41-60 of 269 Results

Article

Coordinating Knowledge: A New Lens to Understanding the Role of Technology in Episodic Coordination  

Elena Karahanna and Jennifer Claggett

Previous research in coordination lacked a practical explication of the metaknowledge used to enact coordination, which is particularly problematic as more coordination processes become (or attempt to become) digitized. One can better understand this meta knowledge by focusing on the coordination episode. The authors of this article define coordinating knowledge as knowledge that facilitates the exchange of information between two or more actors in order to achieve a shared goal by guiding (a) the timing, (b) the selection of actors, (c) the content, and (d) the method of the exchange. By integrating four bodies of literature (structured mechanisms, domain expertise, team familiarity, and transactive memory systems) that provide important insights into coordination the authors anatomize the framework into 14 specific types of coordinating knowledge that can impact how a coordination episode is enacted and its outcomes. Specifically, coordinating knowledge about triggers refers to knowledge indicating a need to initiate a coordination episode and may take the form of time-scheduled triggers, event-sequence triggers, and emergent triggers. Coordinating knowledge about actors refers to knowledge that helps select with whom to coordinate and may take the form of role, assignment, or individual knowledge about actors. Coordinating knowledge about content refers to knowledge that either helps select or present content shared during the coordination episode and may take the form of predetermined content selection or presentation, emergent content selection, recipient-tailored content selection, and shared understanding. Finally, coordinating knowledge about method refers to knowledge that helps select the appropriate medium of communication for a coordination episode and may take the form of predetermined method selection, media-fit method selection, or recipient-tailored method selection. Coordinating knowledge is conceptualized as a profile construct with meaningful combinations of coordinating knowledge that can be used to address different coordination dependencies and other contingencies. This conceptual framework affords a new understanding of how coordination is enacted and opens avenues to future research to explore how the presence and utilization of specific types of coordinating knowledge are likely to impact coordination performance. By explicating and elaborating upon coordinating knowledge, scholars and practitioners will be better positioned to design information systems to aid in the exchange of information by embedding different types of coordinating knowledge. Thus, the coordinating knowledge lens will be useful in understanding the evolving role of technology in coordination processes.

Article

Corporate Boards and Performance  

Jill Brown

In a new era of corporate governance defined by increasing shareholder empowerment, scrutiny from external stakeholders, and governance failures, there has been a movement toward redefining corporate governance models and the roles of boards. As a result, researchers and practitioners are left wondering what it means to be an effective board, and how a board can operate in the best interests of a firm’s stakeholders in this current environment. Exploring the expanded roles and demands of directors grounded in shareholder and director primacy debates, as well as reviewing theories and contingencies that link corporate boards to task, group, firm, and enterprise-level outcomes, a research agenda is identified that might better identify the parameters of board effectiveness.

Article

Corporate Entrepreneurship: A Research Perspective  

Donald F. Kuratko and Jeffrey G. Covin

The theoretical and empirical knowledge on corporate entrepreneurship (ce) has evolved in the research domain over the last 50 years, beginning very slowly and growing in importance in that time. Because of this evolution and expansion in CE research, the theoretical and empirical knowledge about CE and the entrepreneurial behavior on which it is based has progressed to a point where a greater understanding of the concept can be presented. Many of the elements essential to constructing a theoretically grounded understanding of the domains of CE have been identified. An examination of the field reveals that there are three research domains that have developed over the years: corporate venturing (either internal or external), strategic entrepreneurship, and entrepreneurial orientation. In examining the evolution of CE research across five decades, the focus of CE research has varied over the years. The very early research published in the 1970s focused more on how teams could establish entrepreneurial activities inside established organizations; however, this early research was sparse because CE was not widely acknowledged nor sought in existing organizations. The 1980s saw some research into entrepreneurial behavior inside established organizations that explained how such activity could simply not exist in the structure and operations of existing corporations. Opposed to that thinking, many more researchers demonstrated that the idea of corporate entrepreneurial activity could be conceived as a process of organizational renewal. In the 1990s, researchers began to develop more comprehensive examinations of CE that focused on re-energizing companies and therefore increasing its abilities to develop innovations. The first and second decades of the 21st century witnessed a more sophisticated refinement of research topics in CE. In addition to research specific to the development of the three main domains of CE (corporate venturing, entrepreneurial orientation, and strategic entrepreneurship), there has been research on more specific areas of interest in CE including the implementation of CE, management levels, the individual corporate entrepreneur, models and metrics of CE, a deeper examination of internal corporate ventures, the international domain, firm size, family firms, ethics, and corporate venture capital. These areas illustrate the developmental expansion of interest in CE across different domains. Even with the continued expansion in the research on CE, there is so much that is still not understood nor researched well enough to fully advance the theoretical and empirical knowledge on CE. With the growing climate of disruption through external antecedents such as COVID-19, the entrepreneurial behavior of individuals within organizations becomes paramount and warrants a deeper understanding. Newer research questions on CE are emerging and further theoretical exploration should be the work of ongoing scholarly efforts.

