Managerial commitment to the status quo and corporate divestiture: Can power motivate openness to change?

CEOs' commitment to the status quo (CSQ) is a prominent psychological factor leading to their resistance to organizational change. In this study we focus on the moderating role of managerial power, a central element in strategic choice, in the relationship between CEOs' CSQ and corporate divestiture activity. Drawing from the resource dependence perspective of power, we identify multiple aspects of power (structural, ownership, prestige/social, and expert power) that reduce CEOs' resistance to corporate change arising from CSQ. This study contributes to the strategic leadership and organizational change literatures by underscoring the importance of considering how different power bases shape the decision making of top managers who may have tendencies to hold onto firm assets when the situation warrants change. With a better understanding of how various power bases may uniquely influence strategic outcomes in the presence of managerial psychological bias, we can more accurately assess the impact of power on firms' strategic actions.     

When do Public Managers Imitate Each Other? Mimetic Decision Making in Contracting Decisions of Danish Municipalities

Using organizational new institutional theory, this paper explores a core mechanism underlying contracting decisions in public organizations. A central proposition of this branch of institutional theory is that uncertainty leads to organizational isomorphism. The present study investigates this proposition by asking: When does perceived uncertainty lead public managers to imitative behavior in contracting out decisions? Contrary to most previous studies, we apply an individual level approach and relate different types of perceived uncertainty of decision makers to mimetic decision making. We define mimetic decision making as when decision makers deliberately obtain information about other organizations in order to possibly imitate them. In a survey of Danish municipal managers facing important and complex contracting decisions, we test our hypotheses about three types of perceived uncertainty and mimetic decision making. The results show that technological uncertainty is strongly related to mimetic decision making among public managers. However, we do not find significant results for either volume uncertainty or performance uncertainty. The paper illustrates how uncertainty, through mimetic decision making, is connected to organizational isomorphism. It further highlights that future studies should pay attention to the multidimensionality of uncertainty and its consequences.     

The configurational effects of board monitoring and the institutional environment on CEO compensation: a country-level fuzzy-set analysis

This study examines the causal complexity of how the effectiveness of board monitoring influences CEO compensation around the world. Previous research drawing from the managerial power theory and ‘increased career risks’ perspective offer alternative arguments for how low and high levels of effective monitoring by boards of directors influence CEO compensation. Adopting a configurational approach using fuzzy-set qualitative comparative analysis, we explore the idea that there are multiple causal paths leading to high levels of CEO compensation, such that theoretical logic from both theories may be relevant contingent upon the institutional environment in which the relationship is embedded. Our findings in a sample of 38 countries suggest that high CEO compensation is an outcome of both the presence and absence of effective board monitoring depending upon how it combines with minority investor protections and the cultural dimensions of power distance, uncertainty avoidance, and individualism, as well as the overall stock market value. Specifically, in countries with high levels of effective board monitoring, high CEO compensation will be more likely when the country’s culture is high in uncertainty avoidance, low in power distance and when there are strong protections for minority investors. Whereas in countries with low levels of effective board monitoring, high CEO compensation will be more likely when power distance is high and uncertainty avoidance is low and when there are weak protections for minority investors. Our country-level study highlights the theoretical strengths of employing a configurational approach to explore the complex interrelationships of governance mechanisms and the contexts in which they manifest.     

Imitate Others? Not if We Have the Chance: Competitive Differentiation in Medical Malpractice Insurers' Pricing Decisions under Uncertainty

Several perspectives assert that organizations facing uncertainty tend to imitate other organizations' actions. While one might therefore expect to see great homogeneity across fields characterized by uncertainty, it is surprising that this homogeneity has not been observed more frequently in practice. Research investigating this puzzle has typically focused on the role played by organizational characteristics or the information organizations possess about their environments. Instead, this study turns attention to the information others possess about the organization. To that end, I disaggregate organizational uncertainty into the uncertainty facing decision makers and the uncertainty faced by others about what those decision makers might ultimately do, providing a more fine grained analysis of uncertainty and its impact on competitive action than typically offered in this literature. I suggest that uncertainty in competitors' evaluations of the organization provides an opportunity for the organization to differentiate itself rather than imitate others. I also suggest that this effect is stronger than the effects of the uncertainty facing the decision makers themselves. Related hypotheses are tested on a panel of medical malpractice insurance providers. The study's perspective generates unique predictions regarding imitation and differentiation in this industry and across other contexts featuring both uncertainty and competition.     

