Managing a portfolio of corporate venture units : challenges in achieving within-unit focus and between-unit coordination

Principal Topic: There is increasing recognition that the organizational configurations of corporate venture units should depend on the types of ventures the unit seeks to develop (Burgelman, 1984; Hill and Birkinshaw, 2008). Distinction have been made between internal and external as well as exploitative versus explorative ventures (Hill and Birkinshaw, 2008; Narayan et al., 2009; Schildt et al., 2005). Assuming that firms do not want to limit themselves to a single type of venture, but rather employ a portfolio of ventures, the logical consequence is that firms should employ multiple corporate venture units. Each venture unit tailor-made for the type of venture it seeks to develop. Surprisingly, there is limited attention in the literature for the challenges of managing multiple corporate venture units in a single firm. Maintaining multiple venture units within one firm provides easier access to funding for new ideas (Hamel, 1999). It allows for freedom and flexibility to tie the organizational systems (Rice et al., 2000), autonomy (Hill and Rothaermel, 2003), and involvement of management (Day, 1994; Wadwha and Kotha, 2006) to the requirements of the individual ventures. Yet, the strategic objectives of a venture may change when uncertainty around the venture is resolved (Burgelman, 1984). For example, firms may decide to spin-in external ventures (Chesbrough, 2002) or spun-out ventures that prove strategically unimportant (Burgelman, 1984). This suggests that ventures might need to be transferred between venture units, e.g. from a more internally-driven corporate venture division to a corporate venture capital unit. Several studies suggested that ventures require different managerial skills across their phase of development (Desouza et al., 2007; O'Connor and Ayers, 2005; Kazanjian and Drazin, 1990; Westerman et al., 2006). To facilitate effective transfer between venture units and manage the overall venturing process, it is important that firms set up and manage integrative linkages. Integrative linkages provide synergies and coordination between differentiated units (Lawrence and Lorsch, 1967). Prior findings pointed to the important role of senior management (Westerman et al., 2006; Gilbert, 2006) and a shared organizational vision (Burgers et al., 2009) to coordinate venture units with mainstream businesses. We will draw on these literatures to investigate the key question of how to integratively manage multiple venture units. ---------- Methodology/Key Propositions: In order to seek an answer to the research question, we employ a case study approach that provides unique insights into how firms can break up their venturing process. We selected three Fortune 500 companies that employ multiple venturing units, IBM, Royal Dutch/ Shell and Nokia, and investigated and compared their approaches. It was important that the case companies somewhat differed in the type of venture units they employed as well as the way they integrate and coordinate their venture units. The data are based on extensive interviews and a variety of internal and external company documents to triangulate our findings (Eisenhardt, 1989). The key proposition of the article is that firms can best manage their multiple venture units through an ambidextrous design of loosely coupled units. This provides venture units with sufficient flexibility to employ organizational configurations that best support the type of venture they seek to develop, as well as provides sufficient integration to facilitate smooth transfer of ventures between venture units. Based on the case findings, we develop a generic framework for a new way of managing the venturing process through multiple corporate venture units. ---------- Results and Implications: One of our main findings is that these firms tend to organize their venture units according to phases in the venture development process. That is, they tend to have venture units aimed at incubation of venture ideas as well as units aimed more at the commercialization of ventures into a new business unit for the firm or a start-up. The companies in our case studies tended to coordinate venture units through integrative management skills or a coordinative venture unit that spanned multiple phases. We believe this paper makes two significant contributions. First, we extend prior venturing literature by addressing how firms manage a portfolio of venture units, each achieving different strategic objectives. Second, our framework provides recommendations on how firms should manage such an approach towards venturing. This helps to increase the likelihood of success of their venturing programs.

Do board contacts matter? : an analysis of the relationship between boards of directors’ ties and the performance of Australia’s largest companies.