Article

Corporate Ethics  

Thomas Donaldson and Diana C. Robertson

Serious research into corporate ethics is nearly half a century old. Two approaches have dominated research; one is normative, the other empirical. The former, the normative approach, develops theories and norms that are prescriptive, that is, ones that are designed to guide corporate behavior. The latter, the empirical approach, investigates the character and causes of corporate behavior by examining corporate governance structures, policies, corporate relationships, and managerial behavior with the aim of explaining and predicting corporate behavior. Normative research has been led by scholars in the fields of moral philosophy, theology and legal theory. Empirical research has been led by scholars in the fields of sociology, psychology, economics, marketing, finance, and management. While utilizing distinct methods, the two approaches are symbiotic. Ethical and legal theory are irrelevant without factual context. Similarly, empirical theories are sterile unless translated into corporate guidance. The following description of the history of research in corporate ethics demonstrates that normative research methods are indispensable tools for empirical inquiry, even as empirical methods are indispensable tools for normative inquiry.

Article

Corporate Ethics Codes and Practices  

Tanusree Jain and Jiangtao Xie

Having a Code of Ethics (COE) has become a common practice within large companies since the 1980s. A COE serves multiple functions for organizations: as an internal control mechanism to guide employees during ethical dilemmas, a benchmark for fostering ethical corporate culture, and as a communication tool to signal organizational commitment to stakeholders. Four major theoretical frameworks underpin the extant academic scholarship on COEs. In particular, organizational justice and stakeholder theories highlight the role of individuals in adopting and shaping a COE, and the institutional theory emphasizes the influence of the exogenous environment on the convergence and/or divergence of COEs across firms and contexts. Integrative social contracts theory captures the significance of both individuals and the institutional environment and views COEs as a contractual obligation that guides managers and employees to manage contradictions between local and global norms. Within these theoretical framings, significant variations in the nature and stakeholder orientations of COEs have been detected across the developed and developing world. In the developed contexts, a comparative institutional analysis using the national business system approach shows that while in the compartmentalized cluster (the United States, United Kingdom, Canada, Australia, and Japan), expectations of market participants and firm owners are key drivers of COEs; in the collaborative cluster (Germany, Ireland, and the Netherlands), firms develop COEs that have a wider focus oriented towards multiple stakeholders such as employees, suppliers, and the environment. Whereas in the state-organized cluster (South Korea, Spain, Greece, and Slovakia) the role and the nature of the state are important guiding factors. The coordinated industrial district cluster (Italy) characterized by alliances among smaller artisanal firms demonstrates a human-centric view of business embedded within their COEs. Excluded from the national business systems categorization, the Nordic cluster displays a unique distinctiveness in its approach to COEs through the presence of a structured moral apparatus within firms. In the developing world, country-specific institutional characteristics play a vital role behind adoption of localized a COE, yet nonstate actors—namely multinationals enterprises, and international and supranational institutions—promote the diffusion of hyper-norms. Given the pervasiveness of corporate misconduct despite the global diffusion of COEs, scholars must pay heed to understand the conditions under which gaps between a COE adoption and implementation arise. Equally, more scholarly attention needs to be accorded to a systematic investigation of COEs in transitional and emerging contexts. This becomes particularly necessary in the face of sociological changes, a fast-evolving landscape of local and transnational regulations including those arising from global events such climate change, and COVID-19, and the co-existence of multilevel COEs at the industry, firm, and professional levels.

