How does the presence of domain experts on a corporate board—directors whose primary professional experience is within the focal firm's industry—affect organizational outcomes? We argue that under conditions of significant decision uncertainty, a higher proportion of domain experts on a board may detract from effective decision making and thus increase the probability of organizational failure. Building on exploratory interviews with board members and CEOs, we derive hypotheses from this argument in the context of local banks in the United States. We predict that the greater the level of decision uncertainty—due to rapid asset growth or operation in less predictable markets—the stronger the relationship between the proportion of banking expert directors and the probability of bank failure. Longitudinal analyses of 1,307 banks between 1996 and 2012 support this prediction, even after accounting for both the overall level of professional diversity among directors and banks' different propensities to have an expert-heavy board. We discuss implications for the key dimensions of board composition, the conditions under which the professional background of directors is more or less consequential, and the mechanisms whereby board composition affects organizational outcomes.

Social welfare, or the good society, is of central concern to the Academy of Management. In this paper, we review the concept of social welfare, suggesting that regardless of discipline, social welfare is defined as a multi-dimensional phenomenon. We then review the literature on the corporate objective within a market economy, where the dominant view is that of a single-objective function. Analyzing this view, we argue for a multi-dimensional objective for organizations in order to meet social welfare objectives: where decision making within a market economy better utilizes the benefits of markets. We suggest that improvements in social welfare are possible where markets are better-enabled to operate among stakeholders unconstrained by some single-valued objective. In doing so, we respond to the critics of stakeholder theory who argue that it is an untenable theory due to its inability to specify how stakeholder objectives are to be prioritized.

Agency theory-grounded research on boards of directors and firm legitimacy has historically viewed CEO power as de-legitimating, often taking this fact for granted in theorizing about external assessors' evaluations of a firm. With few exceptions, this literature has focused exclusively on capital market participants (e.g., investors, securities analysts) as the arbiters of a firm's legitimacy and has accordingly assumed that legitimate governance arrangements are those derived from the shareholder-oriented prescriptions of agency theory. We extend this line of research in new ways by arguing that customers also externally assess firm legitimacy, and that firms potentially adjust their governance characteristics to meet customers' norms and expectations. We argue that the cultural-cognitive institutions prevalent in customers' home countries influence their judgments regarding a firm's legitimacy, such that firms competing heavily in high-power distance cultures are more likely to have powerful CEOs, with CEO power a source of legitimacy—rather than illegitimacy—among customers. We also argue that the more dependent a firm is on its customers and the more salient cultural power distance is as a demand-side institutional norm, the greater this relationship will be. Data from 151 U.S. semiconductor and pharmaceutical firms over a 10-year period generally support our predictions.

Despite the extensive research into the effects of reputation, virtually all of this research has examined the effect of one type of reputation on one or more specific outcomes. In this study we ask the question: How do the reputations of analysts, CEOs, and firms individually and jointly affect firm outcomes? To answer this question we focus on a context where reputations are particularly relevant - changes in analyst recommendations and the effect of those changes on stock market reactions. Our study makes contributions to the growing reputation literature by being one of the first studies to recognize and measure how the market accounts for multiple reputations. Further, we argue and find that the reputations of different actors interact with each other when determining particular firm outcomes. We find that different actor's reputations influence the reactions of observers.

A key finding in the literature on industry evolution and strategy is that knowledge "inherited" from the founder's previous employer can be an important source of a new firm's capabilities. We analyze the conditions under which knowledge that is useful for carrying out a key value chain activity is inherited, and explore the mechanism through which such an inheritance shapes an entrant's strategies and, in the process, influences its performance. Evidence from the early U.S. auto industry indicates that employee spinoffs generated from incumbents that had integrated a key value chain activity were also more likely to integrate that activity than other entrants, which, we suggest, reflects the application of knowledge inheritance relative to that activity. Moreover, we find that the integration of this key activity, stimulated by knowledge inheritance, contributed to the establishment of defensible strategic positioning, thereby enhancing the survival duration of inheriting spinoffs. We thus link together the phenomena of knowledge inheritance, vertical integration, and strategic positioning to explain entrant performance. These three phenomena tend to be treated disparately in the literature, rather than in combination.