Boards of directors are thought to provide access to a wealth of knowledge and resources for the companies they serve, and are considered important to corporate governance. Under the Resource Based View (RBV) of the firm (Wernerfelt, 1984) boards are viewed as a strategic resource available to firms. As a consequence there has been a significant research effort aimed at establishing a link between board attributes and company performance. In this thesis I explore and extend the study of interlocking directorships (Mizruchi, 1996; Scott 1991a) by examining the links between directors’ opportunity networks and firm performance. Specifically, I use resource dependence theory (Pfeffer & Salancik, 1978) and social capital theory (Burt, 1980b; Coleman, 1988) as the basis for a new measure of a board’s opportunity network. I contend that both directors’ formal company ties and their social ties determine a director’s opportunity network through which they are able to access and mobilise resources for their firms. This approach is based on recent studies that suggest the measurement of interlocks at the director level, rather than at the firm level, may be a more reliable indicator of this phenomenon. This research uses publicly available data drawn from Australia’s top-105 listed companies and their directors in 1999. I employ Social Network Analysis (SNA) (Scott, 1991b) using the UCINET software to analyse the individual director’s formal and social networks. SNA is used to measure a the number of ties a director has to other directors in the top-105 company director network at both one and two degrees of separation, that is, direct ties and indirect (or ‘friend of a friend’) ties. These individual measures of director connectedness are aggregated to produce a board-level network metric for comparison with measures of a firm’s performance using multiple regression analysis. Performance is measured with accounting-based and market-based measures. Findings indicate that better-connected boards are associated with higher market-based company performance (measured by Tobin’s q). However, weaker and mostly unreliable associations were found for accounting-based performance measure ROA. Furthermore, formal (or corporate) network ties are a stronger predictor of market performance than total network ties (comprising social and corporate ties). Similarly, strong ties (connectedness at degree-1) are better predictors of performance than weak ties (connectedness at degree-2). My research makes four contributions to the literature on director interlocks. First, it extends a new way of measuring a board’s opportunity network based on the director rather than the company as the unit of interlock. Second, it establishes evidence of a relationship between market-based measures of firm performance and the connectedness of that firm’s board. Third, it establishes that director’s formal corporate ties matter more to market-based firm performance than their social ties. Fourth, it establishes that director’s strong direct ties are more important to market-based performance than weak ties. The thesis concludes with implications for research and practice, including a more speculative interpretation of these results. In particular, I raise the possibility of reverse causality – that is networked directors seek to join high-performing companies. Thus, the relationship may be a result of symbolic action by companies seeking to increase the legitimacy of their firms rather than a reflection of the social capital available to the companies. This is an important consideration worthy of future investigation.

Conceptualising a Chinese corporate governance framework : tensions between tradition, ideologies and modernity

Reflects on the challenges facing China's efforts to reform its corporate governance framework, and the extent to which the modernisation can be reconciled with the country's cultural traditions. Examines the development of China's legal and economic reforms since 1978, the debate which these have generated ad the shortcomings of the current corporate governance regime. Discusses how Confucian principles might be applied to issues of director's duties and corporate governance, and explains the benefits of such an approach.

The relationship between implied and realized volatility : evidence from the Australian stock index option market

This paper examines the relationship between the volatility implied in option prices and the subsequently realized volatility by using the S&P/ASX 200 index options (XJO) traded on the Australian Stock Exchange (ASX) during a period of 5 years. Unlike stock index options such as the S&P 100 index options in the US market, the S&P/ASX 200 index options are traded infrequently and in low volumes, and have a long maturity cycle. Thus an errors-in-variables problem for measurement of implied volatility is more likely to exist. After accounting for this problem by instrumental variable method, it is found that both call and put implied volatilities are superior to historical volatility in forecasting future realized volatility. Moreover, implied call volatility is nearly an unbiased forecast of future volatility.

Who and Why? Demographic and psychographic differences between consumers who have altered their shopping behaviour during a recession and those who have not

Research suggests that people differ in terms of changing their shopping behaviour during a recession. This paper reports on a preliminary descriptive study assessing what influences those consumers who have altered their shopping behaviour during such times. Driving the alteration of shopping behaviour were both demographic (age, gender, education, and nationality) and psychographic variables (attitudes, and head vs. heart decision making). Overall, the findings show that there are statistically significant differences between the two groups’ that marketers can address in their marketing strategies during the recession.

