Resilience of Cyber Systems with Over‐ and Underregulation

Recent cyber attacks provide evidence of increased threats to our critical systems and infrastructure. A common reaction to a new threat is to harden the system by adding new rules and regulations. As federal and state governments request new procedures to follow, each of their organizations implements their own cyber defense strategies. This unintentionally increases time and effort that employees spend on training and policy implementation and decreases the time and latitude to perform critical job functions, thus raising overall levels of stress. People's performance under stress, coupled with an overabundance of information, results in even more vulnerabilities for adversaries to exploit. In this article, we embed a simple regulatory model that accounts for cybersecurity human factors and an organization's regulatory environment in a model of a corporate cyber network under attack. The resulting model demonstrates the effect of under‐ and overregulation on an organization's resilience with respect to insider threats. Currently, there is a tendency to use ad‐hoc approaches to account for human factors rather than to incorporate them into cyber resilience modeling. It is clear that using a systematic approach utilizing behavioral science, which already exists in cyber resilience assessment, would provide a more holistic view for decisionmakers.     

Multiple recipes for success – A configurational examination of business portfolio restructurings

This explorative empirical study investigates which sets of portfolio restructuring design characteristics, contingent on individual firm and industry characteristics, lead to successful business portfolio transformations. We draw on insights from the strategic change, strategic fit, and organizational turnaround literature and develop a contingency model for transformation success. To allow for complex configurations, we employ a set-theoretic approach based on fuzzy set qualitative comparative analysis (fsQCA). Our findings suggest that there is no single best strategy for restructuring a portfolio. Rather, there are multiple pathways to success in portfolio transformation, depending on a firm's competitive posture and industry environment. In particular, our results highlight the pivotal influence of prior firm performance and environmental jolts on the design of successful business portfolio restructuring (BPR) strategies.     

A dynamic business modelling approach to design and experiment new business venture strategies

Business Modelling has evolved as a key activity to reflect new business venture strategy by framing the way a firm will operate and how it will function in achieving its goals (e.g., profitability, growth, innovation, social impact). However, scholars and practitioners have criticized the adoption of a too static perspective in the design and use of conventional Business Model representations. Such a static perspective prevents nascent entrepreneurs experimenting with their Business Models and, as a result, identifying the most effective strategies, especially in terms of business sustainability and profitability. In this paper, we argue that combining conventional Business Model schemas with System Dynamics modelling results in a strategy design tool that may overcome several limitations related to a static view of Business Model representation. Mapping the different key elements underlying value creation processes into a system of causal interdependencies – through the use of simulation – allows strategy analysts and entrepreneurs to experiment and learn how the business reacts to strategic and organizational changes in terms of performance, innovation and value creation. As such, Dynamic Business Models provide useful insights to strategy formulation and business venturing by capturing how critical Business Model elements interact to produce enduring competitive advantages over time.     

Corporate governance as custodianship of the business model

Recently businesses have been encouraged to discuss their business models in their annual reports as a means of communicating their future intentions to readers of their financial statements. At the same time, corporate governance has continued to be a focus of attention. In this paper we set out the view that a useful way of regarding corporate governance is that of custodianship of the business model—by which we mean that the directors are responsible for sustaining and developing a company’s business model. A comparison of corporate governance and the activities required to sustain and develop the business model shows them to be essentially the same. A business model view has the advantage that it unifies the compliance and monitoring aspects of governance with the advisory and strategy-setting roles of directors, roles that have sometimes been seen as conflicting. Viewing corporate governance from a business model perspective highlights aspects of board responsibilities that are not explicitly recognised in the UK Corporate Governance Code and may have been neglected in the prevailing emphasis on compliance, but which are intimately connected to both network relationships and corporate culture which are now becoming a source of concern.     

Identifying Changing Aviation Threat Environments Within an Adaptive Homeland Security Advisory System

A critical component of aviation security consists of screening passengers and baggage to protect airports and aircraft from terrorist threats. Advancements in screening device technology have increased the ability to detect these threats; however, specifying the operational configurations of these devices in response to changes in the threat environment can become difficult. This article proposes to use Fisher information as a statistical measure for detecting changes in the threat environment. The perceived risk of passengers, according to prescreening information and behavior analysis, is analyzed as the passengers sequentially enter the security checkpoint. The alarm responses from the devices used to detect threats are also analyzed to monitor significant changes in the frequency of threat items uncovered. The key results are that this information‐based measure can be used within the Homeland Security Advisory System to indicate changes in threat conditions in real time, and provide the flexibility of security screening detection devices to responsively and automatically adapt operational configurations to these changing threat conditions.     