In order to acquire resources, new ventures need to be perceived as legitimate. For this to occur, a venture must meet the expectations of various audiences with differing norms, standards, and values as the venture evolves and grows. We investigate how the organizational identity of a technology venture must adapt to meet the expectations of critical resource providers at each stage of its organizational life cycle. In so doing, we provide a temporal perspective on the interactions between identity, organizational legitimacy, institutional environments, and entrepreneurial resource acquisition for technology ventures. The core assertion from this conceptual analysis is that entrepreneurial ventures confront multiple legitimacy thresholds as they evolve and grow. We identify and discuss three key insights related to entrepreneurs' efforts to cross those thresholds at different organizational life cycle stages: institutional pluralism, venture-identity embeddedness and legitimacy buffering.

In a series of qualitative and quantitative studies, we developed a model of the functions of positive work relationships, with an explicit focus on the role that these relationships play in employee flourishing. Stories that employees told about positive relationships at work revealed that relationships serve a broad range of functions, including the traditionally-studied functions of task assistance, career advancement, and emotional support, as well as less studied functions of personal growth, friendship, and the opportunity to give to others. Building on this taxonomy, we validated a scale - the Relationship Functions Inventory - and developed theory suggesting differential linkages between the relationship functions and outcomes indicative of employee flourishing. Results revealed unique associations between functions and outcomes, such that task assistance was most strongly associated with job satisfaction, giving to others was most strongly associated with meaningful work, friendship was most strongly associated with positive emotions at work, and personal growth was most strongly associated with life satisfaction. Our results suggest that work relationships play a key role in promoting employee flourishing, and that examining the differential effects of a taxonomy of relationship functions brings precision to our understand of how relationships impact individual flourishing.

"Best Places to Work" (BPTW) and similar competitions are a proliferating form of third party employment branding. Little is known, however, about how single or repeated third party employment branding occurrences relate to key human capital outcomes. Extending signaling theory by considering signal credibility and comparability, we use archival and survey data from 624 BPTW participants in sixteen competitions across a three-year period to develop and test hypotheses linking BPTW certifications to collective turnover rates and key informant perceptions of applicant pool quality. We find that certifications are associated with lower turnover rates, and in addition, propose competing crystallization and celebrity hypotheses that model turnover trajectories with repeated certifications, finding diminishing marginal turnover reductions across multiple certifications. We also examine company size and industry job opening moderators, finding that as certifications increase, applicant pool quality is (1) higher in smaller companies and (2) higher when job openings are scarcer. Finally, beyond being certified or not, we find supplemental evidence for effects of the specific certification level achieved (e.g., 2nd versus 15th). This investigation advances theory related to collective turnover, applicant pool quality, and employment branding, and is relevant to company decisions about seeking or re-seeking third party certifications.

Despite recognizing the importance of personal identification in organizations, the literature has rarely explored its dynamics. We define personal identification as perceived oneness with another individual, where one defines oneself in terms of the other. While many scholars have found that personal identification is associated with helpful effects, others have found it harmful. To resolve this contradiction, we distinguish between three paths to personal identification -threat-focused, opportunity-focused, and closeness-focused - and articulate a model that includes each. We examine the contextual features, how individuals' identities are constructed, and the likely outcomes that follow in the three paths. We conclude with a discussion of how the threat-, opportunity-, and closeness-focused personal identification processes potentially blend, as well as implications for future research and practice.

We argue that employees who perceive that they are provided with a safe climate at work within which to voice their concerns and suggestions about work-related issues or problems will not only be more engaged employees but will also be likely to be more engaged and involved members of their communities. By focusing on the importance of employee voice opportunities, in work organizations, we seek to build our understanding of how to create "positive" organizations that contribute to the building of human potential, both inside the organizational setting and outside in our communities and societies. We also consider how employee voice opportunities in for-profit organizations may be influenced by the law and prevailing attitudes about corporate governance.