Public planning and political strategy

Planning theory and practice derived from corporate experience, management science and rational decision theory have had little influence on decision-making in the public sector. The political environment and organizational complexity of public decision making render conventional approaches to objective, rational, comprehensive planning of limited value in government agencies and in private corporations involved in public policy making. A more effective approach to strategic planning and management must be based on an understanding of the political dynamics through which policies are made. It must adopt a variety of styles directly related to major functions in the policy making process and use a variety of political intervention and influence techniques that facilitate the implementation of plans and policies.     

Examining the Antecedents and Consequences of CIO Strategic Decision‐Making Authority: An Empirical Study*

Despite the strategic importance of information technology (IT) to contemporary firms, chief information officers (CIO) often still have varying degrees of strategic decision‐making authority. In this study, we apply the theory of managerial discretion to define CIO strategic decision‐making authority and argue that the CIO's level of strategic decision‐making authority directly influences IT's contribution to organization performance. We also draw on the power and politics perspective in the strategic decision‐making literature to identify the direct antecedents to the CIO's strategic decision‐making authority. A theoretical model is presented and empirically tested using survey data collected from a cross‐industry sample of 174 matched pairs of CIOs and top business executives through structural equation modeling. The results suggest that organizational climate, organizational support for IT, the CIO's structural power, the CIO's level of strategic effectiveness, and a strong partnership between the CIO and top management team directly influence the CIO's level of strategic decision‐making authority within the organization. The results also suggest that the CIO's strategic decision‐making authority in the organization directly influences the contribution of IT to firm performance and that effective CIOs have a greater influence on IT's contribution when provided with strategic decision‐making authority.     

Major capital decisions and technological change

This paper reviews a wide array of the analytical approaches to major capital decision-making available in the literature; indicates some of their weaknesses, especially when major technological changes are involved; suggests some modifications to improve their usefulness; and illustrates some of the additional benefits offered by such redesigned models The approaches examined are: neo-classical, including certainty and uncertainty models; behavioral, including organizational and simulation models; and financial, including evaluative and resource allocation models.After reviewing some of the practical issues confronted in the decision making process a modified general framework is presented to help strengthen the analysis of proposed capital projects Finally, bases are suggested for integrating evaluative investment criteria with the production capabilities embodied in major capital facilities and engendered by major technological innovations.     

Strategic planning for MIS

This article report on a study of the strategic decision to develop computerized management information systems (MIS) in 32 business organizations. THe findings suggest that this decision is a complex policy decision which involves protracted environmental negotiations, a high and escalating commitment of organizational resources, and extensive organizational preparation. Eleven organizational and environmental factors which influence the decision are identified through a literature review. The influence of these factors on the success of the decision is examined and recommendations are made for managing the decision-making process to insure improved decision outcomes.     

The constructive aspect of political behavior in strategic decision-making: The role of diversity

While there have been extensive empirical and theoretical investigations on political behavior, most previous empirical studies have focused on political behavior as a negative force. In order to extend prior research, this study reconciles the upper echelons theory with the broaden-and-build theory and the work of the positive organizational behavior movement to investigate the antecedents and effects of constructive politics. It explores how different aspects of diversity influence constructive politics and the extent to which the latter contribute to decision performance, namely, decision success and decision pace. Data were drawn from 200 survey respondents in Dubai. The results supported not only the role of constructive politics in decision performance but also the role of demographic and competency diversity in constructive politics. The current research contributes to the exploration of constructive politics in decision-making and raises additional questions in an attempt to supply, with related research, significant missing portions of the political behavior story.     

