Yuval Deutsch

Despite decades of globalization, organization studies have consistently found evidence of community influences on firm behavior. In this study, we develop and test a nuanced theory on the relationship between community political conservatism and corporate social responsibility engagement by integrating social capital theory and the logic of appropriateness. We demonstrate that the influence of community political conservatism is contingent upon two types of community social capital: interfirm and cooperative social connectedness. These two types of social connectedness elicit the manifestation of two different aspects from community political conservatism: free-market and community orientations. While interfirm social connectedness enhances the negative relationship between community political conservatism and corporate social responsibility engagement, cooperative social connectedness weakens it.

Instrumental Stakeholder Theory has begun to suffer from what might be termed “mission drift.” Despite its initial success in creating a foothold for ethics in managerial decision-making, the efficiency arguments which now dominate this research stream have become counterproductive to the original goal of connecting ethics and capitalism. We argue in this paper that the way forward is by re-centering contingency, conversation, and inefficiency in stakeholder theory. To start this process, there needs to be a reckoning of some unintended impacts of the success of the instrumental stream of stakeholder research. For a contrasting approach, we draw on Richard Rorty’s pragmatism and its foundation of ethical “irony,” a state of continuous doubts about the utility of one’s moral vocabulary. We offer a Rortian approach to stakeholder theory, unearthing the possibility for new corporate target functions in the goals of harm reduction, solidarity, and social mobility, the foundational building blocks of an ironist ethical perspective.

Momentum theory suggests that acquisition experience leads to acquisition momentum in the form of a higher likelihood of subsequent acquisitions of the same type. However, this argument has been challenged theoretically and empirically. We reconcile conflicting predictions and findings of prior research and extend momentum theory by incorporating activity load as a novel causal mechanism to both replicate the base finding and explain deviations from it. We find that a high activity load due to increased acquisition activity acts as a counterforce to momentum, decreasing the likelihood of subsequent acquisitions of the same type. Moreover, we also find that the interplay of routines, cognitive frames, and activity load causes companies to alternate between different types of acquisitions – from small to large and from large to small – as management engages in attention modulation to preserve momentum. Taken together, our arguments and findings contribute to an improved understanding of temporal patterns of acquisition behaviour.

The market for acquisitions has been a blind spot in exploration-exploitation research in the new venture context. The introduction of the acquisition exit outcome as a performance dimension for new ventures, especially among high-tech ventures, shifts the traditional temporal logic of exploration-exploitation theory by introducing previously unacknowledged short-term benefits of exploration. We bring the acquisition outcome into the picture and investigate the relationship between the exploration-exploitation continuum and profitability, survival, and acquisition likelihood simultaneously. Using the Kauffman Firm Survey data, we provide evidence for a link between exploration and the likelihood of acquisition (defined as the business being sold to or merged with another business), although industry technology level poses a boundary condition such that the association is not observed in low- and medium-technology firms. An inverse U-shaped relationship that is monotone negative for most of the data range was found between exploration and the profitability of low- and medium-tech firms, and a negatively linear relationship was found for exploration and the profitability of high-tech firms. Our findings lend some support to the viability of “born to flip” strategies involving comparatively higher exploration levels in high-tech start-ups and sacrifice of short-term profitability.

We integrate the logic of appropriateness and social capital theory to develop a nuanced theory on the influence of political ideology on corporate social responsibility (CSR). While previous studies have found a negative relationship between conservatism and CSR, we show that such a relationship is not always present. We show that a politically conservative attitude toward CSR is contingent on environmental clues provided by two types of social capital – interfirm and community-based. Whereas the former enhances the negative relationship between political conservatism and CSR, the latter may actually lead to a positive relationship.

We provide a novel explanation for why new entrepreneurial entrants choose to locate in clusters despite the intense competition within them. By developing a model of locating in a cluster as a signaling vehicle, we formally demonstrate that high-quality new firms bear the costs of an intensely competitive locale to credibly demonstrate their, otherwise unobserved, resources and capabilities strength. By separating themselves from those who cannot compete, the high-quality entrants are more likely to attract crucial stakeholders. The model integrates organizational economics and organizational capabilities-based literatures in entrepreneurial settings.

Exploration-exploitation research to date has not properly addressed the issue of multiple performance dimensions and their potential trade-offs, especially in the context of start-ups where unique performance dimensions such as acquisition likelihood are relevant and coveted. This paper utilizes the recently completed Kauffman Firm Survey data to investigate the relationship between exploration- exploitation and the profitability, survival, and acquisition likelihood of start-ups simultaneously and to investigate potential trade-offs among these performance dimensions. A balance-is-best relationship is found for profitability of survived firms and for the acquisition likelihood of high tech firms, while an exploitation focus is found to maximize the survival chances of low and medium tech firms. For low and medium technology start-ups our findings are consistent with a trade-off between survival likelihood and profitability-given-survival, and for high tech start-ups our findings are consistent with a differently shaped trade-off between acquisition likelihood and profitability-given-survival.

Insight into organizational responses to stakeholder claims and influence attempts is critical to understand the challenges currently facing managers and organizations. Drawing on Kelman’s (1958) model of social influence, we advance the field’s understanding of the factors driving firm-level prioritization of competing stakeholder claims by developing a theoretical framework that accounts for both the stakeholder attributes that are important to relevant decision makers, and the decision makers’ motivations for accepting or rejecting the influence attempts of varying stakeholders. Our framework distinguishes itself from existing research by focusing on stakeholder prioritization, not salience, recognizing that stakeholder-related decisions result from group interaction and that important decision makers are not limited to those found within the classic boundaries of the firm. Consequently, we argue that decision makers are simultaneously stakeholders with attributes that might be relevant to other decision makers involved in prioritization. In addition, we identify a more extensive set of stakeholder attributes that includes powerlessness and illegitimacy.

The theory of exploration and exploitation is based on the logic of trade-offs and yet empirical research has rarely investigated these trade-offs as manifested between different dimensions of performance. In the context of start-ups, getting acquired is an additional performance dimension previously ignored in the ambidexterity literature. This paper utilizes the recently completed Kauffman Firm Survey data to investigate the relationship between exploration and the profitability, survival, and acquisition likelihood of start-ups simultaneously. A balance-is-best relationship is found for profitability of survived firms and for the acquisition likelihood of high tech firms, while an exploitation focus is found to maximize the survival chances of low and medium tech firms. For low and medium technology start-ups we find evidence of a trade-off between survival likelihood and profitability-given-survival, and for high tech start-ups we find evidence of a differently shaped trade-off between acquisition likelihood and profitability-given-survival.

Two obvious trends in corporate governance include broadening board accountability beyond shareholders’ interests and paying outside directors with equity compensation (stock and stock options). By integrating common agency and instrumental stakeholder theories, we examine the effect of stock compensation on secondary stakeholders and a firm’s participation in social issues, two areas where interests are less aligned with shareholder value. Consistent with our predictions, we found that while stock compensation may be an effective way to align directors’ goals to those of shareholders, it has adverse effects on important non-shareholder constituencies in the company’s operating environment.