This article extends the understanding of what impels buyers to contact particular sellers in online business-to-business (B2B) marketplaces, which are typically characterized by sparse social structures and concomitant limitations in observing social cues. Integrating an institutional perspective with signaling theory, our core argument is that offline seller characteristics that are visible online—in particular, geographic location and legal status—convey credible signals of seller behavior because they provide buyers with information on sellers' local institutional quality and the institutionally-induced obligations and controls acting on sellers. Using unique data from a large Italian online B2B marketplace between the fourth quarter of 1999 and July 2001, we find that both sellers' local institutional quality and their legal statuses affect a buyer's likelihood of contacting a seller. Moreover, consistent with the idea that a buyer's own local institutional quality generates a relevant reference point against which sellers are evaluated, we find that a buyer is progressively more likely to contact sellers the higher their local institutional quality relative to the buyer. Jointly, our findings imply that in online B2B marketplaces, signals conveyed by sellers' geographic locations and legal statuses may be substantive sources of competitive heterogeneity and market segmentation.

We study the effects of actors' audience-specific reputations on their levels of success with different audiences in the same field. Extending recent work that has emphasized the presence of multiple audiences with different concerns, we demonstrate that considering audience specificity leads to an improved understanding of reputation effects. Using data on emerging artists in the field of contemporary art from 2001 to 2010, we investigate the manner in which artists' audience-specific reputations affect their subsequent success with two distinct audiences: museums and galleries. Our findings suggest that audience-specific reputations have systematically different effects with respect to success with museums and galleries. Our findings also illuminate the extent to which audience-specific reputations are relevant for emerging research on the contingent effects of reputation. In particular, our findings support our predictions that audiences differ from one another in terms of the extent to which other signals (specifically, status and interaction with other audiences) enhance or reduce the value of audience-specific reputations. Our study thus advances theory by providing empirical evidence for the value of incorporating audience-specific reputations into the general study of reputation.

Research about the effects of an organization's general reputation following a negative event remains equivocal: Some studies have found that a high reputation is a benefit because of the stock of social capital and goodwill it generates; others have found it to be a burden because of the greater stakeholder attention and violation of expectations associated with a negative event. We theorize that stakeholders' level of organizational identification helps explain which mechanisms are more dominant. We test our hypotheses on a sample of legislative references associated with NCAA major infractions from 1999-2009. Our results indicate that a high reputation is a burden for an organization when considering low-identification stakeholder support: As the number of legislative references increases, a high-reputation university will receive fewer donations from non-alumni donors than universities without this asset. In contrast, a high reputation is a benefit when considering high-identification stakeholder support: As the number of legislative references increases, a high-reputation university will receive more donations from alumni donors than universities without this asset. However, an exploratory investigation reveals that alumni donations to high-reputation universities decline as the number of legislative references increases, suggesting that the benefit of a high reputation has a limit.

The law of requisite variety is widely employed in management theorizing, and is linked with core strategy themes such as contingency and fit. We reflect upon requisite variety as an archetypal borrowed concept. We contrast its premises with insights from institutional and commitment literatures, draw propositions that set boundaries to its applicability, and review the ramifications of what we term "complexity misalignment." In this way, we contradict foundational assumptions of the law, problematize adaptation- and survival-centric views of strategizing, and theorize the role of human agency in variously complex regimes.

In this paper, we critically assess how the devolution of researcher care moderates knowledge development in organization studies. Defining researcher care as what scholars are concerned and passionate about, we consider the extent to which individuals researchers lose their personal voice in researching organizations. This bounding of care by the research community is a reflection of the way that researchers knowingly alter their care in researching organizations to gain associated career and reputational benefits. We describe how the field's institutional logic for researching organizations enables this devolution to take hold and how larger institutional forces reinforce how it progressively moderates organizational knowledge. We offer preliminary suggestions for addressing the devolution of researcher care in organization studies and ameliorating its threat to knowledge development.

Research concerning why and how to promote social interaction and learner reflection in management education and training is somewhat underdeveloped. In this investigation, we used a predictive, quasi-experimental design with 246 students from a business school in Colombia who were enrolled in 10 sections of a leadership course to examine expected effects of instructional methods that promoted different levels of social interaction and reflection on self-reported learning behaviors (dialogue and reflection activities), self-efficacy for class performance, and instructors' assessments of students' skill demonstration (team work, communication, influence, and work proficiency and effort). In comparisons to students participating in instructional conditions with less social interaction and fewer reflective activities, students participating in an instructional condition that promoted higher levels of these activities exhibited considerably greater student-student dialogue, instructor-student dialogue, and reflection. These learning behaviors in turn led to enhanced self-efficacy for class performance and skilled activity. In addition, students' perceptions of psychological safety partially mediated relationships between instructional method and dialogical and reflective activities. The implications of these findings for coupling action, dialogue and reflective activities in management education and training as well as avenues for future research are discussed.

