| Decisional Comprehensiveness and Firm Performance: Towards a More Sophisticated Understanding |
| | Miller, Chet | Baylor U./Duke U. | chet_miller@baylor.edu | 919-969-9573 |
| | The value of comprehensive strategic decision making has been the subject of debate over the years. Recent empirical work, however, strongly suggests that comprehensiveness has positive effects on firm performance in turbulent environments but negligible effects in stable environments. While this consistency in recent findings is a positive development, work remains to be done. To extend the research stream, the possibility of curvilinear effects was investigated. For turbulent environments, comprehensiveness was hypothesized to provide diminishing returns as it increases, yielding a function that increases at a decreasing rate. For nonturbulent environments, comprehensiveness was hypothesized to have positive effects up to a point, and then negative effects, yielding a function that exhibits an inverted-U shape. Empirically, complex procedural comprehensiveness was found to have curvilinear effects while simple procedural comprehensiveness was found to have only linear effects. Implications for theory and practice are discussed. |
| | Keywords: Comprehensiveness; Performance; Turbulence |
| Pluralism in team decision making: How third-party involvement affects strategic decision outcomes |
| | Gibson, Cristina B. | Center for Effective Organizations, USC | cgibson@ceo.usc.edu | (213)-740-7057 |
| | Saxton, Todd | Indiana U., Indianapolis | tsaxton@iupui.edu | 317-274-3349 |
| | Third parties and consultants specifically play an important role in strategic decisions, but they have received little attention in research. This study develops a framework relating consultant roles and timing in strategic decisions to decision outcomes. We find that consultant involvement does not have a universal positive effect on decision effectiveness, and reduces team satisfaction with the decision-making process. Timing and group composition interact with consultant role, however, to affect decision quality. Specifically, we find that direction provided by consultants facilitates decisions when provided early, and particularly for heterogeneous teams. Strategic decision outcomes were improved for homogeneous teams when a consultant provided an expert or devil's advocate role. In a controlled experimental setting, then, we establish that pluralism in decision making through consultant involvement can offset inherent disadvantages of team composition and lead to better strategic decisions.
|
| | Keywords: Teams; Strategic decision making; Third parties |
| Autonomy versus strategic control in diversified companies: the management of conflicting strategic imperatives |
| | Markides, Constantinos | London Business School | cmarkides@lbs.ac.uk | 44 171 262 5050 |
| | Chu, Wenyi | National Taiwan U. | wenyichu@handel.mba.ntu.edu.tw | 886-22364-5141 |
| | What happens in situations where a division within a diversified company faces conflicting strategic imperatives? For example, how should we manage a division facing a volatile environment which is also very interdependent with other divisions in the group? Theory suggests that because of the volatility of its environment, this division should be granted autonomy; but because of high interdependence with other divisions, it should be centrally controlled and should be given little autonomy. In this paper, we identify several instances when situations of such conflicting strategic imperatives emerge. We hypothesize and empirically test how HQs can manage these kinds of situations. |
| | Keywords: diversification; autonomy; control |
| Business Strategy and Chief Executive Scanning |
| | Walters, Bruce A. | Oklahoma City U. | Bwalters@frodo.okcu.edu | (405) 521-5413 |
| | Priem, Richard L. | U. of Texas, Arlington | Priem@uta.edu | (817) 272-3865 |
| | This study examined three fundamental research questions. First,
does business-level strategy influence which sectors chief executives
scan in their external environments? Second, does business-level strategy
affect the internal characteristics and firm capabilities to which chief
executives attend? And third, is the fit among business-level strategy,
CEO external scanning patterns and CEO internal scanning patterns
associated with firm performance?
These questions were evaluated in two field studies. Study One was
an experimental study conducted in a field setting, wherein CEOs of
manufacturing firms responded to interactive, computer-delivered
scanning tasks. Study Two used survey methods with similar CEOs.
We found that business-level strategy affected both external and internal
scanning. Prescriptively, external scanning emphasis, internal scanning
emphasis, and business-level strategy all interacted to influence
performance.
|
| | Keywords: Environmental scanning; Business strategy; Competitive advantage |
| Phony Wars and High School Dances: The Evolving Process of Integration in Mergers Between Professional Services Firms |
| | Empson, Laura | U. of Oxford | laura.empson@sbs.ox.ac.uk | (44) - 1865 288650 |
| | In professional services firms (PSFs) the key value-creating resources are technical knowledge and client relationships. A resource-based perspective on mergers would suggest that gaining access to these resources represents the primary opportunity for value creation. However, these resources are often proprietary to individuals who may enjoy considerable operational autonomy within the PSF. Consequently, the ability of senior managers to advance the integration process is highly constrained. This paper reports the results of an inductive, longitudinal, case-based study of the merger process in the context of six PSFs. It seeks to identify the impediments to integration and to understand how they are overcome. It finds that, while individuals are initially reluctant to co-operate with their merger partner colleagues, they overcome their twin fears of association and exploitation during the course of a three year period following the merger. The paper identifies a multi-stage integration process, termed the "school dance" model, in which "integration entrepreneurs" play a central role in advancing the integration process by engaging in extensive inter-personal interactions in order to bring about resource exchange. |
| | Keywords: Merger; Professional; Knowledge |
| Elusive Empiricism |
| | Baucus, David Alan | Utah State U. | dbaucus@b202.usu.edu | (435) 797-1658 |
| | Mintzberg (1990) and Ansoff (1991) offer competing views of how practitioners penetrate the future; strategists engage in empiricism or cirtical reasoning to grasp entrenreneurial and strategy development processes. This study clarifies the intellectual traditions underlying the Mintzberg-Ansoff debate. Then, I model the nonlinear dynamics of entrepreneurial and strategy development processes (i.e., tied to growth in demand) through three time-stochastic regimes: highly chaotic, repetitive-probabilistic variance with divergent firm trajectories, and convergence to equilibrium. I specify links between Mintzberg's and Ansoff's alternative epistemologies and the varying stochastic character of growth processes.
My data show that 90 percent of demand growth involves nonlinear dynamics. Seventy nine percent of this process reflects the loss of stability, divergent firm growth trajectories, and changing stochastic nature. Demand growth displays a chaotic character in the middle 52 percent of growth processes (i.e., the diffusion of knowledge), so performance outcomes occur with almost equal probability and action-performance series reflect spurious relations. Consequences exist for theorists and empirical researchers. Specifically, constant conceptual clarity (i.e., theoretical precision) and the feasibility of empirically validating hypotheses do not always exist. |
| | Keywords: , Nonlinear Dynamic Processes,; Strategy Development Processes; Knowledge Theory of the Firm |