Chain Affiliation and Human Resource Investments: Evidence from the Restaurant Industry

Drawing on organizational theory, agency theory, and research in strategic human resource management, this study explores how chain affiliation influences human resource (HR) investments using data from a nationally random survey of restaurant establishments. We propose that chain-affiliated units will make different investments in those areas of the HR system where chains establish superior organizational routines compared with nonaffiliated units. By contrast, we argue that in the absence of chain routines, ownership incentives will drive differences in human resource investments. Specifically, we find that franchisee-owned units focus more on cost reduction by underinvesting in human resource practices compared with company-owned units and independently owned units when organizational routines are not provided by the chain. We provide further support for our theoretical arguments using additional data on multiunit ownership and franchisor influence. Finally, we conduct supplemental analyses to explore the relationship between different human resource investments and two important organizational outcomes: employee turnover and customer satisfaction ratings from Yelp. Our results highlight the types of human resource practices that are important for service work and suggest that the provision of organizational routines can have important implications for the long-run success of chains and their units.

A Star Is Born: The Relationship Between Performance and Achieving Status Through Certification Contests in the Context of Equity Analysts

We investigate how the relationship between status and performance decouples over time by addressing two questions: (1) how performance affects the likelihood that an actor achieves high status and (2) how achieving high status affects the actor’s subsequent performance. In doing so, we focus on the role repeated certification contests play, where evaluators assess actors’ performance along particular dimensions and confer high status on the contest winners. Using the context of sell-side (brokerage) equity analysts and the “All-Star” list from Institutional Investor magazine, we first investigate whether analysts who make the All-Star list are more likely to produce accurate and/or independent forecasts. Then, we investigate analyst performance after recent and multiple wins. Our results demonstrate the decoupling of status and performance over time and the roles played by both the high-status actor and the social evaluators conferring their status. Whereas analyst performance increases the likelihood of being designated an All-Star, recent and multiple All-Star designations differentially affect both how subsequent performance is assessed, and how the All-Star analysts subsequently perform. In the short term, achieving high status can increase performance and solidify an analyst’s status position; however, in the long term, it can lead to lower performance and eventually result in status loss, which further erodes performance.

Going Alone or Together? A Configurational Analysis of Solo Founding vs. Cofounding

Research and practice suggest that cofounded ventures outperform solo-founded ventures. Yet, little work has explored the conditions under which solo founding might be preferable to cofounding. Combining an inductive case-oriented analysis with a Qualitative Comparative Analysis of 70 new entrepreneurial ventures, we examine why and how solo founders can be as successful as their peers in cofounded ventures. We find that successful solo founders strategically use a set of cocreators rather than cofounders to overcome liabilities, retain control, and mobilize resources in unique and unexpected ways. A primary contribution of this paper is an emergent configurational theory of entrepreneurial organizing. Overall, we reveal the broader significance and theoretical importance of adopting a configurational lens for both practitioners and scholars of entrepreneurship.

Green to Gone? Regional Institutional Logics and Firm Survival in Moral Markets

A growing body of scholarship studies the emergence of moral markets—sectors offering market-based solutions to social and environmental issues. To date, researchers have largely focused on the drivers of firm entry into these values-laden sectors. However, we know comparatively little about postentry dynamics or the determinants of firm survival in moral markets. This study examines how regional institutional logics—spatially bound, socially constructed meaning systems that legitimize specific practices and goals within a community—shape firm survival in emerging moral markets. Using a unique panel of firms entering the first eight years of the U.S. green building supply industry, we find that (1) a regional market logic amplifies the impacts of market forces by increasing the positive impact of market adoption and the negative impact of localized competition on firm survival, (2) a regional proenvironmental logic dampens the impacts of adoption and competition on firm survival, and (3) institutional complexity—the co-occurrence of both market and proenvironmental logics in a region—negates the traditional advantages of de alio (diversifying incumbent) firms, creating an opportunity for de novo (entrepreneurial entrant) firms to compete more effectively. Our study integrates research on industry emergence, institutional logics, and firm survival to address important gaps in our knowledge regarding the evolution and growth of environmental entrepreneurship in moral markets.