This article examines the conditions under which organizations publicly respond to unfavorable consumer evaluations that challenge their market identity. Because organizations' market identities are certified by expert evaluations, consumers' devaluations that challenge these expert evaluations represent an identity threat. However, organizations do not always react to consumers' devaluations because of the risks associated to public responses. Hence, we first predict that organizations are more likely to respond to severe devaluations than to weaker ones; second, we propose that organizations, when faced with severe devaluations, are more likely to craft responses that justify their actions and behaviors. We further contend that, for any market identity under consideration, an organization's reputation amplifies these relationships. Analyses of a dataset of London hoteliers' responses to online reviews posted on TripAdvisor during the period 2002-2012 lend substantial support to our hypotheses.

This paper examines when firms pursue structural realignment through the recombination of business units. Our results refine and extend contingency theory and studies of organization design by drawing on theories of decision avoidance and delay to describe conditions when firms pursue or postpone structural realignment. Our empirical analysis of 46 firms from 1978 to 1997 operating within the U.S. medical device and pharmaceutical sectors demonstrates that while decision makers initiate structural recombination during periods of industry growth (i.e., munificence), they reduce their recombination efforts during periods of industry turbulence (i.e., dynamism) and managerial turbulence (i.e., growth in top management team size). We also find evidence that firms delay realignment and bide their time for better environmental conditions of declining turbulence and industry growth before pursuing more structural realignment. Together, these findings suggest that decision makers often delay initiating structural recombination until they can effectively process information and assess how structural changes will help them realign the organization to the environment.

Exit is a critical part of the entrepreneurial process. At the same time, research indicates that founders are likely to form strong identity connections to the organizations they start. In turn, when founders exit their organizations, the process of psychological disengagement might destabilize their identities. Yet, limited research addresses how founders experience exit or how they manage their identities during this process. Through a qualitative, inductive study of founders of technology-based companies, I developed a theoretical model of founder psychological disengagement that delineates how founder work orientations relate to the disengagement paths that founders follow when leaving one organization and starting another. In elaborating theory on psychological disengagement, this study has implications for understanding the psychology of founders, how founders exit and begin again, and psychological disengagement, more broadly.

The work life of misfits - employees whose important values are incongruent with the values of their organization - represents an under-researched area of the person-environment fit literature. The unfortunate reality is that these individuals are likely to be disengaged and unproductive at work. In this manuscript, we entertain the possibility that employees can protect themselves from this situation if they engage in alternative actions that supplement the fundamental needs that go unmet from value incongruence. We integrate theorizing about the motivational role of need fulfillment and work/non-work behaviors in order to examine whether two actions in particular - job crafting and leisure activity - can potentially mitigate the negative effects of value incongruence on employee performance. In a field study of employees from diverse organizations and industries, the results suggest that both job crafting and leisure activity indeed act as a buffer, mitigating the otherwise negative effects of value incongruence on employee engagement and job performance (both task performance and citizenship behavior).

This study draws on social identity theories of behavioral contagion and research concerning narratives in organizations to present and test a framework for understanding how narratives embed values in organizational newcomers' actions. Employing a field experiment using 632 newly-hired employees in a large IT firm that prioritizes self-transcendent values, this study explores how narratives varying in terms of the organizational level of main characters and the values-upholding or values-violating behaviors of those characters influence newcomers' tendencies to engage in behaviors that uphold or deviate from the values. Results indicate that stories about low-level organizational characters engaging in values-upholding behaviors are more positively associated with self-transcendent, helping behaviors and negatively associated with deviant behaviors, than are similar stories about high-level members of the organization. Stories in which high-level members of the organization violate values are negatively related to newcomers' engagement in both helping and deviance more strongly than are values-violating stories about lower-level members. Content analyses of the stories suggest that they convey values in different and potentially important ways. Implications, future directions, and limitations are discussed.

