his article examines the risks and opportunities associated with distributed ledgers technologies. A novel methodology is developed and presented in order to diagnose and manage their impacts using a strategic risk management perspective. Possible responses to the identified challenges are suggested.
Abstract Contemporary organizations with multinational business activities must strive to achieve strategic responsiveness to thrive and survive as they operate across a highly dynamic and complex global business environment. Here we emphasize the importance of combining the slow analytical strategy processes at headquarters with the fast autonomous responses taken by frontline agents in the subsidiaries in view of the changing conditions. New business developments are observed first in the fast activities around the multinational periphery where updated experiences from ongoing responses create useful insights that can be used strategically if management at headquarters is cognizant about its existence and able to collect this information. We introduce the notion of democratizing the strategic engagement of managers and employees at all levels and locations of the multinational corporation (MNC) as an essential leadership paradigm. The implied interaction between slow central analytical reasoning at headquarters and updated insights from fast decentralized initiatives in local subsidiaries constitutes an effective dynamic responsive mechanism. This dynamic interaction implies that critical strategic decisions made in the MNC must be informed by the diverse updated insights of managers and employees operating on the corporate frontlines tapping into the crowd wisdom readily available in and around the organization.
Jan 1, 2017·Proceedings of the ... Annual Hawaii International Conference on System Sciences/Proceedings of the Annual Hawaii International Conference on System Sciences
Gianluca Miscione, Rafael Ziolkowski, Liudmila Zavolokina, Gerhard Schwabe
The blockchain technology offers a novel mode of distributed authentication, which does not depend on a central authority. We consider this novelty against established governance modes. We illustrate our argument by paying special attention to blockchain-based authentication functions in the empirical domain of land registries across the world. Based on interviews with representatives from organizations deploying blockchain, and con-tent analysis of related grey literature, we discuss established governance idealtypes against what the rivalry that cryptocurrencies and blockchains bring to digital settings. After referring to market, hierarchy, network, and bazaar, we conclude outlining the prospects of a different, blockchain-related governance mode called -Ëtribalâ that better captures the -Ëtogethernessâ which rivalry originates.
Which is more innovative: the decentralized, diversified firm, or the centralized, more narrowly focused firm? The economics and finance literatures argue that diversified firms have innovation advantages as their operating units have access to an internal capital market. In contrast, the strategy and entrepreneurship literatures argue that managers of these firms suffer from âmanagerial myopia,â discouraging them from investing in projects with longâterm, uncertain payoffs. We take a fresh look at the relationship between innovation and diversification using a comprehensive sample of diversified and nondiversified firms and a novel approach that teases out the mechanisms influencing the relationship between diversification and innovation. Consistent with conceptual and empirical work in strategy, we find a robust negative correlation between diversification and R&D intensity, suggesting that diversification reduces innovation by discouraging investment. However, our analysis suggests that internal capital market inefficiencies, rather than managerial myopia, is responsible for this observed negative relationship.
People who work in large organizations often lament the decentralized structures that defi ne their work functions and day-to-day activities. Finance, IT, supply chain, legal, and any number of other organizational functions exhibit cultures that are distinctive in their work practices, processes, and perspectives. Colloquially referred to as silos, these internal organizational units are often characterized as impenetrable, and are frequently the subject of fi nger pointing and blame. They seem to stand in opposition to each other; the people within them seem to be optimizing for their own individual area rather than for the wellbeing of the wider corporate whole.
Innovation and Knowledge Management
Innovative Approaches in Technology and Social Development
Purpose â Crisis management entails among other things developing organizational systems that are capable of reacting to unpredictable and different types of crises. It also involves designing cohesive operational elements to deal with the local dynamics of an actual crisis situation. This challenge of responsiveness â where organizations simultaneously need to react to change demands of different task environments â has hardly been investigated in management theory. The purpose of this paper is to initiate to shed more light on this blind spot. Design/methodology/approach â Modular organizing and organizational sensing are introduced as key drivers of organizational responsiveness. Based on a large-scale survey among 1,200 senior officers the study investigates how these two variables have influenced the responsiveness of the Netherlands armed forces for crisis response deployment. Findings â The findings indicate that the level of modularization is an important facilitator of organizational responsiveness. Organizational systems that are made up of semi-autonomous work groups are in a better position to simultaneously live up to the change demands of different environmental levels than organizations that follow a fine-grained modularization approach. Originality/value â It uses the military crisis response organization as an exemplary case for project-based organzations in general to take advantage of.