Article

Corporate Governance and the Multinational Enterprise  

Roger Strange

Corporate governance refers to the array of structures, mechanisms, and institutional constraints that influence the ways in which firms control and manage their operations. Most analyses of corporate strategy implicitly assume that firms are risk-neutral and their strategic decisions are guided by short-term profit maximization. But foreign direct investment (FDI) projects undertaken by multinational enterprises (MNEs) typically require substantial commitments of resources, involve high levels of uncertainty and risk, and may not yield positive returns for many years. MNEs’ willingness to engage in outward foreign direct investment (OFDI) projects is likely to depend inter alia on the identity, expertise, and relative influence of the MNE’s major shareholders and other relevant stakeholders and their objectives, attitudes to risk, and decision-making time horizons. Furthermore, the impact of corporate governance mechanisms and structures will depend upon the formal and informal institutional attributes in both host and home countries. Any consideration of MNEs’ FDI strategies must therefore consider not only the MNEs’ own resources and capabilities but also their ownership structures and the governance environment within which they operate. Future research should focus on the impacts of both formal and institutions on MNE corporate governance and FDI strategy, how internal “conflicting voices” regarding FDI strategy are resolved, and how the impact of corporate governance on FDI may depend upon various firm (e.g., size) and project (e.g., FDI motive) characteristics.

Article

Corporate Governance in Business and Management  

Erik E. Lehmann

Corporate governance is a recent concept that encompasses the costs caused by managerial misbehavior. It is concerned with how organizations in general, and corporations in particular, produce value and how that value is distributed among the members of the corporation, its stakeholders. The interrelation of value production and value distribution links the ubiquitous technological aspect (the production of value) with the moral and ethical dimension (the distribution of value). Corporate governance is concerned with this link in general, but more specifically with the moral and ethical dimensions of distributing the generated value among the stakeholders. Value in firms is created by firm-specific investments, and the motivation and coordination of value-enhancing activities and investment is protected by the power concentrated at the pyramidal top of the organization. In modern companies, it is the CEO and the top management who decide how to create value and how to distribute it among the relevant stakeholders. Due to asymmetric information and the imperfect nature of markets and contracts, adverse selection and moral hazard problems occur, where delegated (selected) managers could act in their own interest at the costs of other relevant stakeholders. Corporate governance can be understood as a two-tailed concept. The first aspect is about identifying the (most) relevant stakeholder(s), separating theory and practice into two different and conflicting streams: the stakeholder value approach and the shareholder value approach. The second aspect of the concept is about providing and analyzing different mechanisms, reducing the costs induced by moral hazard and adverse selection effects, and balancing out the motivation and coordination problems of the relevant stakeholders. Corporate governance is an interdisciplinary concept encompassing academic fields such as finance, economics, accounting, law, taxation, and psychology, among others. As countries differ according to their institutions (i.e., legal and political systems, norms, and rules), firms differ according to their size, age, dominant shareholders, or industries. Thus, concepts in corporate governance differ along these dimensions as well. And while the underlying characteristics vary in time, continuously or as a result of an exogenous shock, concepts in corporate governance are dynamic and static, offering a challenging field of interest for academics, policymakers, and firm managers.

Article

Corporate Governance in Entrepreneurial Firms  

Julio De Castro, Jose Lejarraga, and Qiong Wu

Corporate governance unfolds in entrepreneurial firms, giving rise to concerns about the coordination and control of resources. Understanding corporate governance in entrepreneurial firms (CGEF) is important because of the challenges of liability of newness and smallness and issues of transition. In particular, two issues affect these firms: a diluted separation between ownership and control and the role played by boards of directors. As a result, most of the literature on CGEF revolves around the interrelations between these governance mechanisms and how they affect the outcomes of entrepreneurially driven firms. This combination of factors present in entrepreneurial firms gives rise to new theoretical perspectives that enrich the corporate governance literature.

