infonet-economy

The concept of a dominant design has taken on a quasi-paradigmatic status in analyses of the link between technological and industrial dynamics. A review of the empirical literature reveals a variety of interpretations about some aspects of the phenomenon such as its underlying causal mechanisms and its level of analysis. To stimulate further progress in empirical research on dominant designs, we advocate a standardization of terminology by conceptualizing products as complex artifacts that evolve in the form of a nested hierarchy of technology cycles. Such a nested complex system perspective provides both unambiguous definitions of dominant designs (stable core components that can be stable interfaces) and inclusion of multiple levels of analysis (system, subsystems, components). We introduce the concept of an operational principle and offer a systematic definition of core and peripheral subsystems based on the concept of pleiotropy. We also discuss how the proposed terminological standardization can stimulate cumulative research on dominant designs.

This essay covers the development of the chemical industry from 1850 to 2000 in 4500 words. It is meant to give a concise overview of the economics signifance, the key innovations, the market structures, the environmental impact of the chemical industry. For a more detailed account of the chemical industry, read "Chemicals and Long-Term Economic Growth" edited by Ashish Arora, Ralph Landau and Nathan Rosenberg.

The beginning of a new millennium provides a welcome opportunity to take stock of the accomplishments, open questions, and most promising research avenues of evolutionary models in management and organization theory. Johann Peter Murmann has invited Howard Aldrich, Daniel Levinthal, and Sidney Winter to appraise the state of the art in evolutionary research and where scholarly efforts should go in the new millennium. The panel also clarified their positions by answering questions that Johann Peter Murmann solicited from the scholarly community in response to the panel’s dialogue.

Evolutionary perspectives contend that complex structures in the social and the biological world have developed over time through causal processes that require little or no foresight but considerable trial and error. Evolutionary thought in organizational analysis comprises two distinct intellectual lines. The first, concerned with organizational change, relies to a considerable extent on a selection logic in which change comes about through the birth and death of individual entities that make up a population of similar things. This account of change contrasts sharply with theories in which omniscient actors perfectly transform individual entities to meet new environmental conditions. The second line of evolutionary thought draws on evolutionary psychology to explain the behavior of human beings in organizational settings in terms of the evolved nature of the human mind and body

Hettich, Erwin & Müller-Stewens, Günter: Tesla Motors. Business Model Configuration. In de Wit, Bob (ed.): Strategy: An International Perspective. Hampshire : Cengage Learning, 2017, S. 759-774.

The concept of a dominant design has taken on a quasi-paradigmatic status in analyses of the link between technological and industrial dynamics. A review of the empirical literature reveals a variety of interpretations about some aspects of the phenomenon such as its underlying causal mechanisms and its level of analysis. To stimulate further progress in empirical research on dominant designs, we advocate a standardization of terminology by conceptualizing products as complex artifacts that evolve in the form of a nested hierarchy of technology cycles. Such a nested complex system perspective provides both unambiguous definitions of dominant designs (stable core components that can be stable interfaces) and inclusion of multiple levels of analysis (system, subsystems, components). We introduce the concept of an operational principle and offer a systematic definition of core and peripheral subsystems based on the concept of pleiotropy. We also discuss how the proposed terminological standardization can stimulate cumulative research on dominant designs.

In a simulation experiment, building on the abductive simulation approach of Brenner and Werker (2007), we test historical explanations for why German firms came to surpass British and France firms and to dominate the global synthetic dye industry for three decades before World War 1 while the U.S. never achieved large market share despite large home demand. Murmann and Homburg (2001) and Murmann (2003) argued that German firms came to dominate the global industry because of (1) the high initial number of chemists in Germany at the start of the industry in 1857, (2) the high responsiveness of the German university system and (3) the late (1877) introduction of a patent regime in Germany as well as the more narrow construction of this regime compared to Britain, France and the U.S. We test the validity of these three potential explanations with the help of simulation experiments.  The experiments show that the 2nd explanation—the high responsiveness of the German university system— is the most compelling one because unlike the other two it is true for virtually all plausible historical settings.

