The role of strategic alliances in complementing firm capabilities
Strategic alliance research emerged to explain alliance formation based upon transaction cost minimisation and opportunism reduction. Later research, and early research from Japan, emphasised the role of alliances in facilitating the transfer of knowledge between organisations. Most recently, alliance research has focussed on the development of shared, potentially idiosyncratic, resource stocks. This paper builds on this recent research, testing the proposition that alliances are important vehicles allowing firms to access or acquire external resources, hence shoring up capability gaps and building new capabilities as required during firm, product and industry life cycles. Using a sample from Australian manufacturing small-and-medium-sized enterprises, the paper reveals that alliances employed by firms can be viewed as initiatives to either fill a gap in the firm's resource stock or to exploit a perceived opportunity in its operational and strategic environment.
Strategic planning, budget monitoring and growth optimism: evidence from Australian SMEs
Purpose – Growth optimism, which describes the expected future growth of a firm, is an important but underexplored construct in strategy. This paper aims to assess the planning antecedents of such growth optimism by using a large Australian sample of small enterprises.
Design/methodology/approach – The authors use a secondary data set, gathered among Australian small to medium enterprises (SMEs), by the Australian Bureau of Statistics (ABS). The analysis adopts a regression approach including a mediated and a non-mediated path to explore the direct and indirect effects of strategic planning and budgetary planning and management on expected future revenues.
Findings – This paper assesses the implications of concurrent strategic planning and financial management dynamic capabilities on anticipated future revenue growth, an important predisposition dynamic capability. The authors note that this configuration of actions and predisposition aligns closely with the necessary requirements for growth. The findings suggest that firms that use strategic planning and robust budget planning and monitoring processes exhibit higher optimism about future sales growth and firms that effectively configure these planning activities with market development tend to exhibit higher growth and more growth optimism.
Research limitations/implications – In terms of theoretical contributions, the paper strongly supports the formality view in the formal/informal debates associated with effectuation strategies. The authors suggest that appropriate strategic and budgetary planning and control systems act as a counterbalance to organisational confusion and managerial capriciousness, leading to improved confidence among managers and their employees regarding future resource commitments and plans.
Practical implications – The Findings of the paper are potentially important for both managers and policy makers. For managers seeking to grow their future sales, planning is shown to be an important antecedent activity. The presence of financial and strategic planning may predispose firms to make important investment decisions that drive future growth. Also, a better understanding of the firm’s current and future strategic and financial position may be evidence of effective firm management, a situation that, in turn, drives growth.
Social implications – In terms of social and policy implications, the data gathered for the survey by the ABS forms a valuable collection of information in relation to business practices. Australian firms are required by law to regularly report budget plans and outcomes. The research suggests that this data can inform policy initiatives, particularly in relation to programmes that may assist small and young firms to undertake prospective strategic and budgetary planning.
Originality/value – To the best of the authors’ knowledge, this is the first paper to investigate the particular configuration of strategic and financial planning and anticipated sales growth in the SME context.
Children's cyber-safety and protection in Australia: An analysis of community stakeholder views
Protecting children from the risks posed by negative influences in the online environment (that is, cyber-safety) is a growing concern within the Australian community. In this study, the views of 151 individuals and community stakeholder organizations, which represent the interests of children's cyber-safety in Australia, were analysed using content coding and analysis techniques. The analysis suggests that, given the accessibility of the online environment, stakeholders may need to exercise structured controls for child safety. In examining the major cyber threats and responses identified by the stakeholders, the study found that cyber-safety education and awareness programs are considered to represent the main effective and viable threat response. In addition, the research uncovered cyber bullying as a 'whole of community' problem that might be addressed through robust bullying prevention policies and programs, and improved resources and training for teachers, school principals and parents. The study notes that current policy directions for children's cyber-safety will need to flow through to every layer of the community.
Does open innovation apply to China? Exploring the contingent role of external knowledge sources and internal absorptive capacity in Chinese large firms and SMEs
While 'open innovation' is often considered to be an organisational strategy with universal application, its generalisability and applicability to organisations operating within emerging economies has yet to be fully explored. This study provides empirical evidence of its importance within a substantial sample of Chinese large firms and small and medium enterprises. Using Tobit regression analysis, our findings indicate that external knowledge sources from inter-firm networking are more important in creating the benefits of open innovation for Chinese small and medium enterprises than their larger peers. Linkages to university and research institutes generally have few direct effects on the innovation performance of both large and small firms in China. However, the role of universities and research institutes is shown to be important among our large firm sample when combined with evident internal absorptive capacity. This interaction is generally limited to our large firm sample, and is not as evident among small firms.
The solar photovoltaic feed-in tariff scheme in New South Wales, Australia
Solar Photovoltaic (PV) electricity systems are part of Australia's energy supply matrix. In the case of New South Wales (NSW), the state government has had to deal with a complex policy problem. In order to play its role in the federal Small-scale Renewable Energy Scheme, the NSW government initiated the 7 year Solar Bonus Scheme in 2010. However, in attempting to maximise community investment in small-scale solar PV systems, it relied on faulty financial modelling that applied a generous Feed-in Tariff (FiT) and underestimated the level of investor participation and installed capacity. Consequently, the scheme has resulted in very high public costs that will require policy changes that bring investors and energy retailers into conflict, and unpopular electricity retail price adjustments. This paper uses a structured case and stakeholder analysis to critically analyse the FiT policy, while also highlighting important lessons for policymakers engaging in FiT design.
