Abstract
This study examines the cross-level effect of group-level managers on member firms' problemistic search in hierarchical business groups. Usingmultilevel data from Korean business groups, we propose that the effects of failure to meet an aspiration level on R&D search intensity increase when member firm performance and R & D investments are more cognitively accessible to group-level managers. Specifically, we find, first, that when underperforming firms are widespread in a business group, a focal member firm intensifies R & D search in response to performance below an aspiration level because member firm performance, as a group-level problem, becomes cognitively accessible to group-level managers. Second, asmember firms operating in R & D intensive industries aremore prevalent in a business group, R&D investments, as a search solution, becomemore cognitively accessible to group-level managers. Thus, a focal member firm reinforces R & D search in response to the performance shortfall. We discuss the implications of these findings for research on the behavioral theory of the firm and performance feedback.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 51-69 |
| Number of pages | 19 |
| Journal | Organization Science |
| Volume | 30 |
| Issue number | 1 |
| DOIs | |
| State | Published - Jan 1 2019 |
| Externally published | Yes |
Keywords
- Attention-based view
- Cognitive accessibility
- Hierarchical business groups
- R & D search behavior
ASJC Scopus subject areas
- Strategy and Management
- Organizational Behavior and Human Resource Management
- Management of Technology and Innovation