Article

Corporate or Product Diversification  

Margarethe F. Wiersema and Joseph B. Beck

Corporate or product diversification represents a strategic decision. Specifically, it addresses the strategic question regarding in which businesses the firm will compete. A single-business company that expands its strategic scope by adding new businesses becomes a diversified, multibusiness company. The means by which a company expands its strategic scope is by acquiring businesses, investing in the development of new businesses, or both. Similarly, an already diversified firm can reduce its strategic scope by divesting from or closing businesses. There are two fundamentally different types of corporate diversification strategy, depending on the interrelatedness of the businesses in the company’s portfolio: related diversification and unrelated diversification. Related diversification occurs when the businesses in the company’s portfolio share strategic assets or resources, such as technology, a brand name, or distribution channels. Unrelated diversification occurs when a company’s businesses do not share strategic assets or resources and do not have interrelationships of strategic importance. Companies can pursue both types of diversification simultaneously, and thus have a portfolio of businesses both related and unrelated. In addition to variations in the type of diversification, companies can vary in the extent of their diversification, ranging from business portfolios with very limited diversification to highly diversified portfolios. Decisions regarding the diversification strategy of a firm represent major strategic scope decisions since they impact the markets and industries in which the company will compete. Companies can increase or reduce their level of diversification for a variety of reasons. Economic motives, for example, include the pursuit of economies of multiproduct scale and scope, whereby per-unit costs may be lowered through the increase in sales volume or other fixed-cost reducing benefits associated with growth through diversification. In addition, companies may diversify for strategic reasons, such as enhancement of capabilities or superior competitive positioning through entry into new product markets. Similarly, economic and strategic reasons can motivate the firm to refocus and reduce its level of diversification when the strategic and economic rationales for being in a particular business are no longer justified. The performance consequences of corporate diversification can vary, depending on both the extent of the firm’s diversification and the type of diversification. In general, research indicates that high levels of diversification are value-destroying due to the integrative and complexity-associated costs that administering an extremely diversified portfolio imposes on management. Nevertheless, related diversification, where the company shares underlying resources across its business portfolio (e.g., brand, technology, and distribution channels), can lead to higher levels of performance than can unrelated diversification, due to the potential for enhanced profitability from leveraging shared resources. Corporate diversification was a major U.S. business trend in the 1960s. During the 1980s, however, pressure from the capital market for shareholder wealth maximization led to the adoption of strategies whereby many companies refocused their business portfolios and thus reduced their levels of corporate diversification by divesting unrelated businesses in order to concentrate on their predominant or core business.

Article

Corporate Political Strategies  

Rodrigo B. DeMello

Firms deploy value-based strategies to achieve competitive advantage in the marketplace. However, processes of value creation and appropriation do not happen in a vacuum but are structured by a set of formal market institutions that define, among other things, policies and regulations on standards, privacy, safety, trade, and access to resources. Corporate political strategies are the ways firms use to shape these policies and regulations in favorable ways that help them achieve competitive advantage. The political activities include lobbying, participation in hearings, campaign contributions, the use of revolving-door personnel, advocacy, grass-roots mobilization, and nurturing and exploiting political ties. Firms interact with government officeholders in different government arenas, such as national and local legislatures, government agencies, and the judiciary branch. For most corporations, being able to deploy effective political strategies is, therefore, necessary for achieving sustainable competitive advantage. The research into corporate political strategies has tried to explain why firms engage in political strategy, when, and which political activity would yield the best results. The usual theoretical framings draw from Resource Dependence Theory, Institutional Theory, Resource-Based View, Agency Theory, and Stakeholder Theory. While the strategic logic underlying each theoretical approach varies, they are better seen as complementary to each other. The fact that the phenomenon of political strategies is complex, dynamic, and an important part of daily business of several corporations favors the integration of different theoretical approaches. Although the literature on corporate political strategies has considerably advanced, there are still areas that could benefit from future research: the integration of market and political strategies, especially the use of market actions as political influence; the integration of social and political strategies; the role that individual and managerial aspects play in choice of political strategies; and multicountry comparative studies, especially focusing on ideological turnarounds and state capitalism.

