Richard A. Johnson

The Market for Corporate Control and Firm Innovation

This research examines an integrated theoretical model that explains how strategies for participating in the market for corporate control (acquisitions and divestitures) affect internal control mec...

Conflicting Voices: The Effects of Institutional Ownership Heterogeneity and Internal Governance on Corporate Innovation Strategies

Examining the relationship between governance and corporate innovation strategies, we found, in opposition to the assumption that owners have a unified voice, differences among governance constitue...

Diversified Business Groups and Corporate Refocusing in Emerging Economies

As emerging economies have improved their economic institutions, the performance of many large business groups has been reduced because such groups acted as market-substitute mechanisms. Consequently, business groups have become increasingly involved in refocusing activities. The authors develop a framework in which such refocusing is explained as an attempt to balance overall transaction costs faced by groups with organization-specific costs in order to improve group performance. They examine external and internal factors that might lead to the initiation of refocusing and also explain why different ownership structures may affect the direction of that refocusing (e.g., related vs. unrelated diversification).

The Interface and Convergence of the Strategic Management and Organizational Environment Domains

Extending Bluedorns (1993) review of environmental contingency theory, we examine the strategic management research conducted from 1980-1993 that explicitly deals with the environmental domain. Framing our approach as a constrained strategic choice perspective, our focus on this intersection of the strategic management and organizational environment literature leads us to examine six specific subsets of this literature: (1) strategic leadership and upper echelons; (2) scanning; (3) interorganizational relationships; (4) institutional theory; (5) organizational alignment; and (6) strategic control and evaluation. In our discussions of these topics, we identify research trends and generalizations as well as identify promising research possibilities and questions for future research. In this vein, we conclude the article with our identification of several possibilities for theoretical syntheses and theory development.

The Effects of Cost and Asset Retrenchment on Firm Performance: The Overlooked Role of a Firm’s Competitive Environment

When firms face declining financial performance, research suggests that cost and asset retrenchment can lead to improved performance among poorly performing firms. However, previous studies have largely focused on firms operating in mature industries. This research develops and tests arguments that cost and/or asset retrenchment strategies will have different effects on firm performance in competitive environments characterized as growing and declining. In growth industries, asset retrenchment was positively related to performance improvement while cost retrenchment was unrelated. In declining industries, cost retrenchment was positively related to improved performance while asset retrenchment had a negative effect on firm performance. Implications of these findings for turnaround strategies are discussed.

Institutional Investors and Institutional Environment: A Comparative Analysis and Review

We provide a review of the literature surrounding institutional investor classifications, and we extend this research by examining the aforementioned classification systems and relate this to the three predominant financial systems (market-based, family-centred, and bank-centred systems). After integrating this literature we propose that future research can contribute to the corporate governance field in three main ways: through improved measurement of the central constructs, through more complex research designs (through moderated and/or longitudinal relationships), and through asking new types of questions. We suggest several questions and approaches for future research on institutional investors and their interrelationship with country financial systems.

Firm-Specific Human Capital and Governance in IPO Firms: Addressing Agency and Resource Dependence Concerns

Entrepreneurs with firm–specific human capital represent both a potential source of competitive advantage and a threat to appropriate the rents that are ultimately generated by a new venture. This situation presents interesting agency and resource dependence challenges. While potential investors in these ventures will want assurances that their interests are protected, they will also want to ensure that these key entrepreneurs remain with the organization. Using agency theory and resource dependence theory, we examine the types of governance mechanisms that are implemented in firms going through an initial public offering comparing those ventures which indicate a dependence on these critical entrepreneurs versus those that do not. Our analysis reveals that ventures exhibiting dependence on key entrepreneurs are associated with higher insider and outsider ownership by the board, greater start–up experience by the board, greater use of contingent compensation, and greater use of involuntary departure agreements.