Annaleena Parhankangas

How Companies Learn to Collaborate: Emergence of Improved Inter-Organizational Processes in R&D Alliances

Previous research has maintained that the capacity to manage alliances is a distinct capability, defined as the ability to identify, negotiate, manage, monitor and terminate collaborations. This paper focuses on an important but hitherto neglected aspect of alliance capability by investigating how partnering firms may learn how to better manage their dyadic R&D collaborations. In particular, we seek to test the Nonaka and Takeuchi (1995) model of dynamic knowledge creation by establishing a link between the facilitation of four knowledge conversion processes – socialization, externalization, combination and internalization – and an improved capability to manage inter-organizational R&D processes. We specify and extend the model by identifying and testing several critical interactions between these knowledge conversion processes. Relying on data from 105 R&D partnerships in the global telecommunications industry, we suggest that the failure to support one of these knowledge conversion processes has the potential to hamper the proper functioning of the other knowledge conversion processes and thus the emergence of capability to manage dyadic R&D collaborations.

Employment Generation Potential of New, Technology-Based Firms during a Recessionary Period: The Case of Finland

This article analyzes the employment generation potential of new, technology-based firms during a recessionary period. The empirical data is from Finland, a country that was hit particularly hard by the economic recession between years 1990 and 1993. In spite of the recession, the number of NTBFs (new, technology-based firms) rose by 17% from 1986 to 1993. In traditional manufacturing industry branches, the overall employment fell by as much as 33% during the same period. Alternative hypotheses to explain the increase in the importance of NTBFs are presented and discussed in the light of research findings. Both flexible specialization and recession-push hypotheses receive support in the empirical data.

Inter-partner relationship, knowledge transfer mechanisms, and improved capability to manage R&D alliances: evidence from the telecommunications industry

This paper analyses the influence of the relationship between the alliance partners on the effectiveness of knowledge transfer mechanisms in promoting inter-organisational learning. In particular, we are interested in the role of inter-partner competition, knowledge complementarity and trust in moderating the relationship between the use of various knowledge transfer mechanisms and an improved capability to manage R&D alliances. Our results suggest that firms can expect utmost learning benefits from the use of knowledge transfer mechanisms in the presence of high inter-partner competition. In addition, we observe amplifying effects of knowledge complementarity and trust on the effectiveness of knowledge transfer mechanisms.

How experience and perceptions shape risky behaviour: Evidence from the venture capital industry.

Abstract This study addresses a hitherto underexplored, but potentially very central issue in venture capital research by investigating whether differences in risk perceptions and professional experience of venture capitalists prompt differing investment and risk reduction strategies. The study is based on a survey sent to 142 Swedish and Finnish venture capitalists, with a response rate of 63% (90 responses). Our results show that experience drives the perception of risk and the riskiness of the preferred investment portfolio. To be more specific, we find that in the presence of more pronounced perceptions of market and agency risk, partly stemming from their experience, investors seem to be willing to take more risks. This result may be attributed to overconfidence, illusion of control, or the speculative dimension of risk present in entrepreneurial settings. The portfolio risk is dynamically attenuated by the execution of various risk reduction strategies, such as syndication, information seeking, monitoring and the use of preferred stock. These findings lead us to believe not only that venture capitalists are proactive and responsible risk takers, who shield themselves from potential losses through a careful application of risk reduction strategies, but also that their responses to risk may resemble more the behaviour of typical entrepreneurs than that of typical managers.

Impact of input substitution and output transformation on data envelopment analysis decisions

ABSTRACT Data envelopment analysis (DEA) can aid managerial decision-making because it offers an opportunity to measure organizational performance in a holistic manner, aggregating data from partial indicators into a single comprehensive measure. However, there are some methodological hazards associated with the use of DEA that are especially relevant to managerial decisions, but which have been largely ignored in the literature. Herein, we identify and show the impact of a ubiquitous methodological hazard in DEA modelling – the economic assumptions regarding input substitutions and output transformations.

Liabilities, Advantages and Buffers of Newness: How Young Age Makes Internationalization Possible

This article presents a conceptual discussion and a theoretical framework explaining how the liabilities of newness, which are traditionally thought of as disadvantages that young companies face, contribute to early firm internationalization. Through a systematic analysis of the liabilities that international new ventures face, as well as the liabilities and the advantages that a young age provides, we are able to integrate findings from the existing body of diffuse research on newness and internationalization, and develop propositions for future empirical research. Based on previous liabilities of newness and foreignness research, our study provides a novel theoretical model that explains early internationalization over and beyond existing internationalization models.

Preventing dysfunctional conflict: examining the relationship between different types of managerial conflict in venture capital-backed firms

Abstract Prior literature reports mixed results relative to the performance outcomes of different types of conflict in top management teams. These conflicting results may stem from the complex interactions between different types of conflict. To address this gap in existing knowledge, we set out to explore the interactions between task, process, and affective conflict in entrepreneurial teams of venture-backed firms. Our data are based on a survey among 240 firms that received investment from Norwegian venture capital funds with a response rate of 25% (59 firms). Our results show that task conflict is positively related to affective conflict and that this relationship is partially mediated by process conflict. Furthermore, we find that team size moderates the relationship between task and process conflict. Our results provide a potential explanation for the previously reported inconsistent results on the outcomes of different types of conflict and suggest that especially nascent entrepreneurs with small management teams should be wary of all types of conflict – also those labeled as ‘functional’ by the prior literature.

Management Education and the Professions

Ongoing concerns about a perceived disconnection between management education and management practice and the limited skill base of business school graduates are evident in the literature. These problems have been looked at through various lenses, and the professional model of education has shown promise in addressing perceived problems with business schools and their graduates. Using concepts from the sociology of the professions including jurisdiction, professional identity, and the nature of professional work, this article explores recent criticisms of management education and addresses the stages and issues involved in migrating to a model of education that mirrors that used in the professions.