The dependence upon context of project critical success factors: test of the contingency hypothesis and effects of technological uncertainty and collectivism culture

Abstract

Although the relationship between critical success factors (CSFs) and project performance is established, evidence regarding the dependence on the context of CSFs is patchy. To advance this field, we conduct two complementary studies. Study 1 examines contingency theory regarding managerial CSFs using survey responses (N?=?211) of project management professionals from the United Kingdom. Using survey data from projects (N?=?336) in the United Kingdom, Study 2 examines the contextual dependence of managerial CSFs in a moderated-moderation, theoretical framework whereby project technological uncertainty moderates the relationship between managerial CSFs and project execution and efficiency, and in-group collectivism culture of the executing organisation moderates the effect of technological uncertainty. Results confirm that external and internal contexts influence managerial CSFs. Managerial CSFs have a greater than expected influence on project execution and efficiency. The positive effect of managerial CSFs is weaker when technological uncertainty is high. When technological uncertainty is high, the effect of managerial CSFs strengthens as levels of in-group collectivism culture increase. However, when technological uncertainty is low, the effect of managerial CSFs weakens as levels of in-group collectivism culture increase. We discuss the managerial and theoretical implications.     

Taxes,risky investments,and the simultaneous choice of organizational form and financing

By taking explicit account of liability limitations, we analyse the influence of taxes on the simultaneous choice of organizational form and financing. In a two-state model for a single reporting period investors striving for maximisation of expected utility choose the organizational form (with or without liability limitation) in which they implement a given risky real investment and decide how they finance it (equity or debt). We demonstrate that liability limitations result in tax-relevant differences between organizational forms. Thus, for example, the tax bases differ in relation to the chosen liability-contingent debt capital compensations as well as to tax loss offset rules. Therefore, even in the event of identical tax rates, taxes can influence the decision regarding the organizational form.     

Organizational Form,Ownership Structure and Corporate Performance: A Contextual Empirical Analysis of UK Companies1

This paper contributes to the literature on organizational form and performance (the performance-conduct paradigm) by examining the impact of two sets of variables that have not been examined previously: measures of environmental uncertainty and alternative forms of controlling separation of ownership from control. The paper first examines the extent to which contextual variables such as perceived environmental uncertainty and age of the organizational form moderate the relationship between organizational form and corporate performance. Next, the paper extends the analysis by examining the possible effects of ownership and control structures on performance. Measures suggested by agency theory, such as conventional ownership proxies (i.e. proportion of shares held by identifiable, homogenous groups), the proportion of non-executive board members and Fama and Jensen's concept of separation of decision management from decision control are used in the analysis. The results indicate that these measures have direct impact on corporate performance in their own right, though the main impact is indirect through interactions with organizational form variables.     

It’s all about culture! Institutional context and ownership concentration across Europe

It is widely recognised that the formal institutional context affects firm ownership concentration. However, the impact of the informal institutional context has received less research attention. Drawing from institutional theory, we tested our hypothesis that both the formal and informal (cultural) institutional contexts simultaneously influence firm ownership concentration. Based on a firm-level database of the largest 600 listed companies in 19 European countries for the period 2009–2015, we found that both formal and informal institutional contexts, considered independently from each other, affect the level of firm ownership concentration. However, when these institutional contexts are considered together, the significance of the formal institutional context's effect on ownership concentration disappears while the informal (cultural) institutional context remains significant. Specifically, our findings indicate that high power distance, collectivism, uncertainty avoidance, restraint, and short-term orientation favour firm ownership concentration. Overall, our findings demonstrate that the diversity in European cultures explains firms' different levels of ownership concentration across European firms, signalling that the European Union's efforts towards a common regulatory frame may not necessarily lead to a convergence of European firms' ownership structures and, consequently, of corporate governance practices.     

基于实物期权的新技术投资决策实证研究

本文基于对我国高新技术企业的实际调研,从实物期权视角检验不同类型不确定性对企业新技术投资决策的影响。研究结果表明,市场与政策不确定性对投资的延迟作用与技术不确定性对投资的促进作用得到不同程度验证,而竞争强度与投资不可逆程度对不确定性与投资关系的调节作用则不完全符合实物期权的理论预期。论文结果揭示了我国高新技术企业进行投资决策的一般规律,可为企业应用实物期权方法提供参考。     

The Dynamics of Employee Dissent: Whistleblowers and Organizational Jiu-Jitsu

Whistleblowing is a form of organizational dissent that is rarely successful, instead usually leading to disaster for the whistleblower. Organizational theorists seldom have addressed the question of how to improve whistleblowers strategies. A useful general perspective for doing this is to conceive of bureaucracies as authoritarian political systems. The concept of political jiu-jitsu, from the theory of nonviolent action, is adapted to organizational contexts and used to assess a range of tactics used by organizational elites against dissidents. The resulting implications for whistleblower strategies are assessed by comparison with standard recommendations offered by experienced whistleblower advisers.     