Article

Corporate Restructuring  

Wayne F. Cascio

Corporate restructuring occurs when a company makes significant changes to its financial or operational structure, for example, by changing its complement of employees or assets through downsizing or upsizing. A common set of factors drives decisions to restructure, including decisions to divest or to acquire employees, assets, or both. In order of priority, these factors comprise current and prior company performance, managerial foresight, economic conditions, political uncertainty, industry, and technology. Companies typically downsize employees to stop eroding profitability and to increase the likelihood of future profitability. The economic rationale that drives it is straightforward: companies become profitable when revenues exceed costs, an outcome obtained by increasing revenues, decreasing costs, or both. Because future revenues are less predictable and controllable than future costs, decreasing costs is compelling. Managers often do that by reducing the size of the workforce and its associated labor costs. Employee downsizing makes sense when it is a reaction to an emergency, such as the COVID-19 pandemic. Employee downsizing can also be part of a broader workforce strategy designed to adjust workforce competencies to align more closely with the overall strategy of a business. Organizations typically use one or more of four broad methods to downsize their workforces. The simplest is natural attrition. Alternatively, firms may offer buyouts—to individual employees (voluntary severance), to entire business units (corporate restructuring), even to the entire organization. A third strategy is involuntary layoffs—termination—with no choice by the departing employees. Businesses large and small that were hard hit by the pandemic had little or no choice but to use this strategy. A final strategy is early retirement offers, often part of a broader buyout scheme. From an organizational view, early retirement has the advantage of opening up promotion opportunities for younger workers. When firms downsize employees, they incur direct as well as indirect costs. While almost all the direct costs, such as severance pay and accrued vacation, are short-term (realized in the year they are incurred), indirect costs, such as decreased productivity, reduced morale, and aversion to risk among survivors, begin to accrue immediately and may continue for longer periods. When considering alternatives to downsizing employees, decision-makers must first assess if the downturn in business is permanent or temporary. If permanent, the only alternative to layoffs is to upskill, reskill, or retrain employees to develop new lines of business. If temporary, then there are numerous alternative ways to cut costs besides laying off workers. These range from reducing work hours to redeploying workers. A central issue for many stakeholders is the financial consequences of corporate restructuring. Regarding acquisitions, there is little evidence of a net beneficial effect on the performance of the acquirer, as measured by profitability. Rather, such actions often yield a lower rate of return than growth through internal investment. With respect to divestiture of assets, meta-analysis reveals a mixed picture of subsequent performance. Evidence does indicate, however, that different performance effects can be attributed to different conditions of the macroeconomy. With respect to within-company changes in employees, assets, or both, large-scale research reveals that corporate restructuring undertaken during difficult financial conditions, on average, outperforms corporate restructuring undertaken under more benign conditions. An important lesson for managers is to avoid downsizing as a quick fix to restore or enhance profitability. Layoffs are the most frequently employed method of downsizing but provide the smallest payoff. When faced with deteriorating results, it might be more prudent to be patient and to undertake the more demanding and comprehensive downsizing of employees and assets. As for upsizing employees, assets, or both, high-profitability upsizing does not automatically lead to better stock market performance. It tends to yield better results when the company’s performance needs improvement.

Article

Corporate Social Entrepreneurship  

Elisa Alt

Corporate social entrepreneurship (CSE) is a subject of growing interest for scholars in the areas of corporate entrepreneurship, social entrepreneurship, and corporate social responsibility as it has the potential of engaging corporations in activities that transform traditional practices, advance corporate purpose, and promote positive social change. CSE consists of identifying, evaluating, and exploiting entrepreneurial opportunities that address social and environmental problems through market means from within corporations. Dual value creation—the simultaneous pursuit of social and economic value creation—is a core element of CSE, however, in organizations that have not been originally designed for this purpose. As an umbrella concept, CSE embraces similar terms such as social intrapreneurship and sustainable corporate entrepreneurship. CSE often starts autonomously through managers and employees acting as social intrapreneurs, until initiatives are accepted and integrated into the firm’s concept of strategy. CSE introduces a societal concern to corporate entrepreneurship, contextualizes social entrepreneurship in corporations, and advances entrepreneurial approaches to corporate social responsibility—all of which are topics that remain relatively unexplored and that offer vibrant opportunities for future research.