Real-time threat assessment based on hidden Markov models

An essential factor toward ensuring the security of individuals and critical infrastructures is the timely detection of potentially threatening situations. To this end, especially in the law enforcement context, the availability of effective and efficient threat assessment mechanisms for identifying and eventually preventing crime- and terrorism-related threatening situations is of utmost importance. Toward this direction, this work proposes a hidden Markov model-based threat assessment framework for effectively and efficiently assessing threats in specific situations, such as public events. Specifically, a probabilistic approach is adopted to estimate the threat level of a situation at each point in time. The proposed approach also permits the reflection of the dynamic evolution of a threat over time by considering that the estimation of the threat level at a given time is affected by past observations. This estimation of the dynamic evolution of the threat is very useful, since it can support the decisions by security personnel regarding the taking of precautionary measures in case the threat level seems to adopt an upward trajectory, even before it reaches the highest level. In addition, its probabilistic basis allows for taking into account noisy data. The applicability of the proposed framework is showcased in a use case that focuses on the identification of potential threats in public events on the basis of evidence obtained from the automatic visual analysis of the footage of surveillance cameras.     

Bargaining and Cooperation in Strategic Form Games

In this paper we view bargaining and cooperation as an interaction superimposed on a game in strategic form. A multistage bargaining procedure for N players, the “proposer commitment” procedure, is presented. It is inspired by Nash's two‐player variable‐threat model; a key feature is the commitment to “threats.” We establish links to classical cooperative game theory solutions, such as the Shapley value in the transferable utility case. However, we show that even in standard pure exchange economies, the traditional coalitional function may not be adequate when utilities are not transferable. (JEL: C70, C71, C78, D70)     

Organizational change and rigidity during crisis: A review of the paradox

When and how do existential crises, threatening business continuity, stimulate organizational change or cause the opposite—rigid preservation of established business practices? This question remains unresolved, despite three decades of deliberations in the academic literature, which still yields contradicting theoretical arguments and empirical results. One view argues and finds support for the hypothesis that posits an amplified propensity to change within threatened organizations. The other view supports the threat-rigidity thesis, implying reinforcing habitual practices. In this paper, we provide a novel holistic typology of organizational crises and then review the literature on the topic, summarizing existing insights within a theoretical framework comprising three interrelated sequential processes: organizational cognition, decision-making, and implementation. We analyze the gaps in the field's knowledge within each process and propose a research agenda to address these voids.     

Cooperation,Trust and Performance – Empirical Results from Three Countries

Reverting to the resource‐based view of strategic management and cooperation theory, we provide argumentation for the value of two critical resources to cooperating firms: cooperation experience and maxim‐based trust. The results of a large‐scale survey in three European countries (Austria, Slovenia and the Czech Republic) reveal an important fact: although cooperation experience contributes to business performance, the contribution of maxim‐based trust to success is significantly higher. As a result, corporate success depends not only on the quantity of cooperation experience, but also – and to an even greater extent – on the quality of cooperation with regard to the form of coordinative power established within the cooperation arrangement. Given that maxim‐based trust has been identified as a feasible coordination mechanism in cooperation relationships, it might therefore be freed from its frequent characterization as utopian and out of touch with reality.     

Fads and Fashions in Management Practices: Taking Stock and Looking Forward

Established management practices – such as Six Sigma or business process re‐engineering, as well as more recent practices such as agile management processes, HR analytics and beyond budgeting – are viewed by practitioners as the basic tools of their trade. Yet they have been known to wax and wane in popularity, often quite unpredictably, with one technique following the other in wave‐like fashion. The scholarly observation of this phenomenon has given rise to the literature on fads and fashions in management studies, which – building on earlier work in allied disciplines – has sought to explain the transience, persistence, and overall trajectory of management practices. In this paper, we review and integrate the existing literature on management fads and fashions, taking stock of the sizable body of work that has accumulated over the past three decades and which has, to our knowledge, never been reviewed comprehensively before. At the same time, we also note that technological change – with the advent of social media and the ubiquity of Internet connectivity, for example – has radically transformed how practitioners seek, consume, and engage with new practices, as well as the way in which such practices are broadcast and diffuse. In our review, therefore, we try to make this well‐established body of literature current by explicitly discussing how well its central tenets and theoretical arguments have stood the test of time, and propose useful directions for moving forward.     

