Knowledge that Transforms

abstractWe apply the prescriptions of the resource‐based perspective to develop a model of entrepreneurial opportunity evaluation. We propose that opportunity evaluation decision policies are constructed as future‐oriented, cognitive representations of ‘what will be’, assuming one were to exploit the opportunity under evaluation. These cognitive representations incorporate both (1) an evaluation of the existing resource endowments (already under the control of the venture), which may be employed to exploit the opportunity under evaluation, and at the same time (2) an assessment of the future, wealth generating resources that must be marshalled (and subsequently under the control of the venture) in order to exploit the opportunity under evaluation. We empirically test this model using conjoint analysis and hierarchical linear modelling techniques to decompose more than 2300 opportunity evaluation decisions nested in a sample of 73 entrepreneurs. Our findings suggest that entrepreneurs are attracted to opportunities that are complementary to their existing knowledge resources; however, we also identify a set of opportunity‐specific and firm‐specific conditions that encourage entrepreneurs to pursue the acquisition and control of resources that are inconsistent with the existing, knowledge‐based resources of the venture. We identify these conditions and discuss implications for theory, practice, and future research.

abstractWhereas the majority of research on board diversity explores the direct relationship between racial and gender diversity and firm performance, this paper investigates mediators that explain how board diversity is related to firm performance. Grounded in signalling theory and the behavioural theory of the firm, we suggest that this relationship operates through two mediators: firm reputation and innovation. In a sample of Fortune 500 firms, we find a positive relationship between board racial diversity and both firm reputation and innovation. We find that reputation and innovation both partially mediate the relationship between board racial diversity and firm performance. In addition, we find a positive relationship between board gender diversity and innovation.

abstractWe take stock of the current body of knowledge and understanding on organizational ambidexterity to further specify the construct and develop a typology to focus this line of research. To that end, we first synthesize the various insights on ambidexterity's conceptualization in extant research. We then develop a parsimonious, yet coherent typology that delineates four archetypes of ambidexterity using two primary dimensions underlying previous conceptualizations of this construct. To help focus and align extant research, we next map these types onto the most salient theories, antecedents, and outcomes that are uniquely germane to each. Finally, we offer several recommendations and promising avenues for future inquiries that follow from our typology and associated discussion.

abstractResearch on turnaround has largely focused on the impact of retrenchment and repositioning, and has paid less attention to the impact of changes in the task environment and human resources on recovery from decline. Moreover, all of the empirical research on turnaround has been conducted on private organizations. We develop a new model that is derived from theories of environmental and human resource effects on organizational performance. We apply this model to failing school districts in Texas, and find that turnaround is influenced by changes in the munificence and complexity of task environments, and the appointment of a new chief executive and front‐line staff.

abstractThis paper explains how strategic planning is able to deliver strategic integration within organizations. While communication and participation within planning processes are perceived to have an integrative effect, we argue that these effects are unlikely to arise simply from bringing people together. Rather, we suggest that, given the varying interests of actors in different business units, integration will only arise from active negotiations and compromises between these actors. The paper is based upon a case of strategic planning in a multinational that was attempting to develop greater strategic integration across Europe. Drawing upon an activity theory framework, we examine how a common strategy emerges over time through modifications to the planning process and to different actors' roles within it. The findings are used to develop a process model that shows how different business unit characteristics of planning experience and relative power shape different experiences of communication and participation activities and different processes for achieving integration. The paper concludes with a discussion of how this process model contributes to the literature on strategic planning, political processes of strategy‐making, and strategy‐as‐practice.

abstract Both researchers and managers are increasingly interested in how firms can pursue ambidextrous learning; that is, simultaneously exploring new knowledge domains while exploiting current ones. Ambidextrous learning is derived from intellectual capital architectures that underlie unique configurations of human, social, and organizational capital. We identified two distinctive architectures of intellectual capital that facilitate ambidextrous learning. Refined interpolation is an architecture comprised of specialist human capital supplemented by cooperative social capital, and complemented by organic organizational capital. Disciplined extrapolation is an architecture comprised of generalist human capital, supplemented by entrepreneurial social capital, and complemented by mechanistic organizational capital. As organization contexts to support these architectures, we have also identified two alternative HR configurations that facilitate ambidextrous learning. One HR configuration combines job or function‐based development, ILM‐based employee relations, and error embracing performance/control systems to support refined interpolation. The other HR configuration combines skill‐based development, market‐based employee relations, and error avoiding performance/control systems to support disciplined extrapolation. Our framework may provide valuable theoretical implications for HRM systems regarding the issues of internal fits and best configurations.

abstractThis work examines how the strategic choice and performance of late movers are influenced by the top management team's external ties, inside and outside the firm's industry. Using a multiyear sample of firms from the computer industry, we found that intra‐industry trade‐association ties of top managers led to the adoption of a resource‐imitation strategy by late movers while extra‐industry importation and professional‐association ties led to the adoption of a resource‐substitution strategy. We also found that trade association ties had a negative effect on the performance of late movers using resource‐substitution, while top managers' service on other firms' boards had a positive influence on the performance of those firms. Our findings not only confirm the importance of the role of fit in strategy and performance, but they also highlight the importance of the management and control of boundary‐spanning activities.

abstractWe merge research into knowledge management, absorptive capacity, and dynamic capabilities to arrive at an integrative perspective, which considers knowledge exploration, retention, and exploitation inside and outside a firm's boundaries. By complementing the concept of absorptive capacity, we advance towards a capability‐based framework for open innovation processes. We identify the following six ‘knowledge capacities’ as a firm's critical capabilities of managing internal and external knowledge in open innovation processes: inventive, absorptive, transformative, connective, innovative, and desorptive capacity. ‘Knowledge management capacity’ is a dynamic capability, which reconfigures and realigns the knowledge capacities. It refers to a firm's ability to successfully manage its knowledge base over time. The concept may be regarded as a framework for open innovation, as a complement to absorptive capacity, and as a move towards understanding dynamic capabilities for managing knowledge. On this basis, it contributes to explaining interfirm heterogeneity in knowledge and alliance strategies, organizational boundaries, and innovation performance.

abstract Agglomeration research investigates the benefits that firms receive from locating in close geographic proximity. Despite a substantial surge in interest in this topic over the past 20 years, a lack of distinction among unique manifestations of spatial concentrations of similar firms threatens continuing progress in this stream of research. We argue that agglomerations of related firms that draw benefits from the supply‐related externalities of increased access to specialized labour, specialized inputs, and knowledge spillovers are fundamentally different from those that draw benefits from heightened demand realized through reduction in consumer search costs. Extending agglomeration theory, we explicate the differences between these distinct phenomena, discuss how the nature of key theoretical relationships varies across these agglomeration types, and demonstrate significant implications for research. We discuss how the differences affect a host of theoretical relationships and empirical research decisions.

abstractThis study explores how relationship‐specific investment (RSI) enhances interfirm cooperation in buyer–supplier partnerships in an emerging market. Building upon the logic of economic sociology, we argue that the contribution of RSI to the success in buyer–supplier partnerships will be mediated by reduced opportunism and reduced conflict and by heightened commitment and knowledge sharing. Our survey of 216 paired distributors (buyers) and manufacturers (suppliers) in China generally supports this argument, leading to a conclusion that RSI is not a direct performance propeller but an important builder of relational infrastructure in which mid‐range processes are nourished. Theoretical implications in strategic management and supply chain management research are highlighted.