Contingency Fit, Institutional Fit, and Firm Performance: A Metafit Approach to Organization–Environment Relationships

In this paper, we attempt to reconcile contingency and institutional fit approaches concerning the organization-environment relationship. While prior scholarly research has examined both theories and compared their impacts on organizational fit and performance, we lay the groundwork for a meta-fit approach by investigating how contingency and institutional fit interact to influence firm performance. We test our theoretical framework using a dataset of 3,259 respondents from 1,904 companies regarding task environmental demands and institutional demands on organizational design across a broad range of industries and firm size classes. Our results show that contingency and institutional fit provide complementary and interdependent explanations of firm performance. Importantly, our findings indicate that for firms under conditions of “quasi-fit” rather than perfect contingency fit or optimal institutional fit, improvements in contingency and/or institutional fit will result in better performance. However, firms with high contingency fit are less vulnerable to deviation from institutional fit in the formation of firm performance, while firms with perfect institutional fit will slightly decrease their performance when they strive to achieve contingency fit.

Corporate Ownership, Control, and Firm Performance in Victorian Britain

Scholars have long debated whether ownership structure matters for firm performance. The standard view with respect to Victorian Britain is that family-controlled companies had a detrimental effect on operating profit and shareholder value. Here, we examine this view using a hand-collected corporate ownership dataset. Our main finding is that it was not necessarily the broad structure of corporate ownership that mattered for performance, but whether family blockholders had a governance role. Large active blockholders tended to increase operating performance, implying that they reduced managerial agency problems. In contrast, we find that directors who were independent of large family owners were more likely to increase shareholder value.

Are Good Industrial Relations Good for the Economy?

Recent US microeconomic analysis indicates that good industrial relations might improve firm performance. Of late, it has also been claimed that the benefits of industrial relations quality - proxied inversely by a strikes variable - could also extend to the macroeconomy. Using cross-country data, we find that, independent of other labor market institutions, a lower strike volume is associated with lower unemployment. Although there is a separate line of causation running from unemployment to strikes, our analysis suggests that this is not dominant. That said, support for the notion that macro performance owes something to good industrial relations is, however, weakened once we formally control for strike endogeneity.

Extending Customer Relationship Management into a Social Context

Informed by the resource-based view, this study draws on customer relationship management (CRM) and value co-creation literature to develop a framework examining the impact of social networking sites on processes to manage customer relationships. Facilitating the depth and networked interactions necessary to truly engage customers, social networking sites act as a means of enhancing customer relationships through the co-creation of value, moving CRM into a social context. Tested and validated on a data set of hotels, the main contribution of the study to service research lies in the extension of CRM processes, termed relational information processes, to include value co-creation processes due to the social capabilities afforded by social networking sites. Information technology competency and social media orientation act as critical antecedents to these processes, which have a positive impact on both financial and non-financial aspects of firm performance. The theoretical and managerial implications of these findings are discussed accordingly.

Ireland's Innovation Performance: 1991-2005

In this paper we use data from the five waves of the Irish Innovation Panel (IIP) to profile the innovation performance of manufacturing plants in Ireland and Northern Ireland over the period 1991 to 2005. Despite considerable public sector investment on both sides of the border levels of innovation activity have remained broadly similar throughout this period although somewhat different trends are evident in Ireland and Northern Ireland. In terms of product innovation for example, the proportion of manufacturing plants making product changes has increased 5 per cent in Ireland and just over 7 per cent in Northern Ireland. In terms of process innovation a decline of almost 7 per cent in Ireland has been accompanied by a 7 per cent increase in Northern Ireland. These trends provide some evidence of convergence in innovation performance over the 1991 to 2005 period. This is evident in the narrowing gap between the proportion of product innovators in Ireland and Northern Ireland, convergence in the proportion of plants undertaking process innovation and in terms of the increasingly similar proportions of sales derived from innovative products. Looking in more detail at the determinants of manufacturing innovation emphasises the importance of R&D and backwards supply chain linkages as sources of new knowledge for innovation. Other external linkages prove less important suggesting the value of policy initiatives designed to promote knowledge sharing. We also find a significant negative innovation effect from legislative restrictions on plants’ product innovation. Public support for both product and process innovation are having positive effects on innovation outputs at the level of the individual plant. Future research interest centres on the contrast between this strong positive result at firm level and the more modest increases in innovation among the population of firms in Ireland and Northern Ireland.

Technological regimes, Schumpeterian patterns of innovation and firm-level productivity growth

The article investigates the relationships between technological regimes and firm-level productivity performance, and it explores how such a relationship differs in different Schumpeterian patterns of innovation. The analysis makes use of a rich dataset containing data on innovation and other economic characteristics of a large representative sample of Norwegian firms in manufacturing and service industries for the period 1998–2004. First, we decompose TFP growth into technical progress and efficiency changes by means of data envelopment analysis. We then estimate an empirical model that relates these two productivity components to the characteristics of technological regimes and a set of other firm-specific factors. The results indicate that: (i) TFP growth has mainly been achieved through technical progress, while technical efficiency has on average decreased; (ii) the characteristics of technological regimes are important determinants of firm-level productivity growth, but their impacts on technical progress are different from the effects on efficiency change; (iii) the estimated model works differently in the two Schumpeterian regimes. Technical progress has been more dynamic in Schumpeter Mark II industries, while efficiency change has been more important in Schumpeter Mark I markets.