Change, Coordination, and Capabilities

Empirical studies on coordination of economic activities focused on the two polar cases of governance mode, namely vertical integration and market exchanges. Whether firms should be vertically integrated or lever market exchanges in the face of change is, however, debated. Two positions have emerged. Some scholars argue that the vertically integrated firm is the appropriate mode of coordination when change occurs, while market exchanges are more appropriate for dealing with stable contexts (Teece, 1996). On the other hand, Harrigan (1984, 1985) contends that firms should rely on market exchanges when technological change renders upstream capabilities obsolete. Based on two case studies of the aircraft engine industry, this paper introduces the concept of systems integration as the primary coordination mechanism in-between markets and hierarchies that firms employ to cope with change. The focus is on multitechnology settings. Multitechnology, multicomponent products intensify the coordination efforts for firms developing them and therefore provide a vantage point to study coordination modes in the face of technological change. The paper argues that systems integration, as a coordination mechanism, comprises a set of different technological and organizational skills, ranging from component assembly through the understanding and integration of the technological disciplines underlying a product, to project management. It shows that from a competitive point of view, systems integration is most appropriately understood as knowledge integration. Systems integrating firms are understood as those organizations that set up the network of actors involved in the industry and lead it from an organizational and technological viewpoint.technological change, systems integration, knowledge integration, vertical integration, market exchanges

Making Design Rules: A Multi-Domain Perspective

This study analyzes the processes whereby organizations develop radical innovations in response to environmental transformations. It explores the changes in organizational structures, practices and business strategies entailed by the implementation of such innovations. From the literature on modularity, we borrow the idea that the evolutionary dynamics of artifacts and organizations are linked by design rules, i.e. a set of principles that allocate functions to components, identify the operating principle of each component and determine the interfaces among modules. Through an in-depth case study of radical innovation in tire manufacturing, we study the joint dynamics of technical and organizational change during the transition from old to new design rules. We argue that technical change and organization adaptation are linked, but that such relationship is mediated and rendered open-ended by the evolution of the underlying bodies of knowledge.organizational change, innovation, technological change, modularity, tire manufacturing

Regions Matter How Regional Characteristics Affect External Knowledge Acquisition and Innovation

To introduce new products and processes, firms often acquire knowledge from other organizations. Drawing on social capital and transaction cost theory, we argue that not only is the impact of such acquisitions on the successful development of product and product innovations dependent on strategic and economic variables, it may also be contingent on the “knowledge characteristics” of the geographical area in which the firm is located. Combining data on social capital at the level of 21 regions with a large scale data set on innovative activities by a representative sample of 2464 Italian manufacturing firms, we find — after controlling for a large set of firm and regional characteristics — that being located in regions characterized by high levels of social interaction leads to a higher propensity to innovate. In addition, being located in an area characterized by a high degree of social interaction positively moderates the effectiveness of externally acquired R&D on innovation inclination.Social capital; external acquisition; process innovation; product innovation

The Value and Costs of Modularity: A Cognitive Perspective

This paper discusses the issue of modularity from a problem-solving perspective. Modularity is in fact a decomposition heuristic, through which a complex problem is decomposed into independent or quasi-independent sub-problems. By means of a model of problem decomposition, this paper studies the trade-offs of modularity: on the one hand finer modules increase the speed of search, but on the other hand they usually determine lock-in into sub-optimal solutions. How effectively to balance this trade-off depends upon the problem environment and its complexity and volatility: we show that in stationary and complex environments there exists an evolutionary advantage to over-modularization, while in highly volatile – though “simple” – en- vironments, contrary to usual wisdom, modular search is inefficient. The empirical relevance of our findings is discussed, especially with reference to the literature on system integration.modularity, problem solving, complex systems

The Economics Of System Integration: Toward An Evolutionary Interpretation.

