Alleviating Managerial Dilemmas In Human-Capital-Intensive Firms Through Incentives: Evidence From M&A Legal Advisors


Strategic Management Journal

février 2017, vol. 38, pp.232-254

Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : Human-Capital-Intensive Firms, Human Capital, Managerial Dilemmas, Incentives, Capabilities, Micro-foundations, Mergers and Acquisitions, Law firms

We examine how human-capital-intensive firms deploy their human assets and how firm-specific human capital interacts with incentives to influence this deployment. Our empirical context is the UK M&A legal market, where micro-data enable us to observe the allocation of lawyers to M&A mandates under different incentive regimes. We find that law firms actively equalize the workload among their lawyers to seek efficiency gains while ‘stretching’ lawyers with high firm-specific capital to a greater extent. However, lawyers with high firm-specific capital also appear to influence the staffing process in their favor, leading to unbalanced allocations and less sharing of projects and clients. Paradoxically, law firms may adopt a seniority-based rent-sharing system that weakens individual incentives to mitigate the impact of incentive conflicts on resource deployment

Behavioral Strategy and the Strategic Decision Architecture of the Firm


California Management Review

2017, vol. 59, n°3, pp.5-21

Départements : Stratégie et Politique d’Entreprise

Mots clés : behavioral strategy, psychology, cognitive bias, strategic decision process

This special issue explores the impacts of behavioral strategy on managementpractice. Behavioral strategy can best contribute to management practice by shifting its focus from individual decision biases to the design of behaviorally informed decision processes at the level of the firm. This introduction identifies three types of organizational decision processes, shows how they interact with individual and group biases, and proposes a model showing how managers can design and deploy these processes to shape the strategy of the firm. It then introduces the articles in this special issue and discusses their contributions to the future of behavioral strategy

Estimating Value Creation from Revealed Preferences: Application to Value-Based Strategies


Strategic Management Journal

2017, vol. 38, pp.1964-1985

Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : buyer–supplier relationships; client-speciceconomies of scope; cooperative game theory; revealedpreferences; value-based strategy

We develop and apply a new set of empirical tools consistent with the tenets of value-based business strategies, leveraging the principle that “no good deal comes undone” and the methods of revealed preferences to empirically estimate drivers of value creation. We demonstrate how to use these tools in an analysis of value creation in buyer–supplier relationships in the UK corporate legal market. We show how the method can uncover evidence of subtle mechanisms that traditional methods cannot easily distinguish from each other. Furthermore, we show how these estimates can be used as parameters of biform games for out-of-sample analyses of strategic decisions. With readily available data on relationships between firms, this approach can be applied to many other contexts of interest to strategy researchers

Heterogeneous social motives and interactions: The three predictable paths of capability development: Heterogeneity in capability development paths


Strategic Management Journal

2017, vol. 38, n°9, pp.1755-1773

Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : deliberate capability development; motiva-tional microfoundations; social interactions; businessprocess performance; multilevel

Research summary: Limited attention has been paid to the crucial role of individuals' motivation and social interactions in capability development. Building on literature in social psychology and behavioral economics that links heterogeneity in individual social motives to social interactions, we explain how the variation, selection, and retention processes underlying a group's deliberate capability development are affected by the composition of the group in terms of individuals' social motives in interplay with the organizational-level motivational levers designed by managers. Our multilevel theoretical model suggests that individual-level heterogeneity leads to the development of capabilities along different paths. For practice, this implies that, according to the composition of the group in terms of social motives, capabilities are more or less technically and evolutionary adequate and a source of business process performance.Managerial summary:We propose that when a group of employees engages in developing one of the firm's capabilities, capability development will follow a different path according to what motivates most of the employees composing the group. We identify and discuss three paths. Two of these paths (convergence and congruence) can help improve business process performance in a stable environment, the third one (open-ended) in a dynamic environment. Our work invites managers to not only think in terms of more or less capability development, but also in terms of capability development path(s): the path(s) in which groups in the firm are currently engaged and the one(s) that are desirable given the firm's objectives and the nature of the environment(s) the firm faces in deploying its business processes

Public-Private Collaboration, Hybridity and Social Value: Towards New Theoretical Perspectives


Journal of Management Studies

septembre 2017, vol. 54, n°6, pp.763-792

Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : cross-sector collaboration, hybrid arrangements, interorganizational governance,organizational design, public-private partnerships, social value