Book Review

Do you teach anyone whom you would consider a member of the next generation of global leaders? If you answered "yes" to this question, you likely teach an audience within which many of its members already possess intercultural experience, have traveled widely, and perhaps speak several languages. These globally minded students demand in-depth learning approaches which help them prepare for complex global leadership settings. Global Leadership Practices is an excellent source of teaching materials and tools targeted to these learners.

This book centers on the author's discovery, and moral disapproval, of expedient arrangements adopted by American firms in China, through which 'middlemen', operating as independent agents, pay bribes as part and parcel of the troublesome process of negotiating and clinching business deals there.

Over the past decade, the terms "crisis" and "crisis management" have become increasingly popular topics of interest for business professionals and management academics alike. According to the Institute for Crisis Management (2013), "Newsworthy business crises have been on a steady upward trend since 2009.

In Strategic Corporate Social Responsibility (3rd edition) (SCSR), David Chandler and William B. Werther Jr. advance the view that the ability of firms to create value for a range of stakeholders over the medium- and long-term requires that they embed CSR into their strategies and operations. Its focus on the integration of CSR into strategic planning and implementation distinguishes SCSR from competing business and society textbooks, which tend to survey the field or focus on the management of the firm's relationships with stakeholders and society.

We examine when and why creative role identity causes entitlement and unethical behaviors and how this relationship can be reduced. We found that the relationships among the creative identity, entitlement, and dishonesty are contingent on the perception of creativity being rare. Four experiments showed that individuals with a creative identity reported higher psychological entitlement and engaged in more unethical behaviors. Additionally, when participants believed that their creativity was rare compared to common, they were more likely to lie for money. Moreover, manipulation of rarity of creative identity, but not practical identity, increased psychological entitlement and unethical acts. We tested for the mediating effect of psychological entitlement on dishonesty using both measurement of mediation and experimental causal chain approaches. We further provide evidence from organizations. Responses from a sample of supervisor-subordinate dyads demonstrated that employees reporting strong creative identities who perceived creativity as rare in their work-group rather than common were rated as engaging in more unethical behaviors by their supervisors. This paper extends prior theory on negative moral consequences of creativity by shedding new light on assumption regarding the prevalence of creativity and the role psychological entitlement plays.

Studies suggest that category-spanning organizations receive lower evaluation and perform worse than organizations focused on a single category. We propose that (1) these effects are contingent on clients' theory of value and that as clients expect more sophisticated services, they tend to value category spanners more positively and (2) the evaluation of producers mediates the relationship between category spanning and performance. We test our hypotheses using original data on corporate legal services in three markets (London, New York City, and Paris) over the decade 2000-2010. We find that (1) category spanners receive a better evaluation, and more so when their categorical combination is more inclusive and (2) evaluation mediates significantly the relationship between category spanning and performance. This study enriches our understanding of how audiences apprehend a whole market category system and why organizations span categories.

Organizational theorists are increasingly interested in the antecedents of terminating interorganizational relationships, but have paid little attention to the disruptive consequences of such terminations on future tie formation. To redress this imbalance, the present study focuses on how venture capital (VC) firms' withdrawals from VC syndicates are associated with their subsequent syndication over the 1985 through 2008 period. We argue that withdrawals disrupt the relationships of the withdrawing VC firms with the coinvestors and reduce the likelihood of them entering into subsequent exchange (relational consequences). Furthermore, public information on the withdrawals can undermine the withdrawing VC firm's reputation for reliability, making it a less desirable exchange partner overall (global reputational consequences). Finally, we find that abandoned coinvestors can spread negative, private information about the withdrawing firm, reducing its chances of syndication with their other network contacts (local reputational consequences). We also show that the global and local reputational consequences attenuate each other, due to redundancy in the content of information each provides. We discuss the implications of our theory for the research on network dynamics and reputation.

The number of constructs developed to assess workplace aggression has flourished in recent years, leading to confusion over what meaningful differences exist (if any) between the constructs. We argue that one way to frame the field of workplace aggression is via approach/avoidance principles, with various workplace aggression constructs (e.g., abusive supervision, supervisor undermining, and workplace ostracism) differentially predicting specific approach or avoidance emotions and behaviors. Using two multi-wave field sample of employees, we demonstrate the utility of approach/avoidance principles in conceptualizing workplace aggression constructs, as well as the processes and boundary conditions through which they uniquely influence outcomes. Implications for the workplace aggression literature are discussed.