Article

Corporate Social Responsibility  

Abagail McWilliams

Corporate social responsibility (CSR) is a legitimate responsibility to society, based on the principle that corporations should share some of the benefit that accrues from the control of vast resources. CSR goes beyond the legal, ethical, and financial obligations that create profits. In the research literature, corporate social responsibility is defined in a variety of ways, depending on the aspect of CSR being examined. An inclusive definition is that social responsibility requires the firm to take into account the interests of all stakeholders, where stakeholders are defined as everyone who affects or is affected by the firm’s decisions and actions. A firm-focused definition holds that social responsibility includes actions that further a social goal, beyond what is required by ethics, law, and profitability. A political economy–oriented definition posits that firms have a responsibility to correct market failures such as negative externalities and government failures such as limits to jurisdiction that result in worker rights violations. When implemented, altruistic CSR implies that firms provide a social good unrelated to the firms’ business that does not benefit the bottom line. Strategic CSR implies that firms are simultaneously profitable and socially responsible. To achieve this, CSR must be a core value of the firm and must be integrated into processes and products. When employed strategically, CSR can be an element of a differentiation strategy, leading to premium prices, enhanced brand and firm reputation, and supportive community relations. Corporate environmental responsibility often takes the form of overcompliance with regulation, improving the environment more than is required. A primary benefit of this is to stave off further regulation. To capture the benefits of being socially responsible, the firm must make stakeholders aware of its record. This has led to triple bottom line reporting—that is, reporting about firm performance in terms of profits, people, and the planet. Social enterprises go a step further and make social responsibility the primary goal of the organization.

Article

Corruption and Business Ethics  

Steven G. Koven and Abby Perez

Corruption remains a way of life for many cultures and subcultures, an ethos that is often consistent with the goal of corporate profit maximization. Corruption may yield benefits at the personal or individual firm level, but at the societal level corruption is detrimental to aggregate growth, individual effort, and faith in institutions. Corruption, as defined by the Oxford English Dictionary, is dishonest or fraudulent conduct by those in power, typically involving bribery. Corruption exists on a continuum that can range from rampant to minimal. Rampant corruption exists when entire organizations willingly and knowingly promote actions that are injurious to workers, consumers, or society as a whole. Egregious examples include knowingly producing and selling harmful products or ignoring conditions that impair the health and safety of workers. At the other extreme, minimal corruption can include petty violations such as stealing a small amount of office supplies for personal use. Moral, ethical, and legal guides have evolved over time in efforts to ameliorate the most obvious and egregious forms of corruption. These guides are supported by perspectives of philosophy such as utilitarianism, deontology, virtue ethics, intuition, and ethical relativism. Each of these perspectives represent an important and qualitatively different lens in which to assess ethical behavior. While some philosophical viewpoints emphasize the categorical nature of right or wrong action, others emphasize context, net benefits of actions, or individual virtue reflected in individual actions, and perspectives that are systematically reviewed. Philosophical influences are viewed as highly relevant to an understanding of modern-day corruption. Business ethics is also influenced by various competitive and complementary models that compete for influence. While the market model of business ethics has long endured, alternative perspectives of business ethics such as the stakeholder model of corporate social responsibility and the sustainability model have recently arisen in popular discourse and are explored. These alternative models seek to replace or supplement the market model and advocate for a greater recognition of environmental responsibilities as well as responsibilities to a broad array of stakeholders in society such as workers and consumers. Alternative models move beyond the narrow perspective of profit maximization and consider ethical implications of business decisions in terms of their effects on others in society as well as future generations. Various philosophical perspectives of ethics are examined, as well as how these perspectives can be applied to attain a more complete understanding of the concept of corruption.

Article

Creative Thinking Processes: Managing Innovative Efforts  

Michael D. Mumford, Robert Martin, and Samantha N. Elliott

Creative thinking is the basis for innovation in firms. And the need for strategy-relevant innovations has generated a new concern with how people go about solving the kinds of problems that call for creative thought. Although many variables influence people’s ability to provide creative problem solutions, it is assumed the ways in which people work with or process knowledge provides the basis for successful creative problem-solving efforts. Additionally, there has been evidence bearing on the processing activities that contribute to creative problem solving. It is noted that at least eight distinct processing activities are involved in most incidents of creative problem solving: (1) problem definition, (2) information gathering, (3) concept selection, (4) conceptual combination, (5) idea generation, (6) idea evaluation, (7) implementation planning, and (8) adaptive monitoring. There are strategies people employ in effective execution of each of these processes, along with contextual variables that contribute to, or inhibit, effective process execution. Subsequently, there are key variables that operate in the workplace that contribute to, or inhibit, effective execution of these processing operations. These observations, of course, lead to implications for management of innovative efforts in firms.