The impact of employees' values on role engagement
The purpose of this paper is to investigate the manner in which employees' experience of distributive justice (DJ) moderates the impact of intrinsic and extrinsic values on role engagement (RE). RE is especially important in the healthcare setting (examined here) due to the sector's complexity, changeability and emotionally challenging nature. Design/methodology/approach Using data collected from a survey of employees from a large government health district in Southeast Queensland (Australia), this study examined the determinants of RE among a group of employees working across three hospital locations. Findings The focus of the study was on the impact, both directly and in combination, of espoused extrinsic and intrinsic values and perceived DJ on RE. The authors identify strong direct effects from DJ on RE, and complex third-order effects for the combinations of intrinsic (IM) and extrinsic motivation and DJ in predicting RE. Research limitations/implications As a cross-sectional and attitudinal survey, care must be taken in relation to common-method variance. Post hoc controls were performed in relation to this.
A reconsideration of Jack Welch's managerial legacy
Purpose – In this paper, the authors will examine Welch's legacy and aftermaths, both for GE and more broadly within management practice and academic thought. As a complex character, indeed a person of many contradictions, the authors try to avoid polemics in this, instead focusing on his accomplishments and the unanswered questions about his impact.
Design/methodology/approach – This paper is a historical case using secondary and published materials to assess the case of Jack Welch's leadership of General Electric over the period 1981–2001.
Findings – Welch's proponents suggest he emphasized controlling corporate destiny, being open to new ideas, pursuing quality and low cost, having confidence, a vision founded on reality, a global focus and possessing energy and enthusiasm. However, his short-termist perspective undermined the long-term success of the company and his "win at any cost" mantra predisposed some employees to cutting ethical or environmental corners. As the market capitalization gains evaporated that had been used to justify the "end justifies the means" rationale, little is left of his legacy.
Research limitations/implications – The paper discusses the implications of the GE case for issues associated with corporate governance, financialization and human resource management.
Originality/value – This is a timely reconsideration of the Jack Welch legacy two years after his death. In avoiding polemics and seeking a considered assessment of his positive and negative outcomes, the paper is an important addition to the research on Welch and American management thought.
Expectations of privacy and trust: examining the views of IT professionals
The growth of interactive online lifestyles and social networks has arguably left IT users more exposed to privacy breaches. While governments continue to revise privacy legislation, the issue of online business relationships and privacy expectations remain contentious. Indeed, fewer studies have explored the expectations of users who willingly and knowingly engage in online activities that carry privacy risks. In this study, we examine the expectations and attitudes towards online privacy of a select group of 102 IT professionals. Using a qualitative survey, we show that these users have expectations of online privacy, particularly securing and protecting information from unknown third parties. Unfortunately, these expectations may go unsatisfied with third-party monitoring enabling information disclosure. In response, users argue that enhanced technical and complementary administrative measures should be actively pursued to improve privacy outcomes. The article builds further understanding of privacy expectations and trust behaviours, while exposing the importance of technical credibility from the online organisation and user perspectives.
A configuration-based approach to integrating dynamic capabilities and market transformation in small and medium-sized enterprises to achieve firm performance
This article develops and tests a model integrating dynamic organisational capabilities, market transformation arrangements and firm performance. This model addresses weaknesses in previous empirical research by integrating accumulation and path dependency in measures of dynamic capabilities. Using a sample of 444 small and medium-sized Australian manufacturing firms, the study finds that performance is driven by the successful deployment of dynamic capabilities; such performance is mediated by purposeful market transformation strategies.
The debt crisis and the adoption of Asset-Light and Fee-Orientated (ALFO) arrangements at Marriott: 1980-1995
Purpose: This case study examines Marriott Corporation's large and successful spinoff between 1993 and 1995 and the concomitant adoption of a corporate ALFO strategy enabled by the transfer of assets and debt between the two entities. As an example of corporate restructuring, it involves changing ownership, operational structure, or business activities within a corporation in order to improve shareholder performance.
Methods: Key directional changes in Marriott's history that have changed the structure of the business is used to examine the spinoff and ALFO strategy adaptation.
Results: Marriot have been characterised by a small number of significant and foresightful innovations. There was a great deal of importance attached to the company's move away from food service and towards accommodation in the future. During the early stages of the company's existence, the company was located near Marriott's Bethesda headquarters and was headed by the founder's oldest son. There is no doubt that these investments have been probing in nature in the recent past, but they are significant in terms of scale and commitment in the future.
Implications: Marriott's success can be attributed to the fact that the company has a flexible corporate strategy that focuses on high growth and high yield business opportunities, as well as the willingness to dispose of assets that don't provide this outcome. As a result of this focus, the company was able to grow globally from the 1990s onwards. Ultimately, it can be said that the company's success can be attributed to the fact that it has adapted appropriately and successfully to changing operational and industry realities over the course of many decades, especially as exigencies in the asset and debt markets rendered the portfolio structure it had developed over so many decades unsustainable.