External Interfaces or Internal Processes? Market Positioning and Divergent Professionalization Paths in Young Ventures

We explore how the initial market positioning of entrepreneurial ventures shapes how they professionalize over time, focusing specifically on the development of functional roles. In contrast to existing literature, which presumes a uniform march toward professionalization as ventures scale and complete developmental milestones, we advance a contingent perspective, distinguishing between the development of external interface functions (marketing & sales and customer development) and internal process functions (accounting, human resources, and finance). Specifically, we argue that positioning in an unconventional market space raises demand for external engagement that focuses ventures’ attention and resources toward developing external interface roles. At the same time, such unconventional ventures are less apt to elaborate their internal process roles relative to more conventional peers. We test these predictions using a novel longitudinal data set on the internal organizations of 3,748 U.S.-based entrepreneurial ventures. In contrast to common assumptions of convergent professionalization, our theory and findings advance the perspective that ventures pursue divergent professionalization paths based on their initial market positioning as they scale up.

To Engage or Not to Engage with AI for Critical Judgments: How Professionals Deal with Opacity When Using AI for Medical Diagnosis

Artificial intelligence (AI) technologies promise to transform how professionals conduct knowledge work by augmenting their capabilities for making professional judgments. We know little, however, about how human-AI augmentation takes place in practice. Yet, gaining this understanding is particularly important when professionals use AI tools to form judgments on critical decisions. We conducted an in-depth field study in a major U.S. hospital where AI tools were used in three departments by diagnostic radiologists making breast cancer, lung cancer, and bone age determinations. The study illustrates the hindering effects of opacity that professionals experienced when using AI tools and explores how these professionals grappled with it in practice. In all three departments, this opacity resulted in professionals experiencing increased uncertainty because AI tool results often diverged from their initial judgment without providing underlying reasoning. Only in one department (of the three) did professionals consistently incorporate AI results into their final judgments, achieving what we call engaged augmentation. These professionals invested in AI interrogation practices—practices enacted by human experts to relate their own knowledge claims to AI knowledge claims. Professionals in the other two departments did not enact such practices and did not incorporate AI inputs into their final decisions, which we call unengaged “augmentation.” Our study unpacks the challenges involved in augmenting professional judgment with powerful, yet opaque, technologies and contributes to literature on AI adoption in knowledge work.

The Role of Resources in the Success or Failure of Diverse Teams: Resource Scarcity Activates Negative Performance-Detracting Resource Dynamics in Social Category Diverse Teams

Increasing the social category diversity of work teams is top of mind for many organizations. However, such efforts may not always be sufficiently resourced, given the numerous resource demands facing organizations. In this paper, we offer a novel take on the relationship between social category diversity and team performance, seeking to understand the role resources may play in both altering and explaining the performance dynamics of diverse teams. Specifically, our resource framework explains how the effects of social category diversity on team performance can be explained by intrateam resource cognitions and behaviors and are dependent on team resource availability. We propose that in the face of scarcity in a focal resource (i.e., budget), diverse (but not homogenous) teams generalize this scarcity perception to fear that all resources (i.e., staff, time, etc.) are scarce, prompting performance-detracting power struggles over resources within the team. We find support for our model in three multimethod team-level studies, including two laboratory studies of interacting teams and a field study of work teams in research and development firms. Our resource framework provides a new lens to study the success or failure of diverse teams by illuminating a previously overlooked danger in diverse teams (negative resource cognitions (scarcity spillover bias) and behaviors (intrateam power struggles)), which offers enhanced explanatory power over prior explanations. This resource framework for the study of team diversity also yields insight into how to remove the roadblocks that may occur in diverse teams, highlighting the necessity of resource sufficiency for the success of diverse teams.