Behavioural biases and information disclosure laws relating to residential property sales : narrowing the gap between existing laws and calls for future reforms

Market failures involving the sale of complex merchandise, such as residential property, financial products and credit, have principally been attributed to information asymmetries. Existing legislative and regulatory responses were developed having regard to consumer protection policies based on traditional economic theories that focus on the notion of the ‘rational consumer’. Governmental responses therefore seek to impose disclosure obligations on sellers of complex goods or products to ensure that consumers have sufficient information upon which to make a decision. Emergent research, based on behavioural economics, challenges traditional ideas and instead focuses on the actual behaviour of consumers. This approach suggests that consumers as a whole do not necessarily benefit from mandatory disclosure because some, if not most, consumers do not pay attention to the disclosed information before they make a decision to purchase. The need for consumer policies to take consumer characteristics and behaviour into account is being increasingly recognised by governments, and most recently in the policy framework suggested by the Australian Productivity Commission

Empirical Evidence Showing The Relationships Between Three Approaches for Pollution Control

Willingness to pay models have shown the theoretical relationships between the contingent valuation, cost of illness and the avertive behaviour approaches. In this paper, field survey data are used to compare the relationships between these three approaches and to demonstrate that contingent valuation bids exceed the sum of cost of illness and the avertive behaviour approach estimates. The estimates provide a validity check for CV bids and further support the claim that contingent valuation studies are theoretically consistent.

The relationship between deformity correction and clinical outcomes after thoracoscopic scoliosis surgery : a prospective series of 100 patients

The relationship between deformity correction and self-reported patient satisfaction after thoracoscopic anterior scoliosis surgery is unknown. Scoliosis Research Society questionnaire scores, radiographic outcomes, and rib hump correction were prospectively assessed for a group of 100 patients pre-operatively and at two years after surgery. Patients with lower post-op major Cobb angles report significantly higher SRS scores than patients with higher post-op Cobb angles.

AFM study of forces between silicon oil and hydrophobic - hydrophylic surfaces in aqueous solutions

An investigation has been made of the interactions between silicone oil and various solid substrates immersed in aqueous solutions. Measurements were made using an atomic force microscope (AFM) using the colloid-probe method. The silicone oil drop is simulated by coating a small silica sphere with the oil, and measuring the force as this coated sphere is brought close to contact with a flat solid surface. It is found that the silicone oil surface is negatively charged, which causes a double-layer repulsion between the oil drop and another negatively charged surface such as mica. With hydrophilic solids, this repulsion is strong enough to prevent attachment of the drop to the solid. However, with hydrophobic surfaces there is an additional attractive force which overcomes the double-layer repulsion, and the silicone oil drop attaches to the solid. A "ramp" force appears in some, but not all, of the data sets. There is circumstantial evidence that this force results from compression of the silicone oil film coated on the glass sphere.

Empowerment and role stress in the human interface between the firm and its markets

Frontline employees constitute one of the key interfaces that service organisations have with their markets. Many strategies to enhance the ability of these employees to satisfy the needs of customers have been proposed. Amongst these, empowering employees has been suggested to enhance the customer orientation of the firm and consequently its effectiveness in serving the market. However, the impact of empowerment in service organisations remains somewhat contentious. This paper examines the role of empowerments an organisational service strategy and identifies its consequences for role stress, job satisfaction and the willingness of service employees to serve their customers.

The relationship between culture, attitude, social networks and quality of life in midlife Australian and Taiwanese citizens

Objectives: The objectives of this study were to specifically investigate the differences in culture, attitudes and social networks between Australian and Taiwanese men and women and identify the factors that predict midlife men and women’s quality of life in both countries. Methods: A stratified random sample strategy based on probability proportional sampling (PPS) was conducted to investigate 278 Australian and 398 Taiwanese midlife men and women’s quality of life. Multiple regression modelling and classification and regression trees (CARTs) were performed to examine the potential differences on culture, attitude, social networks, social demographic factors and religion/spirituality in midlife men and women’s quality of life in both Australia and Taiwan. Results: The results of this study suggest that culture involves multiple functions and interacts with attitudes, social networks and individual factors to influence a person’s quality of life. Significant relationships were found between the interaction between cultural circumstances and a person’s internal and external factors. The research found that good social support networks and a healthy optimistic disposition may significantly enhance midlife men and women’s quality of life. Conclusion: The study indicated that there is a significant relationship between culture, attitude, social networks and quality of life in midlife Australian and Taiwanese men and women. People who had higher levels of horizontal individualism and collectivism, positive attitudes and better social support had better psychological, social, physical and environmental health, while it emerged that vertical individualists with competitive characteristics would experience a lower quality of life. This study has highlighted areas where opportunities exist to further reflect upon contemporary social health policies for Australian and Taiwanese societies and also within the global perspective, in order to provide enhanced quality care for growing midlife populations.