Purpose â The purpose of this paper is to explore the link between R&D internationalization and finance decisions by providing survey evidence on the funding sources of R&D in light of recent perceptions of MNEs' decentralized knowledge-related competitiveness. Design/methodology/approach â The study draws upon a survey of 83 decentralized R&D units located in countries outside the EU core of mature economies. Funding sources are classified as MNE-internal and external. Using simulation-based models, six ordered probit regression models were run with each funding source forming the dependent variable. Findings â There are three significant findings. First, decentralized R&D funding relies mainly on MNE-internal sources. Second, decentralized R&D funding patterns reflect on the interdependencies within an overall MNE R&D strategy that is articulated through varied laboratory roles. Third, while the strategy-finance interaction is confirmed, the prevalence of parent funding is challenged. Instead, evidence recorded here suggests support for the decentralized, âsubsidiary-focusedâ perspective that has recently regained a considerable momentum in the literature. Research limitations/implications â Notwithstanding that this study reinforces the interaction between strategic decisions and funding patterns, more work is required to identify the effects of other aspects of strategy on the funding sources of decentralized R&D activity. However, it is seemingly the first study that investigates MNEs' R&D financial decisions in economies outside the EU core, incorporating also a wide array of external funding sources. Practical implications â Funding choices for decentralized R&D labs should be contingent upon their unique contribution to the competitive evolution of the MNE group. Further, R&D activity seems to leverage the autonomy of subsidiary managers. Originality/value â This research is one of the very few empirical studies providing evidence on the funding sources of decentralized R&D laboratories, and suggests possible predictors that have not been put forward hitherto.
The entrepreneurship literature in economics and management is biased towards start-up firms. And yet, profit opportunities are imagined, evaluated, and captured by existing firms. Employees often play a key role for developing and pursuing business opportunities (Baumol, 1994; Bhardwaj, Camillus, and Hounshell 2006). In fact, modern firms increasingly encourage âintrapreneurship,â âautonomous strategic initiatives,â and âcorporate venturingâ at all levels of the organization (e.g., Day and Wendler, 1998; Yonekura and Lynskey, 2002; Covin and Miles, 2007; De Clercq, Castaner, and Belausteguigoitia 2007). Clayton Christensenâs Innovatorâs Dilemma (1997), one of the most influential business books of the last two decades, deals with the difficulties facing established firms that try to innovate. To foster entrepreneurial attitudes and behavior, managers must give employees significant discretion. The need for such entrepreneurial attitudes is partly driven by deep-seated changes, sometimes placed under the rubric of the âknowledge economyâ (Foss, 2005). Thus, greater variability in the environments firms confront, more emphasis on innovation as a competitive tool, an increased need to source heterogeneous knowledge inputs, and so on call for an increased reliance on decision-making within firms that is not only fast, but also adaptive and intelligent. This amounts to an increase of delegation of discretion to employees at all levels in order to make them exercise responsible judgment. Cowen and Parker (1997: 28) cogently summarize this line of thinking: Market changes are moving manufacturing farther and farther away from steady-state, low variety, long-batch production runs, relevant to Taylorist methods, to high variety and small runs ⊠Organizations are adopting new forms of decentralization to cope with the instability, uncertainty, and pace of change of the market-place ⊠In clusters of network working, employees of undifferentiated rank may operate temporarily on a certain task or tasks in teams. The clusters are largely autonomous and engage in decentralized decision-making and planning ⊠They are conducive to individual initiative (âintrapreneurshipâ) and faster decision-taking. They facilitate organizational flexibility.
This article applies a sociomaterial perspective to IT-enabled change. The empirical data consists of in-depth interviews and internal documents from a longitudinal case study of the telecommunications company Ericsson. They managed to successfully transform their finance and accounting (F&A) unit from a highly decentralized structure into a so-called shared service centre (SSC) structure. The transformation was executed within three years and was enabled by an enterprise resource planning (ERP) system. The findings consist of a framework with four dimensions that explains that IT-enabled change is a practice that is both social and material: a sociomaterial practice. The contribution of this article is that it shows that it is in the entanglement of the social and material elements across time where we can find a deeper understanding of IT-enabled change.