Studies of competition typically have two underlying assumptions: that competition occurs within the boundaries of industries or markets and that all firms in a market or industry are affected equally by competitive pressures. The concept of multipoint competition challenges both assumptions. Multipoint theory addresses how different levels of contact between firms across multiple markets affect competition in individual markets. Its main argument is that high levels of contact between firms across markets will induce mutual forbearance, causing multipoint competitors to refrain from aggressively attacking each other.
The restraint stems from the fact that high levels of intermarket contact enable a firm to respond to an aggressive action by a multipoint rival in markets other than the one in which the action takes place. That possibility raises the potential costs of aggressive moves and serves as a credible deterrent, especially if a firm can respond in several markets. In addition, multipoint competition helps firms to interpret their rivals' intentions and signal their own, reducing the likelihood of costly misunderstandings.
The authors elaborate on those ideas to examine how a hospital's degree of intermarket contact with its competitors in a particular service market affects the likelihood that it will exit that market. They find that hospitals are less likely to exit markets in which they meet large numbers of their multipoint rivals. As a result of mutual forbearance, competitive rivalry is reduced across the markets that multipoint rivals share, lessening the types of pressures that typically prompt market exit. With lower levels of competitive rivalry, markets shared by multipoint rivals are relatively more hospitable environments in which to operate and are less likely to be exited. Rather than competing intensely, multipoint rivals appear to adopt a “live and let live” approach toward each other.
The fact that multipoint contact across markets may lessen competitive pressures within individual markets has implications for the contact between firms in several settings. Multimarket contact can occur across different product or service markets and also across different geographic markets, thus affording an intriguing perspective for the investigation of the rivalry between emerging transnational firms. True transnationals, by successfully integrating global operations while still addressing local market concerns, have been seen by some as having the capabilities necessary for successful performance in international competition. Perhaps transnational firms, because they have an integrated decision-making structure, can coordinate their actions to reduce competitive rivalry with each other across the markets they share. If so, markets dominated by transnationals may become more stable than the current state of international competition would predict.
Despite the extensive literature on top management team structure (demographics), disagreement persists as to whether specific aspects of team structure have, on the whole, positive or negative results for the firm. The author addresses conflicts in the literature by using several typical structural measures in different contexts.
Shorter-tenured, heterogenous teams are found to provide the skills needed to address environmental complexities and will be more productive in turbulent environments because they deliver problem solving skills and new perspectives on strategic formulation and implementation processes. Longer-tenured, homogeneous teams are found to be more productive in stable environments because they will promote basic team maintenance functions (socialization, cohesion, etc.). Firms that are the most successful financially are ones that match their team structures to the environmental context over time. The results reported are unique because time, different contexts, and financial performance were combined to assess the interaction of top management teams with their environments.
Surprisingly, the type of turbulence encountered in the firm's context may determine whether a specific element of team structure will be beneficial or detrimental to financial performance. Relatively high levels of constant environmental change require different team structures than unusual, disruptive change. Differences are discussed.
An important practical problem for many managers is finding alternative processes for performing a desired task, for example, one that is more efficient, cheaper, or that is automated or enhanced by the use of information technology. Improving processes also poses theoretical challenges. Coordination theory provides an approach to the study of processes. In this view, the design of a process depends on the coordination mechanisms chosen to manage dependencies among tasks and resources involved in the process.
In this paper, I use coordination theory to analyze the software change process of a large mini-computer manufacturer. Mechanisms analyzed include those for task assignment, resource sharing, and managing dependencies between modules of source code. For each, I suggest alternative mechanisms and thus alternative designs for the process. The organization assigned problem reports to engineers based on the module that appeared to be in error, since engineers only worked on particular modules. Alternative task assignment mechanisms include assignment to engineers based on workload or market-like bids. Modules of source code were not shared, but rather “owned” by one engineer, thus reducing the need for coordination. An alternative resource sharing mechanism would be needed to manage source code if multiple engineers could work on the same modules. Finally, engineers managed dependencies between modules informally, relying on their personal knowledge of which other engineers used their code; alternatives include formally defining the interfaces between modules and tracking their users.
Software bug fixing provides a microcosm of coordination problems and solutions. Similar coordination problems arise in most processes and are managed by a similar range of mechanisms. For example, diagnosing bug reports and assigning them to engineers may have interesting parallels to diagnosing patients and assigning them to specialists.
While the case presented does not formally test coordination theory, it does illustrate the potential of coordination theory for exploring the space of organizational processes. Future work includes developing more rigorous techniques for such analyses, applying the techniques to a broader range of processes, identifying additional coordination problems and mechanisms and developing tools for collecting and comparing processes and automatically suggesting potential alternatives.
The authors identify the key organizational and environmental characteristics that influence the effectiveness and efficiency of publicly funded service organizations. In a study of 40 community mental health centers (CMHCs), they used fulfillment of community needs as a measure of effectiveness and utilization of various services as a measure of efficiency. The results indicate that client educational status, state facility utilization, minority population, personnel expense, management type, and board composition affect need fulfillment. The study also illuminates the relationship between efficiency and effectiveness of publicly funded service organizations. The findings suggest that the allocation of resources to these organizations from local, state, and federal governments tends to he based on the extent of unmet needs for services. That is, the less the publicly funded service organization meets community needs, the more government funds are allocated to meet the needs. If the unmet needs that stimulate higher levels of funding actually reflect inefficiency, the inverse relationship between effectiveness and efficiency suggests that the government's resource allocation may not be based on performance, but may in fact be rewarding inefficiency. The findings suggest that legitimacy does not enhance efficiency and that legitimacy and efficiency may be entirely independent, which is consistent with institutional theory. The study results will be of practical use to community leaders, taxpayers, consumer advocates, regulatory agencies, and managers of community mental health organizations.
Essay about Organization behavior from the point of view of community building in the sense of shared values, congruent interests, cohering rituals, and a common purpose.

It is London 1856. William Henry Perkin serendipitously invents the first synthetic dye while he is trying to synthesize quinine, a medicine for malaria. The nineteen-year-old Perkin leaves the Royal College of Chemistry and quickly commercializes his aniline purple dye, launching the synthetic dye industry. From that time on, the industry continues to dazzle the eye with ever new and appealing dye colors. Perkin, along with entrepreneurs from Britain and France, dominates the synthetic dye industry for the next eight years. During this period, British and French firms introduce most other innovative synthetic dyes onto the market, and they hold the largest global market share.

The beginning of a new millennium provides a welcome opportunity to take stock of the accomplishments, open questions, and most promising research avenues of evolutionary models in management and organization theory. Johann Peter Murmann has invited Howard Aldrich, Daniel Levinthal, and Sidney Winter to appraise the state of the art in evolutionary research and where scholarly efforts should go in the new millennium. The panel also clarified their positions by answering questions that Johann Peter Murmann solicited from the scholarly community in response to the panel's dialogue.