Research
Published Work
Market Segment, Organizational Form, and Information Technology Fit
With Victor Bennett and Ines Black
Several literatures in strategy propose models of the displacement of incumbent firms by newer firms that adopt newer technologies. Although that pattern likely plays out often, it is also often the case that incumbents adopt new technologies less intensively than entrants and yet, are not displaced; the new and old firms coexist. We propose one explanation built on the fundamental notion in strategy of the importance of fit between activity system components. We combine three existing models from strategy in a way that allows us to generate novel predictions. When corroborated, these predictions suggest that the patterns we observe are likely the result of issues of multidimensional fit and cannot be explained by a simpler model. One model predicts that market segment choice is a function of the order of entry. A second suggests that organizational form must fit with market segment choice, and a third suggests that information technology adoption returns depend on organizational form. Jointly, these models produce a chain of logic explaining why early entrants might be less likely to adopt information technology. The combined model also yields a novel prediction about when we expect this pattern to emerge. Specifically, in settings without a sufficiently large scope for product customization or the possibility of variation in organizational form, we predict that the relationship between entry order and technology adoption is attenuated. We find patterns consistent with our predictions using rich employer-employee linked administrative data from Portugal.
Keywords: Organizations, Software, Complements, Technology adoption, Entry
Citation: Bennett, V. M., Black, I., & Hall, T. A. (2023) Market Segment, Organizational Form, and Information Technology Fit. Strategy Science 9(1):38-57.
Organizational decision-making and the returns to experimentation
With Sharique Hasan
Many organizations have embraced formal experimentation, i.e., A/B testing, to improve the performance of their products and services. Experimentation, some have argued, should democratize innovation inside organizations by creating a platform to test new ideas, regardless of origin. In this article, we argue that experimentation’s promise hinges on having the proper organizational decision-making process that encourages innovation while mitigating the risk of unanticipated failures. We study this question by developing a model of experimentation inside organizations, where decisions to implement are either centralized or decentralized—a tension identified by practitioners and scholars alike. Organizations with centralized mechanisms that rely too much on the input of other teams benefit least from experimentation, as do ones with completely decentralized ones. In contrast, organizations with mostly decentralized decisions, with a single authority that sets consistent thresholds for implementation, achieve growth but with less downside risk. Thus, without considering the organizational decision-making structure, the benefits of experimentation may be limited.
Keywords: Experimentation, Digitization, Organizations, Decision-making
Citation: Hall, T. A., & Hasan, S. (2022). Organizational decision-making and the returns to experimentation. Journal of Organization Design, 11(4), 129-144.
Software Availability and Entry
With Victor Bennett
What happens to market structure as an industry's operations lean ever more on software? We find that software availability is associated with an increase in entry and an increase in exit by the oldest and most established firms. We suggest three potential mechanisms and, through post hoc analysis, determine which is most consistent with observed patterns. We find the effect of software availability on entry is stronger in settings with more available IT talent, more permissive labor policies, and greater demand uncertainty. Observed patterns are most consistent with software enhancing labor productivity and thus reducing exposure to uncertainty.
Keywords: Digitization, Entrepreneurship, Entry, Scaling, Software
Citation: Bennett, V. M., & Hall, T. A. (2020). Software availability and entry. Strategic Management Journal. 41(5). 950-962
Selected Working Projects
Teams and Technology Transitions
With John Gardner, Jonathan Eaton, and Zachary Wright
Managers increasingly need to understand how humans interact with technologies and one another as they strive to improve performance, particularly in teams. Technologies like artificial intelligence (AI) revolutionize the division of labor between humans and technology. The adaptivity and connectivity of these technologies suggest that they are likely to affect coordination and relationships more dramatically than past technological revolutions. As these technologies diffuse, it is unclear if they will stymie or stimulate teamwork and performance. To explore this question, we use three unique lab experiments in which three-person teams operate a simulated factory. We first study how individuals in teams interact in different phases of technology adoption. We then perform a second exploratory experiment to uncover mechanisms driving changes in team relationships and coordination. Finally, we replicate and extend our first study to gain insight into our initial results; we also provide quantified evidence of the mechanisms uncovered in the exploratory study. The results clarify the effects of AI on team performance and relational coordination, enumerate ways that people interact with AI and each other, and put forth theory to explain why these phenomena occur. The insights provide direction for both practice and theory for balancing technology, relationships, and performance.
Keywords: Teams, Coordination, Relationships, AI, Technological change
When can Solo Founders Thrive?
With Travis Howell
The conventional wisdom both in research and in practice is that entrepreneurs need co-founders, as they bring crucial resources to new ventures. Yet, this same work also suggests that co-founders introduce destructive conflict to new ventures, potentially creating as many problems as they solve. Surprisingly, little work examines the counterfactual – i.e., the conditions under which solo-founding might be a viable approach. In this paper, we address this gap. To answer our research question, we rely on a dataset of all 3,000+ ventures an accelerator program from 2005 to 2022. We find evidence of multiple ways in which solo founders can attenuate their performance disadvantage. Overall, our paper makes contributions to the literatures on founding teams, organizational design, and organizational scaling.
Keywords: Founding teams, organizational design, entrepreneurship, accelerators
Mechanical Movie Making: Organizational Search in the Streaming Era
Organizational search always involves some level of uncertainty. However, organizations are using new access to large quantities of data (i.e., “big data”) to attempt to reduce the uncertainty of their search. For example, organizations can use data on past product performance to predict the performance of similar potential future products, or they can also use data on customer preferences to create better matches between products and customers. Using big data to reduce the uncertainty of organizational search could result in more local or distant search. I develop a computational model to explore how using data to predict performance and match products with customers affects the frequency of distant search and performance. I then use data on the movie industry to study how the novelty, collaboration, and performance of movies changed after the introduction of streaming services and the subsequent increase in data available to studios.
Keywords: Organizational search, big data, organizational design
Information technology and the changing nature of management
Managerial work has become increasingly digitized as organizations have adopted information technology (IT) relevant to managers. Conventional wisdom has suggested that this wave of computerization has augmented and substituted for manager work, allowing for broader managerial span of control. However, previous work has not accounted for the possibility that IT adoption has changed the nature of management. As organizations adopt new technologies, they often redesign the jobs of users of those technologies. It is possible that changes in manager job designs may offset the augmenting and substituting effects of IT. I find evidence suggesting that job design moderates the IT-span of control relationship using data on hospital divisions, IT adoption, and occupational job designs. I also find that this moderating effect does not exist among higher level managers and organizations with significant cost constraints. Additionally, I present evidence that the mechanism underlying this moderating effect is increases in the social characteristics of the job designs of some managerial occupations. Finally, I explore the implications of these changes for manager salaries and promotion rates.
Keywords: Managers, Technology adoption, Span of control, Organizational Design
The Modern Manager: The Adoption of Emerging Management Practices and Firm Performance
When new management practices emerge, organizations decide if and when to adopt them. Adoption timing relative to competitors may determine the returns to adoption. Previous attempts to study this phenomenon have produced a variety of predictions and results. In this study, I reconcile prior predictions and results by proposing an inverted-U relationship between emerging management practice adoption timing and firm performance, based on the extent and speed of industry practice diffusion. I present evidence of this relationship using a case study of Agile Marketing adoption from data on job postings for marketing managers of public firms. These findings highlight the importance of competition, learning, legitimacy, and feedback loops in achieving positive returns to adoption and the temporary nature of competitive advantages based on management practices.
Keywords: Managers, Management practice adoption, Human capital, Future of work