This paper testified the privilege of SME cluster financing through an empirical study on the issues of financing situation of SME clusters.The empirical results show that the clustering is an innovation in SME's financing,which lays financing foundation for SME to solve the natural constraints.As a result,we must consider the risk sharing mechanism of symbiotic relationship,increasing the system utility and decentralizing systematic credit risk.An opinion has been put forward that the expanding the boundary of symbiotic relationship is an innovative mechanism of industrial clusters'financing.
Regional form of Organization of the health care that are called today DyPE, have as a main \ngoal to promote more rational resource allocation through decentralization in the decision \nmaking process. The concern for more effective and efficient use of resources devoted into \nthe health care sector renders hospitals a critical vehicle of the quest for superior economic \nperformance, especially if we take into our consideration their mounting over time deficits. \nEconomic performance is primarily traced through a set of specific financial ratios, which \nembrace important elements that constitute the substance of the financial well-being of \nhospitals as economic units. An array of financial ratios is critically reviewed and a \ncombination of them is proposed as a means of effective financial management. The later is \nnecessary to ameliorate the funding strain imposed on the health care system and especially \non hospitals. The financial performance is determined by the return on capital (profitability) \nin connection with the risk involved. Both factors determine the value created, which in turn \naffects the amount of financing attracted in the sector. The financial information available \nto the supervising regional bodies (DyPE), donât considered sufficient for their management \nto assess financial management of hospitals effectively. The lack of the appropriate economic \ndata is due to the fact that double entry accounting has not yet fully adopted by the economic \nunits that report to the corresponding DyPE. So, double entry accounting is prerequisite for \nreporting and monitoring acceptable financial performance. The later is vital in securing \nthat the financial needs of the health sector that are growing at an ever accelerating pace, \nare met.
This paper describes a case of a small start-up agency on intelligent, knowledgeable temporary staffs in Japanese mobile-phone industry as a new trend in the field of IT industry in Japan. In the rapid progress of technology and market, many enterprises in IT industry are facing to a serious shortage of knowledge/knowledgeable-employees on technology and market. For example, in the mobile-phone industry, the number of account customers has been so rapidly increased and varieties of services and technologies have also been so drastically increased that the employees inside mobile-phone enterprises cannot cover the whole service and technology. Therefore, outsourcing labor force like temporary staffs has become so important in the industry. However, the problem is that it is not easy to obtain appropriate labor force with sufficiently intelligent, knowledgeable for IT industry and market. The case analyzed here implies a clue to solve this problem by flexible, autonomous decentralized organization on temporary staff agency and effective self-education system. The characteristics of such a start-up enterprise and their manner of absorbing/sharing knowledge are discussed.
There is general consensus that coordination and integration are needed to achieve efficient outcomes while distributed decision power and autonomous actions are essential to develop innovative responses. These dual requirements for operational optimization and ongoing business innovation capture the essence of organizational ambidexterity as the means to sustain performance over time when environmental conditions change. This paper incorporates strategic management and organization theoretical rationales in a model that combines elements of integration and experimentation in the strategy making process and thereby extends the evolving literature on the ambidextrous organization. The performance relationships of the ambidextrous integrative strategy making model are investigated on the basis of a cross-sectional sample of 185 business entities operating in different manufacturing industries. Results of structural equation analyses indicate that superior performance in the ambidextrous organizations is associated with efficiencies derived from adherence to centralized strategic planning and effectiveness generated by decentralized innovative behavior through participation and autonomous actions. The study enhances our understanding of ambidexterity as the result of combined strategy making processes that balance the needs for economic efficiency and organizational adaptability.
