy concepts of value creation and appropriation from a combination of resource-based and stakeholder theories and a system perspective. The framework of this study consolidated both theories’ ideas from a complementary perspective. The authors suggest managers and academics should adopt the power of the “AND” position instead of the “OR” trade-off position.
Details
Keywords
Saroj Kumar Pani and Madhusmita Tripathy
This paper explains why some firms manage to capture disproportionate value from their network of relationships, leading to superior performance. The paper examines how a firm's…
Abstract
Purpose
This paper explains why some firms manage to capture disproportionate value from their network of relationships, leading to superior performance. The paper examines how a firm's dependencies affect its value appropriation potential (VAP) in economic networks.
Design/methodology/approach
The paper follows the axiomatic method and the embeddedness perspective of firms to develop an index called nodal power, which captures the power that accrues to a firm in exchange-based economic networks. Thereafter, using the formal method and simulation, it shows nodal power reflects a firm's VAP in economic networks.
Findings
The study analysis and findings prove that a firm's dyadic level exchange relations and the embedded network structure determine its VAP by affecting the nodal power. A firm with lesser nodal power is likely to appropriate less value from its relations even if it equally contributes to the value creation. This finding explains how the structural and relational characteristics of a firm's network enable disproportionate value appropriation.
Practical implications
Nodal power furthers the scope of analyzing firms' economic relationships and changing power equations in dynamic networks. It can help firms build optimal strategic networks and manage the portfolio of relationships by predicting the impact of changing relations on firms' VAP.
Originality/value
The paper's original contribution is to explain, through formal analysis, why and how the structure and nature of relations of firms affect their VAP. The paper also formalizes the power-dependence principle through a dependency-based index called nodal power and uses it to show how interfirm dependencies are key to value appropriation.
Details