Focusing on the collaboration intersecting public, non-profit and private spheres ofeconomic activity, we analyse the conceptual forms of hybridity embedded in these novel inter-organizational arrangements, and link them to different mechanisms of creating social value. Wefirst disentangle alternative notions of hybrid arrangements in existing literature by proposing aconceptual typology on two theoretically complementary yet distinct dimensions: hybridity ingovernance and hybridity in organizational logics. We show how both forms of hybridity canjointly occur in complex public-private and cross-sector collaborations, and propose the notion ofvalue as a crucial bridging point between these perspectives. Crucially, we develop a conceptualframework on key theoretical mechanisms leading to economic and social value in these inter-organizational collaborations. Our work deepens the understanding of how diverse, hybrid formsof collaboration can create value and builds critical links between previously disparate streams ofliterature on public-private interaction, cross-sect or collaboration and social enterprises

The expanding domain of strategic management research and the quest for integration


Strategic Management Journal

janvier 2017, vol. 38, n°1, pp.4-16

Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : literature reviews; paradigm; scholarly field; fragmentation, integration

This special issue of Strategic Management Journal was motivated by concern that the growing scope and diversity of the strategic management field creates the risk of incoherence and fragmentation and the belief that research reviews could contribute to synthesis and integration. In this introductory essay, we address the expanding domain of strategic management, consider where its boundaries lie, identify the forces engendering fragmentation, and discuss how this special issue—and research reviews in general—can assist convergence within the field of strategy. We conclude by addressing the potential for integration more broadly in relation to the theories we deploy, the phenomena we investigate, and cohesiveness of our scholarly community

The Recursive Nature of Institutional Change: An Annales School Perspective


Journal of Management Inquiry

janvier 2017, vol. 26, n°1, pp.17 - 31

Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : Annales School, Institutional change, Institutional logics, Events

In this essay, we propose a recursive model of institutional change building on the Annales School, one of the 20th century’s most influential streams of historical research. Our model builds upon three concepts from the Annales—mentalities, levels of time, and critical events—to explore how critical events affect different dimensions of institutional logics and exert short- or long-range influences. On these bases, organizations make choices, from decoupling to radical shifts in logics, leading to severe institutional changes that become the matter of history. As much as organizations are influenced by events and the prevalent institutional logics, their choices trigger macro-level changes in a recursive manner. More broadly, we comment on how fruitful is our approach to historicize organization studies

Where Do Market Categories Come From and How? Distinguishing Category Creation from Category Emergence


Journal of Management

janvier 2017, vol. 43, n°1, pp.87-110

Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : market category, category formation, strategic agency

This paper reviews several streams of research on market category formation. Most past research has largely focused on established category systems and the antecedents and consequences of categorical positioning (i.e. categorical purity vs. spanning; combination vs. replacement) but relatively ignored the formative processes leading to new categories. In this review, we address this lacuna to posit that scholarship would benefit from clearly disentangling category emergence from category creation. We analytically describe the differences between the two and elaborate the boundary conditions that guide and define which process is more likely to occur in a given market. Our review contributes to illuminating the role of organizational agency and strategic actions in market categories and their formation, which deserve greater attention due to their theoretical and practical implications

A Two-sided Matching Approach for Partner Selection and Assessing Complementarities in Partners’ Attributes in Inter-firm Alliances


Strategic Management Journal

janvier 2016, vol. 37, n°1, pp.206-231

Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : Alliance formation, Partner selection, Matching models, Complementarities, Empirical methods

Strategic alliances are undertaken to create value through complementarities of resources and capabilities of the partner firms. We develop a matching framework to study strategic alliances, taking a market perspective that explicitly incorporates key features of transactions in strategic alliances: two sided decision making in voluntary collaboration; quest for complementarities between indivisible and heterogeneous partner attributes; and competition on each side for partners on the other side. We assess the relative performance of matching models and binary choice models when estimating parameters within simulations based on a known functional relationship. Within the context of research alliances in the bio-pharmaceutical industry, we hypothesize and find support using the matching model framework for complementarity in partner size, and in upstream research capabilities

Category Spanning, Evaluation, and Performance: Revised Theory and Test on the Corporate Law Market


Academy of Management Journal

février 2016, vol. 59, n°1, pp.330-351

Départements : Stratégie et Politique d’Entreprise, GREGHEC (CNRS)

Mots clés : Categoryn Evaluation, Law firms, Mediation, Performance

Studies suggest that category-spanning organizations receive lower evaluation and perform worse than organizations focused on a single category. We propose that (1) these effects are contingent on clients' theory of value and that as clients expect more sophisticated services, they tend to value category spanners more positively and (2) the evaluation of producers mediates the relationship between category spanning and performance. We test our hypotheses using original data on corporate legal services in three markets (London, New York City, and Paris) over the decade 2000-2010. We find that (1) category spanners receive a better evaluation, and more so when their categorical combination is more inclusive and (2) evaluation mediates significantly the relationship between category spanning and performance. This study enriches our understanding of how audiences apprehend a whole market category system and why organizations span categories