The literature on knowledge sharing is extensive but organization design received little attention in this literature. A few useful exceptions are Birkinshaw e.a. (2002), Hansen (2002) and Tsai (2002). However, these attempts are yet too limited to fully understand the relationship between organization design choices and knowledge sharing. To contribute in filling this gap, we look at the fundamental organization design dimensions, specialization centralization, formalization, and coordination, in their relationship to the concepts of knowledge and knowledge sharing. While specialization creates firm-specific boundaries to knowledge sharing, coordination is the firm-specific mechanism to overcome these boundaries (Grant, 1996). A multiple case study approach was followed to collect our data, using a questionnaire in the Belgian divisions of two European companies active in the energy and finance sector. Based on a reassessment of the classic organization design literature, we assumed more inter-unit knowledge sharing when: decentralized and informal coordination is used, interdependency between units is low and specialization, reflected in knowledge complexity and unit differences, is low. Our findings indicated that interdependency and
One of the most significant journeys in our understanding of international business has been that from an essentially centralized view of innovation in MNEs toward one that encompasses an increasing range of decentralized inputs and strategic postures. This change in perspective can then be seen as decisively embodied within comparable changes in the way in which the effects of international business on individual host countries have been analysed. Here we can see a refocusing from an FDI-based interpretation of flows of separate firm attributes (increasingly technology and other intangible assets rather than finance capital per se) toward a more MNE-strategy oriented evaluation of how firms position their operations in a specific location within wider globalized programs (Pearce, 2001, forthcoming). The aim of this chapter then is to generate a methodology for the assessment of the ways in which MNEsâ globalized strategies for innovation involve themselves with the attempts of national economies to generate and operationalize innovation competences as a source of growth and international competitiveness. These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.
The past years have seen a decentralization of R&D to local markets and centresâofâexcellence. Supported by modern information and communication technologies, âvirtual project teamsâ were formed to facilitate transnational innovation processes. With their boundaries expanding and shrinking flexibly with changing project necessities, virtual teams are believed to be an important element in future R&D organization. Based on 204 interviews with R&D directors and project managers in 37 technologyâintensive multinational companies we identify four distinct forms of virtual team organizations used to execute R&D projects across multiple locations. Ordered by increasing degree of central project coordination, these four team concepts are based on: (1) decentralized selfâorganization, (2) a system integrator as a coordinator, (3) a core team as a system architect, and (4) a centralized venture team. Our contingency approach for organizing a transnational R&D project is based on four principal determinants: (1) the type of innovation (radical/incremental), (2) the systemic nature of the project (systemic/autonomous), (3) the mode of knowledge involved (tacit/explicit), and (4) the degree of resource bundling (complementary/redundant). According to our analysis, the success of virtual teams depends on the appropriate consideration of these determinants.
The competitive position of companies is increasingly linked to their capacity to attract and retain competent personnel. Human resources management, in particular compensation, is a crucial component of this quest for competencies. Yet companies must choose between several types of compensation policies. They must determine on which basis to select a policy so as to maximize the effectiveness of the compensation system. These choices may be linked to external strategies of the company, e.g. diversification, differentiation, or internal strategies such as autonomous work teams, total quality and participative management. This article therefore attempts to analyze the extent to which external and internal strategies identified by companies dictate their choice of compensation policies. In other words, do companies that adopt particular external and internal strategies also opt for differentiated compensation policies?The data were collected by a questionnaire mailed to vice-presidents and human resources managers of Quebec companies in competitive sectors. We received 252 usable questionnaires, equal to an 11.4% response rate. The variables have been grouped into four main categories: compensation policies, external strategies, internal strategies and control variables. By means of a multiple regression analysis using the forced entry method we have tested the contribution of each category of variables, thus allowing for verification of the hypotheses formulated. The control variables were entered first in a single block, followed by the external strategies and internal strategies. Utility tests were performed to verify whether the order of entry of the variables influenced the results obtained.The principal findings suggest that internal strategies dictate the choice of compensation policy to a much greater extent than do external strategies. In effect, companies seek above all to create internal coherence among their HR policies and organizational development strategies. For example, companies that rely heavily on autonomous work teams, engage in more participative management and promote quality management have compensation systems that are less traditional and characterized by a greater emphasis on performance, transparency of information provided to employees and, to a lesser extent, leader pay policies and decentralization of decision-making, which is consistent with the literature. Regarding the impact of external strategies, our results are more mitigated. Only competitive strategies emanating from business units exert a slight influence on the choice of compensation policies. Moreover, corporate strategies such as degree of diversification do not affect the choice of compensation policies. This type of strategy is apparently too far removed from the concerns of HR managers. Lastly, of the control variables examined, unionization plays the most determining role in the choice of compensation policies. In fact, this variable is the most consequential in our analytical model. This result raises important questions about the importance of the strategic approach to human resources management and reinforces the relevance of exploring institutional approaches to compensation policies.
