No abstract

We contribute to the organizational aspirations and corporate venturing literature by theorizing and testing (a) the influence of a firm’s idiosyncratic strategic posture on behavioral responses to performance attainment discrepancies, and (b) that performance feedback may influence multifaceted yet thematically related forms of search. Specifically, we examine the influence of performance feedback on equity-based external corporate venturing. We then propose that a firm’s entrepreneurial orientation (EO) is a critical contingency when theorizing about how firms respond to attainment discrepancies. Our findings indicate that a firm’s EO is an important contingency when considering behavioral responses to attainment discrepancies.

a b s t r a c tStrategy formation mode refers to the way organizations devise their strategies. While some organizations do so through an explicit, formalized, and planned method, other organizations unintentionally create patterns in their strategic decisions-a strategy formation route that is more emergent in nature. This research explores the relationship between strategy formation mode and firm growth. Further, this article explores two strategic processes-forecasting and long-range objective setting-and their efficacy in association with particular strategy formation modes. Primary and secondary data collected from 103 manufacturing firms were used to test the hypotheses. Results indicate that the relationship between strategy formation mode and firm growth is curvilinear (inverted-U shape). Further, a three-way interactive effect is found between strategy formation mode, forecasting, and long-range objective setting on firm growth.

We utilize the exploration/exploitation framework to examine how a firm’s engagement in exploration influences its portfolio of external corporate venturing (ECV) activities. Three forms of equity-based ECV are considered: corporate venture capital investments, joint ventures, and acquisitions. The organizational learning literature is used to investigate how a firm’s engagement in exploration influences its usage of acquisitions relative to its overall portfolio of ECV activities. The investing firm’s industry technological dynamism is posited as a moderator of the relationship between exploration and the relative usage of acquisitions. Utilizing a sample of 1,326 firm-year observations between 1996 and 2008, we find that exploration is positively related to the relative usage of acquisitions, though this relationship is moderated by the investing firm’s industry technological dynamism.

Although organizational slack is a prominent construct in strategic management, it is often treated as an antecedent or enabler of other organizational outcomes, and thus our understanding of where slack comes from is underdeveloped. We draw on the behavioral theory of the firm to develop a better understanding about the antecedents of organizational slack. In so doing, we address a gap in the literature on the antecedents of slack by developing base models showing how and why performance feedback influences the three most common types of slack studied in the literature. Moreover, we contend that ownership is an important contingency that influences these relationships because different types of owners are motivated by different norms. Within a “communitarian” culture such as Japan, domestic owners generally have a multifaceted relationship with the firm and hence are motivated by norms of reciprocity and embeddedness, thereby allowing managers to adopt a stakeholder perspective. In contrast, foreign investors typically have only an arm’s-length relationship with the firm and are thus motivated by stock price, thereby putting “contractarian” pressures on managers to adopt a shareholder perspective. This domestic/foreign ownership distinction influences how resources are allocated and therefore the relationship between performance feedback and different types of slack in the firm. We further emphasize that these relationships will vary in accordance to where the slack resides: internal or external to the firm. We find general support for our hypotheses.