Journal of Business Strategy

Ten Brink, Candace; Gelb, Betsy D.; Keller, Robert

2018 Journal of Business Strategy

doi: 10.1108/JBS-07-2017-0100

PurposeThis paper aims to examine technology-based firms that successfully turned around a decline in performance, to report what they did and what characterized the firms themselves, relating those actions and characteristics to effective rebounds.Design/methodology/approachThe authors use published data, including financial data, to examine 59 successful rebounds, and then apply regression analyses to relate firm actions and characteristics to performance.FindingsStrategic moves by these firms included layoffs, new products and new inter-company relationships. However, none of those actions predicted rebound success, either individually or in combination. Successful rebounds were associated only with smaller size and a deeper decline – from exceeding the industry performance median to falling far below it.Research limitations/implicationsTechnology firms may or may not represent all middle-aged companies in terms of authors’ implications, that a one-size-fits-all turnaround formula is unavailable.Practical implicationsWise managers will therefore consider various scenarios to prepare for decline and test several if possible. Further, the finding that dramatic drops in performance are associated with successful rebounds should warn managers who think that a competitor’s major problems mean they will disappear; they may be likelier to rebound than a competitor experiencing only a mild performance decline.Originality/valueManagers who think they have THE answer to decline can profit from the news that one cannot count on layoffs, on new products or on new relationships to turn around performance decline. And, the small-is-beautiful (for rebounds) result suggests rethinking the assumption that bigger is better and making organizational changes in large organizations to allow them to imitate the flexibility advantages that a smaller firm achieves.

Strong, John S.

2018 Journal of Business Strategy

doi: 10.1108/JBS-06-2017-0090

PurposeThis paper aims to analyze strategic decline in office supply retailing. The paper describes how inconsistent and biased internal decisions and perspectives can lead to decline, even for retailers, once dominant in their sector.Design/methodology/approachThis paper is a case study of Staples and the US office supply industry over a 30-year period.FindingsA series of inconsistent and contradictory strategic decisions led to the decline of Staples, the world’s largest office supply retailer. With a backdrop of increasing online competition, Staples failed to rethink the role of its store network, lost its value positioning and embarked on an inconsistent and flawed acquisition strategy.Originality/valueThis paper shows the need for retail companies to continue to develop strategies for traditional formats while moving into a multichannel competitive environment. The paper concludes with nine lessons for retailers, involving the need for distinct channel strategies, reinforcing of value positioning and the importance of an internal focus on strategic evolution.

LugoSantiago, José A.

2018 Journal of Business Strategy

doi: 10.1108/JBS-06-2017-0085

PurposeCollaboration facilitates competitive advantages. That’s the reason why every leader should be concerned with whether his or her part of the organization embraces collaboration or not. Collaboration in itself is an instrumental value, and it should be pursued as part of an organization’s enterprise-wide strategy, especially in merged organizations. Unfortunately, the natural inclination in merged organizations is for the merged entities to continue the past practice of independent, autonomous operations. When merged, the separate entities of the new organization naturally resist integration. The leader must infuse collaboration to enable knowledge sharing and the integration and employment of the new organization’s capabilities. The following discussion presents a roadmap to collaboration focused on the leader’s employment of seven critical practices.Design/methodology/approachConcept PaperFindingsScholarly study points to collaboration as an instrumental value. If it must become a value in the organization, then leaders must use seven practices as part of an enterprise-wide strategy and carefully follow the implementation of the seven practices until collaboration becomes a value and the natural instinct of the organization.Originality/valueLeaders struggle with how to bring collaboration into an environment where inertial forces impede it. The following discussion presents a roadmap to infuse collaboration and grow an appreciation for it because this process will facilitate the development and implementation of goals, objectives and action plans for the organization. Seven practices are discussed and integrated into an operational design-like method just like the one commanders use to achieve victories in military campaign planning and execution.

Pisoni, Alessia; Onetti, Alberto

2018 Journal of Business Strategy

doi: 10.1108/JBS-02-2017-0022

PurposeThe purpose of this paper is to present an overview of trends toward start-up exits. Exits represent the “end phase” of the start-up process, at least for the founders and the early investors. For high-growth venture-capital-backed companies, exits are often considered the ultimate goal of building a profitable venture. These ventures are intended from the beginning to harvest the financial value created by the business at some point in the future, and return capital to early investors.Design/methodology/approachThe authors tracked 5,744 merger and acquisition transactions that have occurred between European and US tech start-ups since 2012. Data are drawn from CrunchBase, the most comprehensive database of high-tech companies and investors with information on the companies and investors around the world. The authors then compared the trends of acquisitions between European and US companies.FindingsResults show that US companies are far more inclined to make acquisitions than European ones. Acquirers of start-ups, both from Europe and the US, prefer to buy local companies. However, recently, US companies have started to show more interest in European start-ups. Thus, signaling that the European start-up ecosystem is growing and becoming more attractive for US buyers. Furthermore, results show that start-up exits typically happen within a few years after a company’s establishment.Research limitations/implicationsThe research does not take into consideration the price of the transaction, or the amount of capital invested by venture capitalists in the high-tech start-ups that have been acquired. Further research should address this specific problem by helping European start-ups understand how to plan the exit phase within few years from establishment.Practical implicationsThe results have important implications both for entrepreneurs/managers and policymakers. Early exit appears to be a global trend among start-ups. This suggests that the exit phase should be properly planned to happen in the very early stage of the start-up process. On the other hand, the research also shows that there is still a gap to be filled in the European start-up ecosystems’ ability to produce exits and create new large innovative companies (the so-called “unicorns”).Originality/valueTo date, there has been a little research about exits for young high-tech ventures. This paper will attempt to shed new light on this so far under-explored issue by specifically analyzing exits as financial strategy for investors and entrepreneurs.

