Harbir Singh

Learning and protection of proprietary assets in strategic alliances: building relational capital

One of the main reasons that firms participate in alliances is to learn know-how and capabilities from their alliance partners. At the same time firms want to protect themselves from the opportunistic behavior of their partner to retain their own core proprietary assets. Most research has generally viewed the achievement of these objectives as mutually exclusive. In contrast, we provide empirical evidence using large-sample survey data to show that when firms build relational capital in conjunction with an integrative approach to managing conflict, they are able to achieve both objectives simultaneously. Relational capital based on mutual trust and interaction at the individual level between alliance partners creates a basis for learning and know-how transfer across the exchange interface. At the same time, it curbs opportunistic behavior of alliance partners, thus preventing the leakage of critical know-how between them. Copyright

Interorganizational Routines and Performance in Strategic Alliances

This paper applies evolutionary economics reasoning to the strategic alliance context and examines whether and how routinization processes at the partnering-firm level influence the performance of the cooperative agreement. In doing so, it introduces the concept of interorganizational routines, defined as stable patterns of interaction among two firms developed and refined in the course of repeated collaborations, and suggests that partner-specific, technology-specific, and general experience accumulation at the partnering-firm level influence the extent to which alliances result in knowledge accumulation, create new growth opportunities, and enable partnering firms to achieve their strategic objectives. We also consider how governance design choices at the transaction level shape the effectiveness of interorganizational routizination processes. Based on a sample of 145 biotechnology alliances, we find that only partner-specific experience has a positive impact on alliance performance, and that this effect is stronger in the absence of equity-based governance mechanisms. We interpret these results to support the role of interfirm coordination and cooperation routines in enhancing the effectiveness of collaborative agreements.

Complementarity, status similarity and social capital as drivers of alliance formation

Using data on U.S. investment banking firms’ syndication in underwriting corporate stock offerings during the 1980s, this study explores the factors that drive alliance formation between two specific firms. We compare resource complementarity, status similarity, and social capital as a basis of alliance formation. The findings indicate that the likelihood of investment banks’ alliance formation is positively related to the complementarity of their capabilities, as well as their status similarity. Social capital arising from banks’ direct and indirect collaborative experiences also plays a very important role in alliance formation. The number of deals given by a lead bank to a potential partner over the past three years has an inverted U-shaped relationship to the probability that the lead bank will invite the potential partner to form an alliance. Our findings indicate that status similarity and social capital have a stronger effect on alliance formation in initial public offering deals than in secondary offering deals, as the former are more uncertain than the latter. Using these findings, we discuss the role of complementarity, status similarity, and social capital in alliance formation. Copyright

CEO SUCCESSION AND STOCKHOLDER REACTION: THE INFLUENCE OF ORGANIZATIONAL CONTEXT AND EVENT CONTENT

In this article, we construe chief executive officer (CEO) succession events as instances of organizational change. Predictions of positive, negative, or inconsequential outcomes of succession events are contingent on two features of organizational context-presuccession organizational performance and organizational size-and three elements of the content of a succession event: the force initiating the change in CEO, the predecessors disposition, and the origin of the new CEO. We found that poor presuccession performance was associated with boardinitiation and predecessor departure. Stockholder reactions were positive when presuccession performance was poor and either boards or, to a lesser extent, CEOs initiated successions. Successions that occurred when performance had been good resulted in negative consequences, as did those caused by CEO disability. However, most successions studied were customary retirements associated with no significant stockholder reaction. CEO succession events are of central concern in organization theory. They are universal-if organizations survive long enough, they must experience succession-and they have provided a means for assessing the efficacy of leaders in shaping organizational fortunes by demarcating eras of stewardship. After some decades of research, however, scholars have not reached consensus on the general question of whether leaders make a difference. Instead, the literature on succession has led to a focus on specifying conditions under which it is more or less possible for individuals newly placed in the seat of legitimate authority to influence important organizational outcomes. Under certain circumstances, new CEOs can have palpable effects on

MANAGEMENT-BOARD RELATIONSHIPS, TAKEOVER RISK, AND THE ADOPTION OF GOLDEN PARACHUTES

This study compared the characteristics of the top management and boards of directors in large firms that have adopted golden parachutes for CEOs with those of an industry- and size-matched control...

Integrating Acquired Capabilities: When Structural Integration is (Un)Necessary

Acquirers who buy small technology-based firms for their technological capabilities often discover that postmerger integration can destroy the very innovative capabilities that made the acquired organization attractive in the first place. Viewing structural integration as a mechanism to achieve coordination between acquirer and target organizations helps explain why structural integration may be necessary in technology acquisitions despite the costs of disruption this imposes, as well as the conditions under which it becomes less (or un-) necessary. We show that interdependence motivates structural integration but that preexisting common ground offers acquirers an alternate path to achieving coordination, which may be less disruptive than structural integration.

Value creation and success in strategic alliances:: alliancing skills and the role of alliance structure and systems

The authors use evidence from more than 200 organizations to demonstrate how companies which invest in alliance structures to co-ordinate alliance activity and systems to capture, codify, communicate and coach alliance-related know-how, definitely reap benefit in a number of ways. They also provide guidance on alternative ways to organize alliance structure and learning and co-ordination systems. The path to these benefits is not easy and companies need resources, people, and caution in managing the dedicated alliance function.

Corporate and industry effects on business unit competitive position

We partition the variances of market shares, which we use as surrogates for competitive position, of the business units of all public manufacturing companies available in the Trinet data base into industry factors, corporate parent-specific factors, and business unit-specific factors. Our results differ somewhat from Rumelts (1991), which decomposed variances in profitability. We find that corporate parent effects on market share are considerably greater than zero when lines of business are defined more narrowly, when small business units are included, and when firms are medium-sized. Our results suggest that the relative importance of corporate, industry, and business unit effects depends on the types of criteria, such as the level of industry aggregation, whether small business units are included, and firm size, that are used to construct samples. Copyright

International and Intercultural Management Research: What's Next?

The 1994 Special Research Forum on International and Intercultural Management Research represents an effort to create a better understanding of problems and opportunities in international and inter...

Ownership Structure, Board Relationships and CEO Compensation in Large US Corporations

Abstract Concern over the continuing rise in executive compensation and lacklustre company performance has led to an increase in investor and board activity in corporate governance. Institutional investors are leading the new activity and changing the nature of the governance system in the United States. A model of the evolving governance system is presented and relevant characteristics of firm ownership structure and the CEO-board relationship are explored with regard to their impact on the pay-performance link. The results for ownership structure suggest that institutional investors do limit the payment of unearned compensation to the CEO, but that the presence of 5% equity owners has no significant impact. The results concerning the CEO-board relationship suggest that longer tenure as CEO leads to greater compensation, but neither the percentage of outside directors, the director retainer, nor the CEOs years of company service have a significant effect on compensation. Overall, the evidence supports t...