Article

Critical Thinking in Business Research  

Mark Loon

Critical thinking is more than just fault-finding—it involves a range of thinking processes, including interpreting, analyzing, evaluating, inferencing, explaining, and self-regulating. The concept of critical thinking emerged from the field of education; however, it can, and should, be applied to other areas, particularly to research. Like most skills, critical thinking can be developed. However, critical thinking is also a mindset or a disposition that enables the consistent use and application of critical thought. Critical thinking is vital in business research, because researchers are expected to demonstrate a systematic approach and cogency in the way they undertake and present their studies, especially if they are to be taken seriously and for prospective research users to be persuaded by their findings. Critical thinking can be used in the key stages of many typical business research projects, specifically: the literature review; the use of inductive, deductive, and abductive reasoning and the relevant research design and methodology that follows; and contribution to knowledge. Research is about understanding and explaining phenomena, which is usually the starting point to solve a problem or to take advantage of an opportunity. However, to gain new insights (or to claim to), one needs to know what is already known, which is why many research projects start with a literature review. A literature review is a systematic way of searching and categorizing literature that helps to build the researchers’ confidence that they have identified and recognized prevailing (explicit) knowledge relevant to the development of their research questions. In a literature review, it is the job of the researcher to examine ideas presented through critical thinking and to scrutinize the arguments of the authors. Critical thinking is also clearly crucial for effective reasoning. Reasoning is the way people rationalize and explain. However, in the context of research, the three generally accepted distinct forms of reasoning (inductive, deductive, and abductive) are more analogous to specific approaches to shape how the literature, research questions, methods, and findings all come together. Inductive reasoning is making an inference based on evidence that researchers have in possession and extrapolating what may happen based on the evidence, and why. Deductive reasoning is a form of syllogism, which is an argument based on accepted premises and involves choosing the most appropriate alternative hypotheses. Finally, abductive reasoning is starting with an outcome and working backward to understand how and why, and by collecting data that can subsequently be decoded for significance (i.e., Is the identified factor directly related to the outcome?) and clarified for meaning (i.e., How did it contribute to the outcome?). Also, critical thinking is crucial in the design of the research method, because it justifies the researchers’ plan and action in collecting data that are credible, valid, and reliable. Finally, critical thinking also plays a role when researchers make arguments based on their research findings to ensure that claims are grounded in the evidence and the procedures.

Article

Crowdfunding for Entrepreneurs  

Vincenzo Butticè and Massimo G. Colombo

Fundraising has proved difficult for many entrepreneurs and ventures in the early stages of their businesses because of significant information asymmetries with investors and a lack of collateral. In an attempt to overcome such difficulties, since the early 2010s, some entrepreneurs have come to rely on the Internet in order to directly seek funding from the general public, or the “crowd.” The practice of collecting small amounts of capital from the “crowd” of Internet users is called crowdfunding. Crowdfunding research is a relative newcomer to the discipline of entrepreneurial finance. However, the availability of easy-to-access data, the diffusion of this funding channel among entrepreneurs, and increasing policy attention have made crowdfunding one of the most investigated areas of research in entrepreneurial finance. The literature has discussed crowdfunding as more than a simple mean of financing. Crowdfunding also allows entrepreneurs to develop a virtual community of followers, which provides a valuable source of information with which to test and improve early versions of innovative products. Moreover, crowdfunding represents a method of gaining information about market response to a given product and the size of demand for that product, and is a powerful marketing instrument that can be used to increase brand awareness and to promote the arts, social initiatives, and financial inclusion. However, crowdfunding also entails a number of pitfalls for entrepreneurs. In order to collect financial resources from the crowd, entrepreneurs are required to share sensitive information online. This includes information about the entrepreneurial initiative, the team, and the business model they are using. The provision of this information may facilitate product counterfeiting, or the appropriation of the value of the idea by other firms or entrepreneurs. Moreover, crowdfunding entails the risk of social stigma if the funding campaign results in a failure, because information about the performance of the crowdfunding campaign usually remains accessible online. Finally, crowdfunding entails additional challenges related to the management of the crowd of backers after the campaign, since several backers will be active providers of feedback and will interact with the entrepreneurs through direct communication. Despite these disadvantages crowdfunding has become a widely used funding source for entrepreneurs looking for financing for sustainable projects, creative initiatives, and innovative ideas.