Berthod, Olivier

2018 Journal of Business Strategy

doi: 10.1108/JBS-04-2017-0038

PurposeThis study aims to point at the vulnerability of the networks on which companies rely, willingly or not. This vulnerability, it is argued, can be harnessed if firms proactively engage with their partners toward collective crisis management.Design/methodology/approachThe case study relies on a three-year fieldwork, including over 100 interviews and 560 hours of observations at a public organization specialized in crisis and emergency management.FindingsThis case study shows how practitioners who are trained in emergency management prepare for crisis mitigation via the harnessing of networks. The paper translates these insights into networking practices and heuristics for business settings.Originality/valueBecause it reports on an extreme organization specialized in crisis and emergency management, this case study reports on observations that are derived from the best. Promising practical implications for businesses are discussed.

Macpherson, Wayne G.; Lockhart, James C.; Kavan, Heather; Iaquinto, Anthony L.

2018 Journal of Business Strategy

doi: 10.1108/JBS-04-2017-0048

PurposeAs employees in the lower ranks of a Japanese company advance through the levels of management and seniority their role in day-to-day kaizen activities shifts from that of directly improving their own job, operations and surroundings to guiding, educating and facilitating understanding and practice. The emphasis of kaizen to the employee during career progression changes in an embedded, sequential and predictable manner. To a new employee, kaizen is a process to be implemented, something that is visible and largely provided through company training and job manuals, while not necessarily being fully understood. To the senior manager, however, one who has advanced up the corporate ladder, kaizen is tacit knowledge and accumulated experiences, and is seen as being more than just reducing costs, increasing productivity and decreasing lead times. At this point, kaizen becomes something invisible, something that can produce real influence on both the company’s profitability and the manager’s reputation. Consequently, what kaizen is actually changes from being a duty associated with employment to a matter of personal, group, collective, and organizational responsibility. The purpose of this paper is to explore the mechanism underpinning the transfer of kaizen (acknowledgement and exercise) in the Japanese workplace that results in it being sustained across multiple.Design/methodology/approachData were collected from research participants (n = 53) through a mixed-method multi-language field design comprising questionnaires and unstructured interviews conducted in genba, the workplaces of five domain-name multinational companies in Japan. Multi-level statistical analysis identified two largely mutually exclusive generational groups.FindingsDuring their late 40s, employees were found to transfer their understanding of kaizen between the two forms. At this age, employees were identified to shift from being student to teacher; follower to leader; and disciple to sensei. This study identified how kaizen shifts from one generation to another; when kaizen shifts through the change in responsibility of employees; and changes in the understanding and practice that creates sustained business excellence.Originality/valueImportantly, the study reveals how kaizen itself is a sustainable business activity in the workplace, one that Western business is struggling to emulate.

Hirsch, Peter Buell

2018 Journal of Business Strategy

doi: 10.1108/JBS-03-2018-0041

PurposeThis viewpoint reviews the current golden age of corporate purpose and raises the question as to the efficacy of corporate purpose and contributions to social value. The author warns that in the context of global populism, decades of stagnant real wages may bring back the era of contentious capital/labor relations and fundamental questions about the capitalist system.Design/methodology/approachThe viewpoint reflects on longer-term economic and social changes drawn from the literature and uses secondary sources on corporate purpose and the changing nature of work to suggest that corporations need to look at their corporate purpose efforts more critically.FindingsThe author finds that there is indeed a growing cause for concern in recent events that reflect new anger at income inequality and its root causes.Research limitations/implicationsAs a viewpoint, the findings are, by definition, the author’s own interpretation of the forces at work in capital/labor relations and, therefore, largely subjective.Practical implicationsThe corporations that are persuaded to take a more focused look at their wage and labor practices may reap significant reputational benefits in an increasingly contentious environment.Social implicationsGreat upheavals cause great change, but also great suffering. If a movement to reframe capital/labor relations can take hold before the next abrupt caesura, much social conflict can be avoided.Originality/valueWhile there is widespread discussion about new ideas such as the universal minimum, it is largely taking place in academia not in the policy space and less still inside corporations.