Now showing 1 - 10 of 28
  • Publication
    A Test of the Viable System Model: Theoretical Claim vs. Empirical Evidence
    The Viable System Model by Stafford Beer embodies a theory about the preconditions of organizational viability. This theory has been discussed extensively by the academics and professionals of organizational cybernetics. The theoretical claim of the Viable System Model (VSM) is bold. It asserts to specify the necessary and sufficient preconditions for the viability of any organization. The empirical evidence, to date, amounts to a substantial corpus of case studies from applications that support the claim of the theory. The present contribution leads beyond the status quo. Its purpose is to test the theory empirically, on the grounds of a broad survey and pertinent quantitative analysis. The available data support the hypotheses and therewith corroborate the theory of the VSM. This implies that the VSM is a reliable orientation device for the diagnosis and design of organizations to strengthen their vitality, resilience, and development potential.
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    Scopus© Citations 31
  • Publication
    Chief Strategy Officers: Contingency Analysis of Their Presence in Top Management Teams
    Drawing upon contingency theory, we analyze the antecedents and performance consequences of chief strategy officer (CSO) presence in top management teams (TMTs). We argue that strategic and structural complexity affects the decision to have a CSO in the TMT and its effect on firm performance. The results of a sample of S&P 500 firms over a five-year period reveal that diversification, acquisition activity, and TMT role interdependence are positively associated with CSO presence. However, we also find that the structural choice to have a CSO in the TMT does not significantly affect a firm's financial performance. This first systematic analysis of CSO presence informs research on CSOs and contributes to the emerging literature on TMT structure.
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    Scopus© Citations 80
  • Publication
    Succession processes in family firms: A new temporal perspective
    Succession is the most prominent topic in family business research and the succession path that a family chooses will likely impact the future performance of the business. Yet surprisingly little is known about how management, board, and ownership is transitioned from one generation to the next. Using an inductive, theory-building approach based on sequence analysis and evidence from succession paths in 116 public family firms in the US, we address this gap. We introduce the concept of succession path, which describes how management, board, and ownership transitions are structured over time. Our study reveals six distinct succession paths, which vary in their pace and rhythm, but show high similarity in the sequence of the transition. Further, we study the firm performance consequences of succession paths. Specifically, we find that family firms with fast-paced succession paths and those with slow-paced, but rhythmic succession paths outperform those with slow-paced irregular rhythms. Further, early-ownership transitions benefit firm performance. Establishing succession paths as a meaningful new concept in family business research, this study not only advances our understanding of the succession phenomenon but also extends our theoretical insights into temporal processes in family firm successions.
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  • Publication
    Exploring the Impact of Founder Social Identities on Sustainable Business Model Design
    Designing sustainable business models gains increasing importance. Particularly in young firms, the founder’s social identity plays a pivotal role in shaping the creation of new ventures. Yet, founders with diverse social identities often pursue distinct goals, and there is limited understanding of how this divergence influences the design of sustainable business models. Drawing on two different founder social identities — Darwinian and Missionary founders —, we argue that founder social identities differently shape the sustainability of the business model design. In addition, we propose that entrepreneurial orientation mediates the relationship between the founder’s social identities and sustainable business model design. We collected survey data from 195 solo founders in Austria, Germany, Liechtenstein, and Switzerland to test our research model. In support of our predictions, we find that Darwinian founders are negatively, and Missionary founders are positively related to sustainable business model design. We also show that entrepreneurial orientation partially mediates the link between Missionary founders and sustainable business model design, but not for Darwinian founders. Theoretical and practical insights on how founder social identities and entrepreneurial orientation can be leveraged to support sustainable business model designs are then discussed.
  • Publication
    Ownership matters! The benefits of appointing the predecessor CEO as board chair in family firm
    How does the appointment of a predecessor CEO as board chair (i.e., predecessor retention) affect post-succession firm performance? Agency theory suggests that firms with predecessor retention underperform compared to firms with other board chairs. We propose a stakeholder perspective rooted in incomplete contracting theory to highlight positive performance effects of predecessor retention. Stakeholders with firm-specific investments are concerned about being held up by new CEOs, which leads to negative stakeholder reactions upon CEO successions and post-succession performance declines. Because predecessor CEOs hold more firm-specific resources than other board chairs, they are well positioned to monitor and advise on stakeholder problems and mitigate performance declines after CEO successions. We identify family firms as a context in which the gains from mitigating negative stakeholder reactions outweigh the agency costs tied to predecessor retention. Probing a sample of CEO successions in the S&P 1500, we find that in family firms, predecessor retention leads to performance advantages over other board chairs, whereas the opposite holds true for nonfamily firms. We show that within the group of family firms, the performance advantages from predecessor retention increase in three contexts in which negative stakeholder reactions are pronounced: in outside CEO successions, in departures of long-tenured CEOs, and in firms with low complexity. Substantiating negative stakeholder reactions as the core mechanism, we show that predecessor retention decreases negative stakeholder reactions after CEO successions in family firms but not in nonfamily firms. Our study makes important contributions to the board chair and CEO succession literatures.
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  • Publication
    Does the Business Model Design Reflect the Founder Identity? An Empirical Investigation
    Social identities shape founders’ social motivation, self-evaluation, and frame of reference. However, little is known about how founder social identities shape new ventures’ business model designs. This study addresses this gap by arguing and empirically testing how and why founders with different social identities systematically design different business models. Specifically, we argue that Darwinian founders design efficiency-oriented business models, Communitarians design consumer-oriented business models, and Missionaries design sustainable-oriented business models. We also establish important boundary conditions of these relationships, particularly the core founder. We will test our predictions in a sample of 1‘019 new ventures from the German-speaking part of Europe. We contribute by establishing founder social identity as an important antecedent of business model designs and by linking founder social identities to firm strategy.
  • Publication
    Succession processes in family firms: A new perspective
    Succession is the most prominent topic in family business research and the succession path that a family chooses will likely impact the future performance of the business. Yet surprisingly little is known about succession paths⸻the sequence, pace, and rhythm with which management, board, and ownership is transitioned from one generation to the next. Using an inductive, theory-building approach based on sequence analysis and evidence from succession paths in 142 public family firms in the US, we address this gap. Our study reveals nine distinct succession paths with five distinct sequences of how management, board, and ownership transitions are structured over time. These sequences not only vary in their pace and rhythm, but also in their performance consequences. Specifically, we find that family firms with fast-paced succession paths and those with slow-paced, rhythmic succession paths outperform those with irregular rhythms. Further, early-ownership transitions benefit firm performance. Establishing succession paths as a meaningful new concept in family business research, this study not only advances our understanding of the succession phenomenon but also extends our theoretical insights into temporal processes in family firm successions.
  • Publication
    Estate taxes and business transfers across the globe: A configurational analysis
    Estate taxes on business inheritance are regularly the subject of controversial debates in business, politics and economics. However, a holistic understanding and systematic analysis of what shapes cross-national differences in estate taxes is missing. Using data from 54 countries, we present a comprehensive configurational analysis of socio-economic determinants of estate taxes. We reveal six distinct configurations of country-level entrepreneurial activity, business ownership, wealth inequality as well as cultural orientation towards individualism and the long term, which explain the presence of high or low estate taxes, and theorize around the institutional principles upon which societies draw to justify these estate taxes. Our analysis also highlights the importance of treating low and high estate taxes as separate outcomes since, for example, a country’s entrepreneurial activity is less relevant than business ownership in configurations for high estate taxes, while the opposite is true for configurations for low estate taxes. Our study contributes a more nuanced understanding of the drivers of international variation in estate taxes and the particular role of entrepreneurs and business owners therein.