Alternative Futures for the Digital Transformation: A Macro-Level Schumpeterian Perspective

This paper develops and deploys a theoretical framework for assessing the prospects of a cluster of technologies driving what is often called the digital transformation. There is considerable uncertainty regarding this transformation’s future trajectory, and to understand and bound that uncertainty, we build on Schumpeter’s macro-level theory of economy-wide, technological revolutions and on the work of several scholars who have extended that theory. In this perspective, such revolutions’ trajectories are shaped primarily by the interaction of changes within and between three spheres—technology, organization, and public policy. We enrich this account by identifying the critical problems and the collective choices among competing solutions to those problems that together shape the trajectory of each revolution. We argue that the digital transformation represents a new phase in the wider arc of the information and communication technology revolution—a phase promising much wider deployment—and that the trajectory of this deployment depends on collective choices to be made in the organization and public policy spheres. Combining in a 2 × 2 matrix the two main alternative solutions on offer in each of these two spheres, we identify four scenarios for the future trajectory of the digital transformation: digital authoritarianism, digital oligarchy, digital localism, and digital democracy. We discuss how these scenarios can help us trace and understand the future trajectory of the digital transformation.

Victorious and Hierarchical: Past Performance as a Determinant of Team Hierarchical Differentiation

Hierarchies emerge as collectives attempt to organize themselves toward successful performance. Consequently, research has focused on how team hierarchies affect performance. We extend existing models of the hierarchy-performance relationship by adopting an alternative: Performance is not only an output of hierarchy but also a critical input, as teams’ hierarchical differentiation may vary based on whether they are succeeding. Integrating research on exploitation and exploration with work on group attributions, we argue that teams engage in exploitation by committing to what they attribute as the cause of their performance success. Specifically, collectives tend to attribute their success to individuals who wielded greater influence within the team; these individuals are consequently granted relatively higher levels of influence, leading to a higher degree of hierarchy. We additionally suggest that the tendency to attribute, and therefore grant more influence, to members believed to be the cause of success is stronger for teams previously higher (versus lower) in hierarchy, as a higher degree of hierarchical differentiation provides clarity as to which members had a greater impact on the team outcome. We test our hypotheses experimentally with teams engaging in an online judgement task and observationally with teams from the National Basketball Association. Our work makes two primary contributions: (a) altering existing hierarchy-performance models by highlighting performance as both an input and output to hierarchy and (b) extending research on the dynamics of hierarchy beyond individual rank changes toward examining what factors increase or decrease hierarchical differentiation of the team as a whole.

Institutional Investor Activism and Employee Safety: The Role of Activist and Board Political Ideology

Although prior research on shareholder activism has highlighted how such activism can economically benefit the shareholders of targeted firms, recent studies also suggest that shareholder activism can economically disadvantage nonshareholder stakeholders, notably employees. Our study extends this research by exploring whether shareholder activism by institutional investors (i.e., institutional investor activism) can adversely affect employee health and safety through increased workplace injury and illness. Furthermore, deviating from the assumption that financially motivated institutional investor activists are homogeneous in their goals and preferences, we investigate whether the influence of institutional investor activism on employee health and safety hinges on the political ideology of the shareholder activist and of the board of the targeted firm. Using establishment-level data, we find that institutional investor activism adversely influences workplace injury and illness at targeted firms and that this influence is stronger for nonliberal shareholder activists and for firms with a nonliberal board. Our study contributes to shareholder activism research by highlighting how the political ideology of shareholder activists and boards affects the impact of shareholder activism on stakeholders and how shareholder activism can adversely affect the health and safety of employees. Furthermore, our paper also contributes to research on workplace safety and the management of employee relations and human capital resources by highlighting the detrimental effect of a firm’s ownership by investor activists on its employees and how the board’s political ideology may enable a firm to reduce this risk.