Leader–member exchange (LMX) in context: How LMX differentiation and LMX relational separation attenuate LMX's influence on OCB and turnover intention

Using the group engagement model, we hypothesize that two differentiated leadership constructs – LMX differentiation at the group level and a new construct, LMX relational separation, at the individual-within-group level – interact with LMX to affect follower citizenship behaviors (OCB) and turnover intentions. Data from 223 followers and their leaders situated across 60 workgroups demonstrate that the effects of individual perceived LMX quality are contingent upon a group's overall variability in LMX (i.e., LMX differentiation) and employees' similarity in terms of LMX with their coworkers (i.e., LMX relational separation). Specifically, the effects of high quality LMX relationships on OCB and turnover intentions are weaker when group LMX differentiation or employees' LMX relational separation is higher, rather than lower. Our findings contribute to a growing stream of multilevel LMX research incorporating climate effects and offer an alternative view of differentiated leadership in groups. Key implications for theory and practice are discussed.     

Promoting Scholarship that Matters: The Uselessness of Useful Research and the Usefulness of Useless Research

Our ambition in this essay is to challenge received wisdoms about the importance of ‘useful’ management scholarship. Suggesting that usefulness and uselessness are contingent on issues of temporality and power, we advocate caution in assigning terms such as useful and relevant – they are inherently problematic, we argue, and should be viewed more as ideology than as empirical statements. We conclude by a call for reflexivity about what it is we are doing when we do ‘useful’ research, along with a greater concern for the values for which business schools stand.     

Interruptions to workflow: Their relationship with irritation and satisfaction with performance,and the mediating roles of time pressure and mental demands

Understanding the mechanisms of workflow interruptions is crucial for reducing employee strain and maintaining performance. This study investigates how interruptions affect perceptions of performance and irritation by employing a within-person approach. Such interruptions refer to intruding secondary tasks, such as requests for assistance, which occur within the primary task. Based on empirical evidence and action theory, it is proposed that the occurrence of interruptions is negatively related to satisfaction with one's own performance and positively related to forgetting of intentions and the experience of irritation. Mental demands and time pressure are proposed as mediators. Data were gathered from 133 nurses in German hospitals by means of a five-day diary study (four measurements taken daily; three during a morning work shift and one after work, in the evening). Multilevel analyses showed that workflow interruptions had detrimental effects on satisfaction with one's own performance, the forgetting of intentions, and irritation. The mediation effects of mental demands and time pressure were supported for irritation and (partially) supported for satisfaction with performance. They were not supported for the forgetting of intentions. These findings demonstrate the importance of reducing the time and mental demands associated with interruptions.     

Entrepreneurial Marketing in Online-Netzwerken

A growing number of professionals use online social networks (e.g., Xing or LinkedIn) for business reasons by specifically promoting themselves. Especially executives and entrepreneurs use business social networks as a marketing tool in order to manage their business contacts and, thus, positioning themselves as a brand. Using on Keller’s (1993) customer-based brand equity model, we focus on the special behavior of entrepreneurs in such social networks. Based on the a large data set from a leading social network, we empirically analyze whether entrepreneurs act differently than other users and whether this strategy pays off. Based on a SUR model, we determine what the drivers for entrepreneurs’ profile views and contacts are. The results show that entrepreneurs focus on communicating their intentions and competencies and engage actively in the community. Especially participating in user groups and attending community events are key drivers for success.     

Strategic Development of Business Models: Implications of the Web 2.0 for Creating Value on the Internet

There is virtually a consensus that, to remain competitive, firms must continuously develop and adapt their business models. However, relatively little is known about how managers can go about achieving this transformation, and how, and to what extent, different types of business models should be adapted. To illustrate the differential effect of environmental changes on different business model types, this article draws from the ‘4C’ Internet business model typology to elaborate on how a recent wave of changes on the Internet – the emergent Web 2.0 phenomenon – is affecting each of its four business model types. We argue that Web 2.0 trends and characteristics are changing the rules of the ‘create and capture value’ game, and thus significantly disrupt the effectiveness of established Internet business models. Since systematic empirical knowledge about Web 2.0 factors is very limited, a comprehensive Web 2.0 framework is developed, which is illustrated with two cases and verified through in-depth interviews with Internet business managers. Strategic recommendations on how to what extent different Web 2.0 aspects affect each business model type are developed. Executives can use the ideas and frameworks presented in the article to benchmark their firm's efforts towards embracing the changes associated with the Web 2.0 into their business model.     

