The multibusiness phenomenon beyond conglomerates and business groups : a corporate management perspective

Businesses and not multibusiness firms are the ones that compete. While each business needs its own competitive strategy, multibusiness firms require corporate management for capturing synergies. The competitive view has triggered the emergence of multiple businesses within a single firm. Despite this, it is common to find managers who are unaware of the benefits that joint management brings to the performance of a multibusiness company. Managing multibusiness firms implies facing a paradox: leveraging business uniqueness while creating joint value for the multibusiness company. This paper characterizes the multibusiness phenomenon from the existence of ownership ties and coordinated actions, by qualitatively researching 21 Colombian multibusiness firms. It contributes to the managerial knowledge of these types of firms in two different ways: by identifying the multibusiness phenomenon in a variety of companies, and by highlighting the benefits of the joint management of a multibusiness firm

Cross-divisional innovation in large, multi-divisional firms: Economic relevance and managerial actions

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A NEW CLASSIFICATION OF IT RESOURCES: A RESEARCH AGENDA UNDER THE COMPLEMENTARITY OF THE RBV

The effects of Information Technology (IT) on firm performance constitute one of the most recent lines of research. In developing this study, we take a Resource-Based View (RBV) as our basic theoretical focus. Adopting this paradigm means that IT alone is incapable of sustaining a competitive advantage (CA), making it necessary to analyze the existence of resources that complement IT to achieve greater organizational performance. The goal of this paper is to determine the combination of key resources, both exclusively IT resources and other organizational resources not necessarily belonging to this technology, to set a useful research agenda to contribute to the improvement of current knowledge of the IT effects on organizational performance.Information Technology, organizational performance, RBV.

IT Portfolio Selection and IT Synergy

This paper proposes the framework of IT portfolio selection and investigates the impact of IT synergy on a firm’s IT portfolio selection. IT resources can be distinguished from other forms of resources by their great potential of enhancing synergy between IT units. Based on prior discussion on types of IT synergy, we classify IT synergy into the three types and examine the effects of the different types of IT synergy on the IT portfolio selection. We found that firms of moderate and high risk tolerance are likely to obtain superior IT portfolio options by enhancing IT synergy, whereas firms of low risk tolerance may not benefit from enhancement of IT synergy

Encouraging emergence of cross-business strategic initiatives

Peer reviewedPostprin

IT Governance And Business Performance - A Resource Based Analysis

This dissertation project aims at developing a theory-based model that explains the positive impact of IT governance on the business performance of the firm. The research takes the perspective of the resource based view of the firm and integrates the economic theory of complementarities as well as the concept of relatedness. The increase of business performance is rooted in the generation of sustainable competitive advantage. The model is grounded on a thorough literature review and has been developed in eleven exploratory case studies with senior IT executives of major multinational corporations. The results propose that IT governance is positively related to business performance through the mediators IT relatedness and business process relatedness. It is argued that the latter two are complementary in the sense that they do not only increase business performance independently, but provide additional value if available in combination

Research Proposal

This research proposal shows that IT synergy is emerging as an important information systems research topic that is considered pertinent to the enduring research on the business value of IT. The proposal also puts forward the academic and practical significance of studying IT synergy. After a brief literature review, a tentative research model is proposed

Explicating Performance Impacts of IT Governance and Data Governance in Multi-Business Organisations

Achieving regulatory compliance, a 360 degree view on customer data, and an effective and efficient reporting are critical business requirements that can be traced back to a high quality of IT and data resources. Addressing these requirements, the regulation of decision rights and accountabilities for organisational decision-making about IT and data assets has become a key success factor for organisations. The aim of this paper is to analyse the performance impact of a combined IT and data governance concept. The study uses the resource-based perspective and integrates the theory of complementarities and the concept of relatedness. The proposed increase in business process performance is grounded in the generation of sustainable competitive advantages. The framework is developed by using nine exploratory case studies in multi-business organisations. The results suggest that IT and data governance are positively related with business process performance through the mediators of IT relatedness and data relatedness

The Complementarity of Corporate IT Alignment and Business Unit IT Alignment: An Analysis of Their Joint Effects on Business Unit Performance

Alignment between IT and business strategy is a perennial challenge for IT executives, in part due to the evolving nature of organizational structure. In multi-business organizations (MBOs), a pressing issue for IT executives is how to improve the performance of each strategic business unit (SBU). In this paper we examine how IT alignment in MBOs affects SBU performance. We distinguish between IT alignment at the corporate and SBU levels and propose that these two types of IT alignment are complementary and exert joint effects on SBU performance. Two hypotheses related to these joint effects are developed and tested using data collected from an international survey of IT executives. Our findings indicate that complementarities between corporate IT alignment and SBU IT alignment enhance SBU performance. The primary contribution of this paper is explaining how different types of IT alignment in MBOs - individually and jointly - affect SBU performance

International Differences in the Size and Roles of Corporate Headquarters: An Empirical Examination

This paper examines differences in the size and roles of corporate headquarters around the world. Based on a survey of over 600 multibusiness corporations in seven countries (France, Germany, Holland, UK, Japan, US, and Chile) the paper describes the differences among countries, and then applies a model of the factors determining the size of corporate headquarters (Young, Collis, and Goold, 2003) to systematically examine those differences. The data shows that there are significant differences among countries in the size and role of corporate headquarters, and strongly suggests the existence of a developing country model, a European model, a US model, and a Japanese model of corporate headquarters. Contrary to popular expectations, corporate headquarters in the US are about twice the size of European counterparts. Headquarters there exert a higher level of functional influence and have larger staffs in certain key areas, such as IT and R&D. US managers are generally more satisfied than their European counterparts with their larger more powerful headquarters which suggests that, at least in the US context, large corporate headquarters can create value. Japanese headquarters, as might have been expected, are substantially larger than elsewhere – a factor of four times larger than in Europe. However, those headquarters are becoming smaller because of dissatisfaction with their performance. It is clear that having headquarters the size of the Japanese firms in the survey is not conducive to value creation. More specifically, the evidence cannot refute a hypothesis that the slope of the relationship between firm size and the size of corporate headquarters is the same across all countries, but that there are significant differences in the intercept for Chile, the US, Japan, and the European countries. What the data indicates is that at a firm employing 20,000, a European corporate headquarters would on average employ 124 individuals, a US headquarters would have 255 employees, and Japan 467 employees. The paper also examines differences between countries in the extent to which they perform the two key corporate tasks of control and coordination. The US and Chile chose to be somewhat more interventionist in the traditional tools and processes used to monitor and control business units – setting strategy, budgets, and administering capital budgets. However, there was a significant difference in the degree of influence in operational affairs between countries. The US and Japan exerted far more influence than the other countries over every activity from IT and purchasing, to marketing, R&D and HR issues. The US was also found to have significantly larger legal, tax, and treasury functions than the common European model, perhaps reflecting a more legalistic institutional structure. Japan also has significantly larger tax, treasury, and corporate management functions, but overall was not that much larger than the common European model. While the causes of these observed differences cannot be directly determined from the research, suggestions are made that the institutional infrastructure, the size and homogeneity of the domestic market, and cultural factors within countries are important underlying drivers.