Eric A. Fong

Effort, Performance, and Conscientiousness: An Agency Theory Perspective

The authors examine the moderating effects of conscientiousness on the relationships between agency controls and effort and agency controls and task performance. Results show that less conscientious individuals appear to increase effort through incentive alignment and monitoring, whereas conscientious individuals do not shirk with or without agency controls. Furthermore, results show that less conscientious individuals increase task performance through incentive alignment, but not through monitoring. The study confirms that motivation to act opportunistically differs between individuals unlike what is assumed by agency theory. Also, incentive alignment may be more effective than monitoring when attempting to align principal and agent interests.

Relative CEO Underpayment and CEO Behaviour Towards R&D Spending

Arguments based on labour market theory suggest that there may be CEO behavioural issues related to pay deviations from the labour market rate for CEO pay; however, few studies examine this phenomenon. This study attempts to address such behavioural issues by examining the influence of relative CEO underpayment on reductions in R&D spending, the differences in this relationship between firms in high R&D intensive versus low R&D intensive industries, and the moderating affect of ownership structure on the CEO underpayment and R&D spending relationship. Results suggest that relative CEO underpayment is associated with reductions in R&D spending in low R&D intensive industries and increases in R&D spending in high R&D intensive industries. Also, greater relative CEO underpayment leads to greater reductions in R&D spending in manager-controlled organizations as compared to owner-controlled organizations. This study provides evidence that pay deviations may, in fact, affect certain CEO behaviours, specifically relating to innovation.

Authorship and citation manipulation in academic research

Some scholars add authors to their research papers or grant proposals even when those individuals contribute nothing to the research effort. Some journal editors coerce authors to add citations that are not pertinent to their work and some authors pad their reference lists with superfluous citations. How prevalent are these types of manipulation, why do scholars stoop to such practices, and who among us is most susceptible to such ethical lapses? This study builds a framework around how intense competition for limited journal space and research funding can encourage manipulation and then uses that framework to develop hypotheses about who manipulates and why they do so. We test those hypotheses using data from over 12,000 responses to a series of surveys sent to more than 110,000 scholars from eighteen different disciplines spread across science, engineering, social science, business, and health care. We find widespread misattribution in publications and in research proposals with significant variation by academic rank, discipline, sex, publication history, co-authors, etc. Even though the majority of scholars disapprove of such tactics, many feel pressured to make such additions while others suggest that it is just the way the game is played. The findings suggest that certain changes in the review process might help to stem this ethical decline, but progress could be slow.

Review: agent-based models and hypothesis testing: An example of innovation and organizational networks

Hypothesis testing is uncommon in agent-based modeling and there are many reasons why (see Fagiolo et al. (2007) for a review). This is one of those uncommon studies: a combination of the new and old. First, a traditional neoclassical model of decision making is broadened by introducing agents who interact in an organization. The resulting computational model is analyzed using virtual experiments to consider how different organizational structures (different network topologies) affect the evolutionary path of an organizations corporate culture. These computational experiments establish testable hypotheses concerning structure, culture, and performance, and those hypotheses are tested empirically using data from an international sample of firms. In addition to learning something about organizational structure and innovation, the paper demonstrates how computational models can be used to frame empirical investigations and facilitate the interpretation of results in a traditional fashion.

FLEXIBLE NEW PRODUCT DEVELOPMENT PROCESSES AND APPROPRIABILITY: INTELLECTUAL PROPERTY AND FIRST-MOVER

Prior research argues that higher levels of innovation require less flexible, or more formalised, new product development (NPD) processes; that is, there is a negative relationship between level of innovation and flexible NPD processes. In this paper, we investigate the moderating role of firms’ appropriability strategies, intellectual property (IP) and first-mover, on the use of flexible NPD processes for different levels of innovation (radical, more innovative, and incremental). Using the Product Development and Management Association Foundation’s 2012 Comparative Performance Assessment Study, this research shows that the greater use of IP and first-mover appropriability strategies is associated with an increased use of flexible NPD processes as the level of innovation moves from incremental to radical. Therefore, the results show that the greater use of these appropriability strategies weakens the negative relationship between level of innovation and flexible NPD processes.

Strategic consensus of market orientation: a transitional economy perspective

In transition economies, firms are faced with the challenge of adapting to new competitive pressures domestically and realizing market opportunities abroad. A market orientation is central to such adaptation. Using a multiple-source, multiple-informant design, nearly 4000 employees from 180 Chinese manufacturing firms were surveyed to explore how market orientation evolves. Results show that consensus, about being market oriented, between top managers and non-supervisory employees positively affects firm performance. This consensus is more likely in firms with participative cultures. Interestingly, firm performance was unrelated to middle and top manager consensus and unrelated to middle manager and employee consensus. Also contrary to expectations, the formalization of organizational procedures is not predictive of strategic consensus.

The impact of diversifying and de novo firms on regional innovation performance in an emerging industry: a longitudinal study of the U.S. ethanol industry

ABSTRACT There is growing interest among strategy scholars and policy makers regarding the influence of diversifying and de novo firms on regional innovation activities in emerging industries. This paper examines how the population, entry, and exit of diversifying and de novo firms in regions influence regional innovation output in an emerging industry. Using longitudinal data from the U.S. ethanol industry, we find that the local population and exit of diversifying and de novo firms have differing impacts on regional innovation output. Our findings contribute to the literature on firm heterogeneity, agglomeration, and regional innovation systems.

THE IMPORTANCE OF INTER-TEMPORAL INTEGRATION IN NEW PRODUCT DEVELOPMENT

According to the knowledge-based view (KBV), knowledge is a valuable resource that can lead to a competitive advantage. However, in industries where codified knowledge is used in developing successive iterations of products, codified knowledge has the potential to become obsolete over time and thus can also be an impediment to innovation. Using cycle-time (competitor comparison) as a performance measure, we find that inter-temporal integration — organisational practices designed to transfer tacit knowledge between former and current employees in successive new product development projects (NPDS) — enables a firm to effectively utilize codified knowledge to enhance product development cycle-time performance. Furthermore, using dysfunctional design change frequency as a performance measure, we find that inter-temporal integration has a negative relationship to this variable, but the relationship is stronger when knowledge codification is high. The results provide evidence of an important boundary condition to the benefit of codified knowledge in new product innovation.