Breaking the Ties That Bind: From Corporate Sustainability to Socially Sustainable Systems

Although the recent push toward sustainability is certainly generally a positive development in business and society, we can see many problems in the execution of the theory of sustainability. Where the triple bottom line calls on companies to weigh effects on stakeholders and the environment alongside profit, in practice in many cases, sustainability has been perverted to represent sustainable profits. In these cases, environmental impact and effects on people are only important insofar as they positively contribute to a firm‘s future profits. It is not only practitioners who have often espoused this misappropriated view of sustainability but also academics have lent credibility to this view. In this work, we start by criticizing the often espoused current view of sustainability and remind academics of their responsibility to adapt a more critical view of this narrow focus. We provide examples that show how the current system of capitalism has resulted in outcomes for people and the environment that are patently unacceptable. Reasons are given as to why there is much hesitation to change the status quo. We then call on academics to reexamine what the role of businesses should be within society, what obligations business and corporations should have in society, and how we can encourage meaningful change that results in a better world for future generations.     

Rating Threat Mitigators: Faith in Experts,Governments, and Individuals Themselves to Create a Safer World

This research explores public judgments about the threat-reducing potential of experts, individual behavior, and government spending. The data are responses of a national sample of 1225 to mail surveys that include measures of several dimensions of public judgments about violent crime, automobile accidents, hazardous chemical waste, air pollution, water pollution, global warming, AIDS, heart disease, and cancer. Beliefs about who can best mitigate threats are specific to classes of threats. In general, there is little faith that experts can do much about violent crime and automobile accidents, moderate faith in their ability to address problems of global warming, and greater expectations for expert solutions to the remaining threats. People judge individual behavior as effective in reducing the threats of violent crime, AIDS, heart disease, and automobile accidents but less so for the remaining threats. Faith in more government spending is highest for AIDS and the other two health items, lowest for the trio of violent crime, automobile accidents, and global warming, and moderate for the remaining threats. For most threats, people are not distributed at the extremes in judging mitigators. Strong attitudinal and demographic cleavages are also lacking, although some interesting relationships occur. This relative lack of sharp cleavages and the generally moderate opinion indicate ample opportunity for public education and risk communication.     

Competitive renaissance through digital transformation

Dramatic health, environmental, and social-related challenges put pressure on firms to rethink their strategies and growth paths. Is a digital-enabled transformation able to help firms cope with these challenges and drive a competitive renaissance of our economic system? Are extant theories and concepts able to interpret the digital transformation? This management focus section aims to advance a relevant and impactful research agenda in the area of “business strategy and digitalization” through 4 contributions – both conceptual and empirical – that contribute to the understanding of the so-called “digital transformation” and its implications for both scholars and practitioners.     

A Review of Theory in Family Business Research: The Implications for Corporate Governance

In recent years, increasing scholarly attention has been directed toward the field of family business research. Based on an exhaustive sample of 235 publications, this article provides a comprehensive review and a critical assessment of the theoretical underpinnings and corporate governance issues in family business research. Three predominant theoretical perspectives, namely principal–agent theory, stewardship theory and the resource‐based view of the firm, have emerged and provide empirical evidence that family businesses significantly differ from non‐family firms in important dimensions such as agency costs, competitive advantages or corporate governance structure. On their own, none of the aforementioned perspectives succeeds in addressing all complexities associated with family businesses and their corporate governance. Accordingly, joint approaches combining different theoretical frameworks can help to improve understanding of the family business. The article concludes by discussing possible directions for future research that might further contribute to building a comprehensive theory of the family business and its corporate governance.     

Kinship ties and employee theft perceptions in family-owned businesses

Family business research typically views family firms using the frameworks developed for non-family businesses (e.g., agency theory, institutional theory). Thus, using an evolutionary perspective on family may help address gaps in the family business literature, particularly regarding deviance. In the current study, we use kin selection theory to predict that family members receive preferential treatment and this history of privileges can create entitlement and lead genetically-related employees to misuse company resources. Using an experimental vignette methodology and data from 161 people recruited from an online panel, we found that the participants’ purported genetic relatedness to the owner of a business increased their theft intentions and decreased their expected severity of sanctions and likelihood of being reported. Biological sex moderated the relationships between genetic relatedness and theft intentions, as well as between expectations of punishment and theft intentions. Specifically, when females expected higher severity of sanctions or likelihood of whistleblowing, they were less likely to report theft intentions, compared to males. The results of this study suggest that family business owners should protect against theft by all employees, including genetic relatives. Future research using field samples would help provide context for these findings.