Theresa S. Cho

Attention as the Mediator Between Top Management Team Characteristics and Strategic Change: The Case of Airline Deregulation

We integrate the upper-echelons perspective with the attention-based view of the firm by examining the role of attentional orientation of top management teams (TMTs). In the context of airline deregulation, we find that deregulation caused a shift in managerial attention, but that this shift in attention was the greatest for firms that changed the composition and compensation of their TMTs in ways that favored the deregulated regime. We also find that attention partially mediated the relationship between TMT changes and strategy changes. The results of this study shed light on the transformation of industry attention patterns following an environmental shift, and the role of TMT composition and incentive systems in that process.

ISOMORPHISM IN REVERSE: INSTITUTIONAL THEORY AS AN EXPLANATION FOR RECENT INCREASES IN INTRAINDUSTRY HETEROGENEITY AND MANAGERIAL DISCRETION

Abstract DiMaggio and Powell (1983) argued that organizations, in their quest for legitimacy, are subjected to isomorphic pressures which produce increasing similarity among peer organizations over time: “Once an organizational field becomes well established ... there is an inexorable push toward homogenization.” Yet, in contradiction to this “iron cage” hypothesis, many industries became more heterogeneous, not more homogeneous, in their profiles during the latter decades of the twentieth century, particularly between about 1980 and 2000 (at least on the American landscape). Why didn’t “inexorable homogenization” occur? We argue that DiMaggio and Powell were correct about the forces that give rise to isomorphism but failed to anticipate several major macrosocial trends that caused those forces all to move in directions that diminished, rather than accentuated, isomorphism. For example, DiMaggio and Powell argued that ambiguity about goals will propel isomorphic change; but the goals for publicly-traded U.S. corporations became less ambiguous. They hypothesized that the fewer the alternative organizational models in a field, the faster the rate of isomorphism; but the array of organizational models increased significantly. We empirically illustrate the increased heterogeneity that occurred within American industries by tracing the trend toward divergence – on several dimensions of strategy and performance – within the steel industry. An analysis of 18 additional industries similarly yields far more evidence of increased heterogeneity than of increased homogeneity over the latter decades of the twentieth century. We go on to argue that reduced isomorphic pressures not only engendered greater intraindustry variety, but also increased managerial discretion, which contributed greatly to the romanticization of CEOs that occurred during the period 1980–2000.

Attentional Congruence and Interfirm Dynamics: A Study of Post-Acquisition Integration in High-Tech Industries

Drawing from the attention-based view of firm (ABV), we develop the notion of attentional congruence, or the degree of similarity in managerial attention at the dyadic level, between acquirer and target. We also and examine the impact of attentional congruence on the firm-level outcomes. Based on a sample of 190 acquisitions deals in high-tech industries, we show that attentional congruence between two firms has a non-linear effect on post-acquisition innovativeness of the merged firm. In addition, we also examine the moderating effects that impact upon attentional congruence such as of strategic complementarity and that of disparity in firm size. This study goes beyond prior work which has demonstrated that managerial attention drives firm behavior — to show that managerial attentional also critically affects the dynamics between firms.

SK Telecom — Going for the Global Leadership

This case is set in the period after the worldwide financial crisis that started in mid 2007. Focusing on SK Telecom, one of South Koreas largest telecommunications providers, it reviews the previous strategies implemented by the Korean firm as well as the key challenges that SK Telecom has faced during the period of 2008–2009. This case also reviews the other global strategies undertaken by other major telecommunications companies from other countries. Faced with home market stagnation as well as distressed credit markets, SK Telecom requires a renewed strategy for further growth ahead. The case allows students to examine the threats and opportunities associated with the firms internal and external environment, review its corporate portfolio, and formulate strategies for future growth of the firm. This case also highlights the different challenging market conditions in various markets and how these conditions affect the viability of SK Telecom seeking growth overseas.