Private Equity: Antecedents, Outcomes, Mediators, and Moderators

As private equity’s financial heft and influence on the business landscape has intensified, so too has scholarly interest in the phenomenon. We review recent progress in private equity research, with a focus on the private equity industry’s later-stage buyout segment. To synthesize and integrate current findings, we construct a framework that encompasses not only antecedents and outcomes of private equity’s activities, but also mediators and moderators of the relationships that drive these outcomes. Based upon the gaps and learning opportunities that are surfaced by this framework, we develop recommendations for future private equity research. The proposed research agenda is particularly germane to management scholars, whose theories and perspectives have thus far been productively, yet relatively sparingly, applied in private equity research

Learning and innovation: Exploitation and exploration trade-offs

a b s t r a c t a r t i c l e i n f o This paper examines the relationship between learning and innovation outcomes, focusing on the trade-off between exploitation and exploration in learning and innovation. The study identifies two types of learning and two outcomes of innovation. Exploitation and exploration in learning are inversely associated with innovation rates and impact. While exploitative, localized learning is positively associated with innovation rates, but negatively associated with impact, exploratory learning-by-experimentation shows the opposite relationship. The study examines panel data of 103 companies in the global pharmaceutical industry over a 7-year period in an empirical test of our hypotheses. Results support the existence of the exploitation and exploration trade-off

Old Is Gold? The Value of Temporal Exploration in the Creation of New Knowledge

In this paper, knowledge creation is considered as a path-dependent evolutionary process that involves recombining knowledge spread over time. The findings of the paper suggest that a balance in combining current knowledge with the knowledge available across large time spans is an important factor that explains the impact of new knowledge. These ideas are empirically tested using patent data from the pharmaceutical industry. Results from the analysis offer support for the hypotheses developed in the paper.innovation, knowledge creation, temporal search

The development of technological competence within firms: An evolutionary perspective

The R&D function of the firm is thought of as a \u27black box\u27 process by scholars in both economics and strategic management. This dissertation shows that there is considerable potential in making the R&D function more transparent and that it is possible to model the intertemporal emergence of technological competence where technological competence, defined as the ability of a firm to create new products and processes, is a pioneering empirical investigation of concepts introduced to strategic management literature by Nelson and Winter (1982), Dierickx and Cool (1989) and Teece, Pisano and Shuen (1994). The central theme of this dissertation is to show that firms build technological competence in a path dependent manner and that this path dependence varies across firms. Firms demonstrate persistence in their research efforts which leads to their acquiring competence in the direction of these efforts. Further, this persistence in research efforts or outputs is a result of persistence in research inputs. This dissertation identifies three research inputs: research engines, knowledge domains and geographic location of knowledge. It offers empirical evidence of this persistence at both input and output levels within firms and goes on to suggest that differentials in persistence at input level translate into differentials at output level and consequently to differentials in technological performance of firms. This dissertation primarily uses patent data gathered on more than 100 firms from three industrial sectors viz. chemical, pharmaceutical and engineering and a smaller data set gathered on the optical disc technology industry. The techniques used include simulation, modified correlation analysis, survival analysis, and time series data analysis

The impact of global and local cohesion on innovation in the pharmaceutical industry

In this paper, we examine how the configuration of intraorganizational networks, and in particular, cohesion among members of an organization, influences organizations' innovative output. We argue that the cohesion among R&D scientists could be at a local level or a global level, and that local and global cohesion may have different impacts on firms' innovation performance. We test our hypotheses by examining the structure of the R&D collaboration networks within firms that operated in the pharmaceutical industry between 1981 and 1989, and their innovative outcomespatents that led to new product launches. We find that local cohesion has a positive impact on the innovative performance of a firm, and global cohesion has a negative impact

The development of technological competence within firms: An evolutionary perspective

The R&D function of the firm is thought of as a \u27black box\u27 process by scholars in both economics and strategic management. This dissertation shows that there is considerable potential in making the R&D function more transparent and that it is possible to model the intertemporal emergence of technological competence where technological competence, defined as the ability of a firm to create new products and processes, is a pioneering empirical investigation of concepts introduced to strategic management literature by Nelson and Winter (1982), Dierickx and Cool (1989) and Teece, Pisano and Shuen (1994). The central theme of this dissertation is to show that firms build technological competence in a path dependent manner and that this path dependence varies across firms. Firms demonstrate persistence in their research efforts which leads to their acquiring competence in the direction of these efforts. Further, this persistence in research efforts or outputs is a result of persistence in research inputs. This dissertation identifies three research inputs: research engines, knowledge domains and geographic location of knowledge. It offers empirical evidence of this persistence at both input and output levels within firms and goes on to suggest that differentials in persistence at input level translate into differentials at output level and consequently to differentials in technological performance of firms. This dissertation primarily uses patent data gathered on more than 100 firms from three industrial sectors viz. chemical, pharmaceutical and engineering and a smaller data set gathered on the optical disc technology industry. The techniques used include simulation, modified correlation analysis, survival analysis, and time series data analysis

Capabilities in Conflict? The Fallacy of Sameness between Divestitures and Acquisitions and Its Ramifications for Firm Capability Development and Deployment

Are divestitures really just the “flip side” of acquisitions? Both divestiture and acquisition are important processes for firm scope change. Frequently, these processes are considered to be “two sides of the same coin” wherein a divestiture is simply an acquisition performed “in reverse.” In contrast to this perspective, the authors submit that these two corporate strategic processes have fundamental differences in their motivations, implementation, and ramifications. Failure to recognize and address these differences could have serious consequences for firms, especially in the domains of capability development and deployment. In this chapter, the authors begin by recognizing the similarities between divestitures and acquisitions that have contributed to their “mirror image” reputations. The authors then identify and categorize the major differences between divestitures and acquisitions and explain how these distinctions can present significant challenges to firms when building and utilizing their corresponding divestiture and acquisition capabilities. Finally, the authors leverage these insights to develop not only suggestions for future research but also recommendations for firms to avoid succumbing to the fallacy of sameness between divestitures and acquisitions – and perhaps even successfully exploit it – when building, wielding, and honing the tools in their capability portfolios

Pipes, Prisms and Patent Sales: How Personal Wealth Expands and Contracts the Gender Gap in Entrepreneurship

Research Summary: This study investigates whether there is a gender gap in the sale of patents by entrepreneurs and examines whether the personal wealth of female entrepreneurs can compensate for it. Using a sample of 107,697 independent inventors, we overcome the empirical challenge of measuring wealth through a novel approach that leverages Zillow data. We find strong evidence of a gender gap in patent sales, and find it poses a cruel irony for female entrepreneurs. While greater wealth of female entrepreneurs improves their likelihood of patent sale, increasing wealth simultaneously expands the gender gap, making female entrepreneurs increasingly worse off relative to male entrepreneurs except at high affluence. These results underscore the complexity of the challenges facing female entrepreneurs seeking to commercialize using patent sales. Managerial Summary: Are female entrepreneurs disadvantaged in monetizing their inventions, relative to male entrepreneurs? Our study, which examines invention commercialization through selling patents, suggests the answer is yes. We begin by evidencing the gender gap in patent sales, showing that female inventors are 41.7% less likely to sell a patent than male inventors. We then investigate whether an entrepreneur′s personal wealth—a financial asset that also represents valuable intangible resources like network connections and competency signals—can help to close it. We find that wealth is a double-edged sword. Although greater wealth of female entrepreneurs improves their likelihood of patent sale, it can concurrently widen the gap, making them increasingly worse off versus male entrepreneurs. We offer concrete recommendations for closing the gender gap in patent sales.</p