We study the interplay between regulatory mandates and competition on a focal firm's new resource investments. While prior literature has separately pointed to the influence of competition and regulatory policy on a focal firm's resource decisions, less is known about how the policy effect interacts with the competitive effect. Studying how regulatory mandates moderate the effect of competition on a focal firm's new resource investments, we show that resource redeployment is not simply a function of internal firm decisions but a response to external forces. We find that regulatory mandates dampen the effect of competitors' new resource investments on a focal firm's new resource investments. Distinguishing between different clean technology types, we show that this dampening effect is the stronger, the more distant the new resource is from incumbents' old resource base, and the more established the mandate is. We test our hypotheses in the context of renewable energy investments in waste-to-energy, wind, and solar in the U.S. electricity industry. Our data comprises 1542 utilities and private energy firms and their renewable investments from 1999 to 2010.

In this paper, we use a practice-based wisdom perspective to address the challenges of managing competing logics in social enterprises. From previous work it is clear that a major task for social entrepreneurs is to manage the tension between social welfare and commercial logics. Although the social welfare logic and its related values and practices form the foundations of social enterprises, social entrepreneurs have also to ensure that their businesses are commercially sustainable making it necessary to engage with the commercial logic. To this end, we develop a curriculum matrix based on social practice wisdom to assist students to learn appropriate knowledge and skills, enact social entrepreneurship goals, and integrate competing logics in innovative and sustainable ways.

Research suggests that the structure of trainee reactions is captured with as few as one or as many as eleven dimensions. It is commonly understood that reactions contain both affective and cognitive components. To date, however, training research focuses largely on affective reactions that range from pleasant to unpleasant (i.e., valence). Here, we expand and further refine the construct of affective trainee reactions by including reactions that are more and less activating versions of pleasantness (e.g., excitement and calm, respectively) and unpleasantness (e.g., stress and boredom, respectively). We develop and validate a new measure based on this model and argue that the structure of affective reactions has implications for better understanding learning and course reputation outcomes. Results from a short online training indicate that reactions were best explained by four factors: pleasant activation (e.g., excitement), pleasant deactivation (e.g., calm), unpleasant activation (e.g., stress), and unpleasant deactivation (e.g., boredom). The relationships between these reactions and training outcomes suggest what is most beneficial for course reputation outcomes (i.e., pleasant activating reactions) may not benefit learning; what is most beneficial for learning (i.e., pleasant deactivating reactions) may benefit course reputation outcomes but slightly less so.

Female corporate leadership has drawn increasing attention from academia and practitioners. We contribute to the literature by examining the impact of CEO succession with gender change—i.e., a male CEO succeeded by a female or vice versa. We propose that due to gender differences in executive leadership positions, CEO succession with gender change may amplify the disruption of the CEO succession process and thus adversely affect post-succession firm performance and increase the likelihood of successor early departure. Using data from 3,320 CEO successions in companies listed in China's Shanghai and Shenzhen Stock Exchanges from 1997 to 2010, we find evidence to support this argument. We also find that the negative (positive) impact of male-to-female succession on firm performance (the likelihood of successor early departure) may be weakened by positive organizational attitudes toward female leadership as indicated by the presence of other female leaders on the firm's board of directors and/or top management team, and the successor's inside origin.

Management scholars have noted that leader departures often foreshadow higher turnover intentions (or lower organizational attachment) by subordinates left behind, especially when relationships between the departing leader and the subordinates, or leader-member exchanges (LMX), had been of high quality. In this paper, we posit that the quality of subordinates' relationships with all members of their relational system, not only their leader, must be considered to better understand how leader departures affect subordinates' organizational attachment. Our proposed relationships are illustrated in a theoretical model that includes phenomena at the individual-level (i.e., a subordinate's identification with the departing leader and with his/her organization), at the group-level (i.e., turnover contagion), and at the organizational level (i.e., organization-wide developmental climate). As such, we propose that elucidating how leader-departures affect organizational attachment requires multi-level theorizing and constructs. Theoretical and practical implications of such a 360-degree relational perspective on leader-departure effects are discussed.

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