Poster : Understanding interactions between autonomous animal control and temperament when cattle are subjected to virtual fencing applications

Virtual fencing has the potential to control grazing livestock. Understanding and refi ning the cues that can alter behaviour is an integral part of autonomous animal control. A series of tests have been completed to explore the relationship between temperament and control. Prior to exposure to virtual fencing control the animals were scored for temperament using fl ight speed and a sociability index using contact logging devices. The behavioural response of 30, Belmont Red steers were observed for behavioural changes when presented with cues prior to receiving an electrical stimulation. A control and four treatments designed to interrupt the animal’s movement down an alley were tested. The treatments consisted of sound plus electrical stimulation, vibration plus electrical stimulation, a visual cue plus electrical stimulation and electrical stimulation by itself. The treatments were randomly applied to each animal over fi ve consecutive trials. A control treatment in which no cues were applied was used to establish a basal behavioural pattern. A trial was considered completed after each animal had been retained behind the cue barrier for at least 60 sec. All cues and electrical stimulation were manually applied from a laptop located on a portable 3.5 m tower located immediately outside the alley. The electric stimulation consisted of 1.0 Kv of electricity. Electric stimulation, sound and vibration along with the Global Position System (GPS) hardware to autonomously record the animal’s path within the alley were recorded every second.

Attitudes towards inclusion : gaps between belief and practice

General education teachers in the Republic of Korea were investigated regarding their participation in programs to include students with disabilities in general education settings. Previous studies have shown that even general education teachers with positive attitudes towards inclusion are reluctant in practice to have students with disabilities in their classrooms. This study examines 33 Korean general education teachers from three primary schools in Seoul regarding their attitudes towards, and willingness to accommodate, the needs of a student with a disability. The results show that 41.37% of general education teachers had positive attitudes towards inclusion programs, while 55.16% were unwilling to actually participate. Quantitative data obtained through a questionnaire was supplemented by qualitative data obtained through interviews. The interviews focused on the positive and negative effects of inclusion, as well as problems in implementing inclusive education programs. The findings will be discussed in the light of previous international research and will highlight links between the age and teaching experience of general education teachers and their negative attitudes towards inclusion.

Swimming between the flags: A preliminary exploration of the influences on Australians’ intentions to swim between the flags at patrolled beaches

Swimming at patrolled beaches reduces the likelihood of drownings and near-drownings. The present study tested the theory of planned behaviour (TPB), with the addition of risk perceptions, in predicting people’s intentions to swim between the flags at patrolled beaches. We examined also the predictors of people’s willingness to swim [1] up to 10 metres and [2] more than 10 metres outside of the patrol flags. Participants (N = 526) completed measures of attitudes, subjective norm, perceived behavioural control (PBC), intentions/willingness, and both objective and subjective risk perceptions. Two weeks later, a sub-sample of participants reported on their beach swimming behaviour for the previous fortnight. Attitude and subjective norm predicted intentions to swim between and willingness to swim outside of the flags. Age and PBC influenced willingness to swim beyond the flags. Objective risk predicted willingness to swim beyond the flags (both distances) while subjective risk predicted willingness to swim up to 10 metres outside the flags. People’s intentions to swim between the flags were correlated with their behaviour at follow-up. This study provides a preliminary investigation into an important safety behaviour and identifies factors to target when promoting safe swimming behaviours to prevent drowning deaths on Australian beaches.

Interaction between disinhibition and restraint: Implications for body weight and eating disturbance

An increase in obesity is usually accompanied by an increase in eating disturbances. Susceptibility to these states may arise from different combinations of underlying traits: Three Factor Eating Questionnaire (TFEQ) Restraint and Disinhibition. Two studies were conducted to examine the interaction between these traits; one on-line study (n=351) and one laboratory-based study (n=120). Participants completed a battery of questionnaires and provided self-report measures of body weight and physical activity. A combination of high Disinhibition and high Restraint was associated with a problematic eating behaviour profile (EAT-26), and a higher rate of smoking and alcohol consumption. A combination of high Disinhibition and low Restraint was associated with a higher susceptibility to weight gain and a higher sedentary behaviour. These data show that different combinations of Disinhibition and Restraint are associated with distinct weight and behaviour outcomes.