Abstract

Research Summary Activist hedge funds are the new breed of corporate raiders, yet we know little about how the management and board of target firms respond to activist investors. Using a behavioral perspective, we propose that an activist's reputation for being confrontational conveys information to the target company as to what they are likely to encounter in an activist campaign. To avoid the potential adverse consequences of engaging in such a contest, we propose and find that target companies are more likely to settle with an activist known for being confrontational. Our study contributes to corporate governance research by providing insight into the importance of the social context surrounding activist campaigns and the role of reputation in influencing how companies respond to activist investors. Managerial Summary Given that hedge fund activism is having a major impact on firm's strategic and financial decision-making, it is important to understand how these activist investors influence companies. An activist campaign is a highly disruptive event leading to considerable ambiguity and uncertainty as to what is likely to transpire. Given this information void, our study finds that the board and management respond based on the reputation of the activist investor that has taken a stake in the company. That activist investors with a reputation for being hostile are more successful may be a defensive response on the part of management in order to avoid the potential adverse consequences of a hostile campaign. This has implications for corporate governance and the fiduciary duty of the board. Keywords

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activist hedge funds ;  corporate governance ;  executive decision-making ;  market signaling ;  reputation

Abstract

We investigate the role of high distance in trust erosion between small partners. High distance is known to hinder the formation of trust between potential partners, but its role in trust erosion in established partnerships is less understood by international business scholars. Through a qualitative longitudinal study, we extend current theory of how high distance affects the trust dynamics between cross-border partners. Specifically, we unearth three interrelated mechanisms that together explain how and why trust can erode due to high distance. We show that, before a partnership is formed, high distance can lead partners to erroneously attribute cues to a potential partner's high quality, leading to over-expectations of partner performance. Once the partnership is operational, high distance hinders actors' ability to understand situational factors associated with disappointing outcomes, and so they are attributed to failings of the partner. At the same time, distance-related challenges of bounded reliability render partners reluctant to discuss partnership outcomes. This can result in a vicious cycle of inertia as partners strive to protect goodwill while abandoning efforts to produce partnership outcomes because of doubts of the other's quality. Thus, our theoretical model illustrates the limitations of trust and explains how, paradoxically, high distance can facilitate both trust formation and trust erosion.

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Case theoretic approaches ;  China ;  Longitudinal ;  Process model ;  Small and medium-sized enterprises ;  Trust ;  Trust erosion

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Using survey data from China and India, we explore the impact of network strategy of new ventures in emerging markets. We focus on two critical dimensions of network strategy, namely, broadening and deepening the network and two types of knowledge: market knowledge and technological knowledge. We find that proactive network deepening is associated with market knowledge and network broadening with technological knowledge. From a network perspective, our work highlights the counterintuitive outcomes of breadth versus depth orientation in network strategy, highlighting differences between advanced and emerging economies. We use a post-hoc multi-group analysis to show the differences even within the two emerging markets: India and China. The direct effect of partnering proactiveness on market knowledge in India is significantly higher than that in China but there is no significant difference as to the effect of technological knowledge. We use this exploratory study to highlight the opportunities for network and entrepreneurship scholars to study emerging markets and, in particular, undertake comparative studies between new ventures in China and India.

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China ;  emerging market ;  entrepreneurship ;  India ;  knowledge ;  networks ;  new venture

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Although international business scholars have begun to recognize the division of entrepreneurial labor between MNEs and SMEs, there is a fragmented understanding of the different forms MNE–SME cooperation can take. We develop a typology that takes into account not only complementarity of capabilities but also, crucially, the compatibility of intent between MNEs (exploration vs. exploitation) and SMEs (international vs. domestic orientation). The framework offers a novel way to understand the forms and dynamics of MNE–SME cooperation. We also show how it can be applied more broadly, by considering its application to societal challenges, such as achieving the United Nations’ Sustainable Development Goals.

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global innovation ;  global value chain ;  interorganizational relationships ;  MNE-SME cooperation ;  SME internationalization ;  Sustainable Development Goals

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Should innovation come from within the company or from without? The answer is both.

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Collaboration ;  Employees ;  Empowerment ;  Entrepreneurs ;  Innovations ;  Intrapreneurs ;  Partnering ;  Startups

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Despite their prevalence and significance, competitive wars have received limited attention from the strategy literature. Our knowledge of how inter-organizational linkages influence competitive wars is particularly lacking. Drawing on the social embeddedness perspective, we argue that both direct linkages (i.e., strategic alliances) and indirect linkages (i.e., common ownership ties and common analyst ties) reduce the likelihood of war, thereby functioning as the glue that binds firms together. Yet once competitive wars are launched in related markets, indirect linkages through common third parties may continuously function as glue, reducing the likelihood of war spillover, whereas direct linkages, such as strategic alliances, may facilitate the spillover of competitive wars, akin to adding gasoline to a fire. Using data from the U.S. domestic airline industry between 1991 and 2010, our empirical evidence offers strong support for our predictions.

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Competitive Strategy ;  Competitive dynamics ;  Topic Areas ;  Strategic Management

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本案例讲述了私募基金分析师杨成在2018年2月15日的时间节点，整理投资分析报告，向投资经理推荐来年的通信行业投资机会。杨成将5G作为主推的板块——5G的技术变革将催生更多颠覆性应用，中国已将5G产业上升到国家战略层面。但当前5G行业投资存在很多不确定因素：一、5G标准尚未确定，世界各国都在积极研发5G核心技术，争取占据先机；如果标准押错，容易满盘皆输。二、通信行业周期明显，当前正处在4G基建高峰已过，5G启动尚早的寒冬期，过早投资可能会面对企业业绩兑现不及时的风险。三、5G对于各国而言都是涉及国家安全的战略级技术，在国际政治局势充满变化的环境下，中兴通讯等通信公司可能存在被国外市场禁入的风险。此时，如果你是杨成，是否应该推荐中国5G产业板块和中兴通讯给基金的投资经理？为什么？如果投资的话，应该如何应对上述风险？

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5G ;  产业投资 ;  企业投资 ;  投资决策 ;  通信行业

Abstract

改革开放短短40年，深圳GDP增长超过了1万倍。深圳产业转型和创新贯穿在深圳40年的发展历程中，华强北则是深圳产业发展与转型的缩影。40年前，华强北街道是深圳一条再普通不过的街；在中国改革开放的浪潮下，华强北从平地崛起，逐渐发展成为世界闻名的“中国电子第一街”。 华强北是如何探索和发展起来的呢？在发展过程中，华强北经历了几次产业升级和市场转型？然而，“盛极必衰”，曾经因“山寨手机”迎来爆发式增长的华强北，在电子商务、移动互联网技术迅速发展的情况下迅速面临困境，华强北应该如何应对新的挑战并找到新的业绩增长点呢？

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产业发展 ;  产业转型 ;  产业集群 ;  区域经济 ;  电子行业 ;  线下商城

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本案例描述了游戏产品经理高寒通过攻读MBA,进行第二次职业选择，转型做风险投资人的过程，以及在新的工作岗位上，高寒如何快速学习、适应新的工作。高寒的经历对于MBA学生而言有很好的借鉴作用，学生通过案例可以更好地了解应该如何进行早期的职业转型和选择，地域和工作的灵活性对职业发展的影响。本案例还详细描述了高寒在风险投资行业所从事的工作，学生可以通过案例进一步了解风险投资人是如何寻找项目、做价值判断、投出项目、并做投后服务的。对计划转型做风险投资的MBA学生的职业发展路径有具体的指导意义。

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MBA教育 ;  智能家居 ;  职业发展 ;  职业转型 ;  风险投资