Article

Crowdsourcing Innovation  

Linus Dahlander and Henning Piezunka

Crowdsourcing—a form of collaboration across organizational boundaries—provides access to knowledge beyond an organization’s local knowledge base. There are four basic steps to crowdsourcing: (a) define a problem, (b) broadcast the problem to an audience of potential solvers, (c) take actions to attract solutions, and (d) select from the set of submitted ideas. To successfully innovate via crowdsourcing, organizations must complete all these steps. Each step requires an organization to make various decisions. For example, organizations need to decide whether its selection is made internally. Organizations must take into account interdependencies among these four steps. For example, the choice between qualitative and quantitative selection mechanisms affects how widely organizations should broadcast a problem and how many solutions they should attract. Organizations must make many decisions, and they must take into account the many interdependencies in each key step.

Article

De-Internationalization: The Other Side of Internationalization  

Gabriel R. G. Benito

Companies rightly regard internationalization decisions as strategic; they are long-term, require and bind up resources, and have important implications for companies’ performance. But internationalization is inherently demanding and risky, changes are likely to happen, and there is no guarantee of a positive outcome. The notion of de-internationalization captures the other side of internationalization: actions that reduce a company’s engagement in or exposure to international or border-crossing activities. One important dimension of de-internationalization is its extent, which ranges from a total withdrawal from international operations to partial retractions, such as exiting from a particular market, and minor adjustments, such as downscaling activities. Another key dimension is the volition aspect of de-internationalization, which distinguishes between de-internationalization decisions that are principally taken by the companies themselves, and those that have been imposed upon the companies by other actors, such as host-country authorities. There are three main types of de-internationalization: reductions in trade volume, market withdrawals, and divestments. Extant research, while limited, has tended to take either a behavioral perspective or an economics perspective. The latter takes a choice (or decision) perspective on de-internationalization, while the former emphasizes the process aspects of such actions. De-internationalization does not need to be the end of the road for companies’ foreign involvement. There is mounting evidence that de-internationalization can be temporary, with companies re-entering foreign markets after a time-out period, often by implementing better suited approaches when retrying.

Article

Design Thinking in Business and Management: Research History, Themes, and Opportunities  

Jarryd Daymond and Eric Knight

Design thinking is a human-centered, innovation-focused problem-solving approach that employs various tools and methods for creative purposes. It is a dynamic process and often prioritizes the needs and experiences of people while considering both technical and economic aspects of a solution. The prominence of design thinking in practice has seen its use move beyond product development teams to take a more central role in shaping how organizations approach problems, develop strategies, build capabilities, and drive cultural change. It is common for organizations to employ executives with a specific focus on design, and traditionally “nondesign” organizations increasingly build, buy, or borrow design capabilities. The utility of design thinking stretches beyond organizational outcomes, with educators and employers recognizing that understanding and proficiency in design thinking is a valuable and transferrable skill. A rich scholarly tradition in design sciences and engineering underpins design thinking. These traditions provide the foundational understandings of problem definition and need-finding, information gathering and analysis, and creative expression and ideation, from which design thinking gained prominence. Although not often acknowledged in contemporary scholarship, design thinking research builds on these traditions and offers unique perspectives on the practice of design thinking and its theoretical underpinnings: The cognitive perspective focuses on how unique ways of thinking shape the practice of design thinking; the instrumental perspective attends to how design thinking is done, including the methods or tools used in design thinking; and the organizational-level perspective concerns the implementation of design thinking in organizations and its influence on organizational culture and capabilities. While the various research traditions preceding design thinking are receiving greater attention in contemporary research, rich insights from these established fields offer deep theoretical knowledge to develop several promising research areas. These avenues for future research include how design thinking can inform the redevelopment of services and customer experiences, tackle societal challenges, and build capabilities to benefit communities and society more generally.