Distributed sensemaking in network risk analysis

This article responds to the call advancing risk science as an independent research field, by introducing a conceptual model for risk analysis based on distributed sensemaking. Significant advances in recent decades have expanded the use of risk analysis to almost every organization globally. Continued improvements have been made to our understanding of risk, placing a wide range of contexts under organizational control. This article argues that four dimensions are central in how organizations make sense of uncertainty in their context and hence do risk analysis: the activities the organization engages in, their sensory systems, the role and competence of individuals, and the ability to coordinate information through organizational structures. The structure enables insight into the decision-making process and the dimensions contributing to how organizations perceive risks and uncertainty in a given context. Three examples from the Arctic context illustrate the network risk analysis model's practical application and how it will expose weaknesses in these organizations’ risk analysis and decision-making processes. Finally, the article discusses sensemaking in network risk analysis and how such an approach supports organizations’ ability to perceive, collect, process, and decide on changes in context.     

Information Technology in Public Services: Towards the Contractual Organization?

The growing trend towards information technology (IT) outsourcing is analysed within the UK public sector. The paper first details the research findings on factors influencing the degree of success experienced in a range of IT outsourcing deals. These factors are then utilized as a framework for analysing and discussing two case histories—of selective and large-scale IT outsourcing—drawn from different parts of the public sector. Both demonstrate how distinctive public-sector contexts influence the direction and degree of outsourcing. At the same time they highlight a range of managerial and organizational issues raised by moves towards contractual, core competence forms of organizing. Selective outsourcing is revealed as effective provided key decisions and actions are taken. The large-scale outsourcing case raises a number of critical issues not just for how it can be conducted in public-sector contexts, but also about the efficacy of such arrangements in terms of cost savings, possible over-dependence on a few suppliers, and ability to respond flexibly to changing political requirements and legislation.     

Understanding managers' preferences for internal markets versus business planning: A comparative study of German and U.S. managers

Internal markets and centralized business planning are alternative organizational designs for coordinating the economic activities within a firm. While some preliminary theory about when to use each exists in the literature, little is known about how managers understand and decide when to use one or the other. The study develops and tests in samples of German and U.S. managers a preliminary theory about factors that influence the preferences of managers for internal markets or planning as alternative modes of coordination. Managers' preferences are influenced by key constructs of internal markets and planning theory (the perceived limits of planning, speed and efficiency of markets, motivation potential of markets), but also by differences in their institutional contexts (national government and business context, company culture, and recent company experience with planning and internal markets). The study is the first to explore the substitutability of internal markets and planning within the strategic decision process of managers, closer to where it becomes reality.     

HRD,the science of the artificial

Innovation is the bedrock of organizational and national competitiveness across the globe. Leaders of research and development (R&D) teams have an especially important role to play given their direct influence on leading, organizing, rallying, and managing the operations of innovative tasks. However, when it comes to how leaders influence R&D innovation in different contexts, researchers' opinions diverge. This study explores leadership characteristics and their contextual contingencies, using the approach of a multiple case study. This paper is situated in the stream of research focusing on the interactions of leadership and contextual factors in innovation. We collected qualitative data from four highly innovative teams residing in two national laboratories in the US. The results suggest that while leadership demonstrates similarities across the four teams – a simultaneous focus on the internal and external domains, it also displays different characteristics in teams that differ on three contextual factors: funding model, nature of tasks, and team structure. Theoretical and practical implications are drawn.     

商业关系结束时的环境不确定性与交易关系规范研究

聚焦于商业关系结束阶段的交易关系规范行为,探索在不同的“交易结果信息传播”和“终止交易依赖”的条件下,厂商如何选择交易规范以应对环境的不确定性。收集了我国3个省份的312个样本,以MANOVA和GLM模型检验假设后发现：交易网络结构特征通过影响交易依赖度和传播信息,进而干扰厂商的商业关系退出策略。商业关系结束时,交易网络密度反向调节环境不确定性对团结规范的影响,较高的交易网络中心度反向调节环境不确定性对信息分享规范和弹性规范的影响。