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To Cloud or not to Cloud. Strategic choices and IT governance in the digital transformation of a University

One late evening on 21st March 2015, Francesca \u2013 Head of Research and Teaching office at The University \u2013 ran the meeting and was hoping that the information and insights collected enabled her to make the right decision. She initiated the meeting by telling the story that few days ago on 15th March, during the presentation of a new digital solution for universities by MG company, she realized how different can be the instructors\u2019 practices in managing teaching materials and interacting with students. She gave examples of tools and functions used by University instructors such as personal webpages, blogs, Moodle, Dropbox, Google Drive, iTunes, WordPress, Facebook groups, Blackboard, etc. Francesca knew how important innovation is in a competitive higher education market. Therefore, Francesca has always been supportive on teaching experiments made by instructors. For instance, in 2007, she encouraged the Information Systems (IS) research group at University in adopting Moodle as a Learning Management System (LMS) for their IS courses. In 2014, the positive feedback collected from both students and instructors who used Moodle, led Francesca to pilot the system at University level. Simone, a member of the IS group, was in charge of the implementation and received full support from the IT Office. After one year, the new learning platform was available for any instructor interested in experimenting the Moodle functionalities. However, during the last exam session, the learning platform was down for few hours. Not only students were unable to access the teaching materials to prepare for the exams, but also professors were unable to assess students works! \u201cWhy not having one platform to support all our teaching practices? One channel to interact with our students\u201d she said. She asked for inputs and insights from a team of experts before making a decision. Francesca\u2019s idea was to have a single Learning Management System (LMS) supporting more than 60 programs in the four University departments. Now the problem was to select a proper technological solution, fitting with the needs of both students and instructors, and also reducing the risk of downtime. Especially knowing that many instructors will not be happy to standardize their practices, she wondered how to convince them to use the new system

Management Research that Makes a Difference:Broadening the Meaning of Impact

The world is undergoing dramatic transformations. Many of the grand societal challenges we currently face underscore the need for scholarly research – including management studies – that can help us best sort out and solve them. Yet, management scholars struggle to produce concrete solutions or to communicate how their research can help to tackle these grand societal challenges. With this editorial, we want to help scholars seeking to ‘make a difference’ by broadening our understanding of what constitutes impactful research. We examine five forms of impact – scholarly, practical, societal, policy, and educational – outlining how scholars can systematically extend or enlarge their research agenda or projects to amplify their impact on the challenges societies face. We suggest that each of these forms of impact has intrinsic value in advancing the scientific enterprise and, together, can help to address key societal problems that reach beyond the immediate and traditional context of business management. With concrete suggestions for getting started on these forms of impact, and possible outputs for each, we hope to stimulate management and organization scholars to think more broadly about the opportunities for making an impact with their research and to begin doing so more often

Dinamiche evolutive delle imprese familiari: il ruolo del capitale umano e del capitale sociale nel ricambio generazionale

This paper aims to shed new light on the effects of social capital and human capital on family firms\u2019 succession. Drawing on theory on family firms, we identify three succession models: conservative, wavering and proactive. Empirically, we adopt a multiple case study approach involving a theoretical sample of six family firms. From our research, we conclude that the successor\u2019s level of social capital and human capital contributes in defining the succession model adopted by the firm. This study contributes to bridge literature on family firm with social capital and human capital theories and provides some insights for managers and entrepreneurs that are approaching the succession process

How Regional Characteristics Affect External Knowledge Acquisition and Innovation

To introduce new products and processes, firms often acquire knowledge from other organizations. Drawing on social capital and transaction cost theory, we argue that not only is the impact of such acquisitions on the successful development of product and product innovations dependent on strategic and economic variables, it may also be contingent on the "knowledge characteristics” of the geographical area in which the firm is located. Combining data on social capital at the level of 21 regions with a large scale data set on innovative activities by a representative sample of 2464 Italian manufacturing firms, we find — after controlling for a large set of firm and regional characteristics — that being located in regions characterized by high levels of social interaction leads to a higher propensity to innovate. In addition, being located in an area characterized by a high degree of social interaction positively moderates the effectiveness of externally acquired R&D on innovation inclination