Russell A. Eisenstat, Nathaniel Foote, Jay R. Galbraith, Danny Miller
Corporate organization's future lies in the ability to work across business units. Opportunity-based organizational design may help you succeed. Economic logic is driving two clear organizational trends. The need to be entrepreneurial and responsive to markets favors agile and focused companies. However, an unprecedented $3.4 trillion in corporate mergers and acquisitions around the world during 1999 is powerful testimony to the benefits of scale and scope. [1] Corporations are increasingly unwilling to sacrifice size and breadth for market responsiveness or vice versa; companies are now organizing to realize the benefits of both. IBM, for example, seeks to foster the entrepreneurial spirit of their employees by encouraging people in their lower reaches to show initiative. And companies such as British Petroleum, having disaggregated themselves into focused units, don't hesitate to grow larger through acquisitions. Nevertheless, many companies are still struggling to create entrepreneurial focus and to leverage and integrate their far-flung resources at the same time. One of the most important benefits of scale and scope is the ability to give employees privileged access to a wide range of resources throughout an organization. A global entity like Citigroup, for instance, boasts a considerable array of resources--including people, knowledge, products, and even relationships with outside partners--residing in functional, product, industry, and geographic units. But integrating such resources to serve a corporate client about to do business in, say, Thailand would inevitably require far more lateral work across hierarchical lines than traditional management precepts and designs envision. Using opportunity-based design Some companies do, however, seem to be getting it right. Rather than viewing the corporation as a portfolio of business units, their managers regard it as a portfolio of resources and of opportunities to create value. This opportunity-based design perspective gives these companies the flexibility to bring the most useful resources to bear on the most promising opportunities. But the resulting organization is more complex and poses new managerial challenges (exhibit). We have studied some two dozen companies that have adopted an opportunity-based design. Many of their managers, often working deep within operating units, discover opportunities in key global accounts, tightly defined market segments, or tailored product solutions. To exploit such opportunities, these entrepreneurs, regardless of their positions in the corporation, are authorized to mobilize whatever resources they need, such as product experts to create an integrated solution or functional and industry specialists, from a variety of countries, to serve a key global account. Opportunity-based design helps established companies emulate the market responsiveness of start-ups without sacrificing the advantages of scale and scope. Consider ABB, an engineering company long known for its decentralized structure, in which dozens of quasi-autonomous businesses are loosely linked to a wafer-thin corporate center. Increasingly, both the sourcing and the scope of ABB's projects around the world have cut across these units. Oslo's new airport was one such project. In 1994 the government of Norway suddenly gave the go-ahead for this long-mooted scheme. ABB's country manager immediately appointed an airport project leader, who persuaded all of ABB's more than 20 businesses in the country to work under his aegis. Together, these businesses and their external networks offered the complete set of resources needed for the project. Because the project leader--the owner--was empowered to coordinate these resources, and because the heads of ABB business units and functions--the resource owners--were willing to dedicate them to an opportunity that others had identified, ABB won 70 airport contracts, with a total worth of more than $300 million. âŠ
Abstract Recent changes in the global business environment have radically increased the demands which businesses have to fulfil to stay in the competitive race. Firms in the advanced countries are facing tremendous challenges from a number of sources: demands for enhanced quality and variability of goods and constant innovation in product development; severe price competition from low-wage countries; and much increased costs of new technology. Some of these demands are also beginning to impinge on newly industrializing societies (NIS). To cope with these new challenges, firms have begun to implement organizational innovations within firms and in their relations with other firms. Among the latter, relational contracting, networks, strategic alliances and horizontal co-operation in industrial districts have become particularly prevalent (Piorc and Sabel 1984; Powell 1990; Ring and van de Ven 1992; Alter and Hage 1993; Sydow 1996). Within organizations, networking, semi-autonomous working groups, and reciprocity are also accorded new importance (Rajan, van Eupen, and Jaspers 1997: 36; Turner and Auer 1994), as are forms of organizational decentralization of responsibility.
Discusses the effect of a decentralized approach to research and development facility location in the multinational corporation. Presents the comparative advantages of locating R&D facilities in strategic locations around the world. Examines the commitment required by a corporation to have an effective and flexible international research organization. Suggests that, if a company wants truly to be a âplayerâ in the international marketplace, one that is able to compete on both product quality and cost, a decentralized structure which allows for the establishment of autonomous R&D entities is necessary. Substantial risks are involved. Presents research and actual company histories to suggest that these risks could be offset with benefits from the strategic placement of research and development centres on a worldwide basis.