Strategies or Routines ? Knowledge Codification, Path-Dependence and the Evolution of Post-Acquisition Integration Practices in the U.S. Banking Industry

In a study of post-acquisition management practices in the U.S. commercial banking industry, we examine how firms codify their knowledge from previous acquisition experiences and routinize their post-acquisition decisions. We find that firms with higher levels of knowledge codification tend to integrate their acquired units more and to replace the existing top management team with higher probability. Also, acquirers tend to replicate their integration and resource replacement decisions irrespective of variations in the resource characteristics of their targets, suggesting strong tacit routinization effects.

The Impact of Knowledge Codification, Experience Trajectories and Integration Strategies on the Performance of Corporate Acquisitions

This study addresses the following questions: (1) can organizations learn how to manage infrequent and heterogeneous tasks ? (2) If they can, then what are the mechanisms that might explain learning under these circumstances ?, and (3) what are the limitations under which these mechanisms operate ? A model based on explicit knowledge codification and tacit experience accumulation is submitted and tested using data from a sample of 183 acquisitions in the US banking industry. Measures of post-acquisition integration strategies and of pre-acquisition resource characteristics are included in the model. We find that tacit knowledge accumulation significantly impacts performance when the experiences are highly homogeneous, and that knowledge codification improves acquisition performance in the context of high post-acquisition integration, i.e. when the organizational challenge is particularly complex. Also, the level of integration between the two firms involved in the acquisition positively influences performance, while the replacement of top managers in the acquired firm impacts performance in a negative fashion. Implications are drawn for organizational learning theory and for a knowledge-based view of corporate acquisitions.

Motivation and the theory of the firm

This paper proposes to revisit the debate on the theory of the firm using motivation theory as the primary analytical tool.theory of the firm; motivation theory

Experience Spillovers across Corporate Development Activities

This study develops a theoretical explanation for the existence of positive, as well as negative, experience spillovers across corporate development activities. We suggest that the similarity in two activities influences both the sign and magnitude of experience spillovers. The argument is used to understand how alliance experience influences the performance of acquisitions in the US commercial banking industry. The empirical evidence indicates that the spillover effect of alliance experience on acquisition performance is a function of the decisions made in the post-acquisition phase regarding the level of integration and the replacement of top management. We also find a U-shaped relationship between alliance experience and acquisition performance, suggesting the presence of negative spillovers across corporate development activities at low experience levels.

Knowledge Codification, Process Routinization, and the Creation of Organizational Capabilities: Post-Acquisition Management in the United States Banking Industry

How do firms create strategically relevant capabilities? In this study, insights from evolutionary economics and organizational learning theories are combined to explore the mechanisms behind the creation of organizational capabilities in the context of infrequent, heterogeneous, and complex administrative tasks. More specifically, the investigation covers the effects of both tacit and codified knowledge accumulation mechanisms on the development of a practice specialized in the management of post-acquisition integration processes. Hypotheses about the performance implications of pre-acquisition resources, post-acquisition integration decisions, and knowledge accumulation and codification processes are tested with primary data collected from a sample of 51 bank holding companies in the United States and Canada, for a total of 577 completed acquisitions. Results show that codification and routinization processes play a key role in shaping the evolution of post-acquisition integration practices, and that both mechanisms have a positive influence on acquisition performance, within specific limitations. The effectiveness of tacit knowledge accumulation is constrained by the degree of homogeneity of past experiences, whereas knowledge codification impacts performance only when high levels of integration are to be achieved. Results also show that greater level of integration have positive implications for acquisition performance and that decisions to replace top management affect performance negatively. Conclusions are drawn about necessary refinements of current theoretical approaches to accommodate complex learning conditions, and the potential implications for the management of acquisitions, as well as other infrequent and complex organizational events, such as strategic alliances and internal reorganizations, are discussed

Deliberate Learning and the Evolution of Dynamic Capabilities

This paper investigates the mechanisms through which organizations develop dynamic capabilities, defined as routinized activities directed to the development and adaptation of operating routines. It addresses the role of (1) experience accumulation, (2) knowledge articulation, and (3) knowledge codification processes in the evolution of dynamic, as well as operational, routines. The argument is made that dynamic capabilities are shaped by the coevolution of these learning mechanisms. At any point in time, firms adopt a mix of learning behaviors constituted by a semiautomatic accumulation of experience and by deliberate investments in knowledge articulation and codification activities. The relative effectiveness of these capability-building mechanisms is analyzed here as contingent upon selected features of the task to be learned, such as its frequency, homogeneity, and degree of causal ambiguity. Testable hypotheses about these effects are derived. Somewhat counterintuitive implications of the analysis include the relatively superior effectiveness of highly deliberate learning processes such as knowledge codification at lower levels of frequency and homogeneity of the organizational task, in contrast with common managerial practice

Assessment of DEM derived from very high-resolution stereo satellite imagery for geomorphometric analysis

ABSTRACTVery high-resolution satellite stereo images play an important role in cartographical and geomorphological applications, provided that all the processing steps follow strict procedures and the result of each step is carefully assessed. We outline a general process for assessing a reliable analysis of terrain morphometry starting from a GeoEye-1 stereo-pair acquired on an area with different morphological features. The key steps were critically analyzed to evaluate the uncertainty of the results. A number of maps of morphometric features were extracted from the digital elevation models in order to characterize a landslide; on the basis of the contour line and feature maps, we were able to accurately delimit the boundaries of the various landslide bodies

Systems approach in dynamic capabilities

The ontology of dynamic capabilities (DCs) is grounded in a systemic perspective of organisational strategy. In a controversial move, DCs theory adopts systems thinking as a metaphorical reference, not a possible research method. Systemic methodologies can provide a holistic management perception and guide managers to develop DCs differently, considering the deliberate learning and design process as a non-linear dynamism of causal loops. Calling attention to the conceptual origins, this work proposes a framework based on systemic methodologies to manage and develop organisational DCs. Based on two different systemic methodologies, the viable system model (VSM) and soft systems methodology (SSM), we integrate the systems approach of learning and design into DCs management guidelines

Variability and Trends in Streamflow in Northeast United States

Abstract There is general consensus that climate is undergoing change but whether climate change is occurring or not is still being debated in certain scientific, political, and religious quarters. Hydrologic variability influences the design of civil works and assessment of long-term climate change would help improve design criteria. To this end, long-term variability of streamflow was estimated using Shannon entropy. Three statistical tests were applied to determine trends in annual and seasonal daily streamflow with 5% two-sided confidence limit. Daily streamflow data spanning 70 years (from 1943 to 2012) from 669 stream gauge stations located in 23 states in the northeastern part of United States of America, covering six different water regions were employed. The time variability of annual and seasonal daily streamflow was assessed using the Mean Decadal Apportionment Disorder Index ( MDADI ). Analysis showed that in all cases minimum and maximum streamflows had higher variability than average and median streamflows. A significant number of stations exhibited trends. Considering annual minimum, average and median daily streamflows, approximately 50% of the stations followed trends and for almost all these stations trends were increasing. Only for annual maximum daily streamflow, 15% of the stations showed increasing trend and 10% decreasing trend. In terms of geographical distribution, the stations with increasing trend were essentially located along the Atlantic coast and near Great Lakes and in the Upper Mississippi Water Region. Similar considerations apply for seasonal time series as well