Strategic orientations, incentive plan adoptions, and firm performance: evidence from electric utility firms

Article Abstract:

A study was conducted to examine the impact of the fit between the strategic orientation and the incentive plan of a business on its performance. The context of this research is the electric utility sector from 1988 to 1992, during which incentive schemes were introduced for the first time. The study analyzed data from 50 electric utilities using a pooled, cross-sectional, time series research design. Findings revealed that firms oriented toward Defender strategies experienced improved performance when annual bonus schemes involving cash incentives and accounting performance measures were used. Moreover, firms that preferred Prospector strategies were able to improve their performance when stock-based incentive packages and market-based performance measures were used.

Electric Utilities, Electric Power Generation, Transmission and Distribution, Electric services, Compensation and benefits, Stock options, Incentives (Business)

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Cooperative strategy and new venture performance: the role of business strategy and management experience

Article Abstract:

A study is conducted to determine how the performance of new ventures is affected by the experience of the management team, its choice of competitive strategy and its use of different cooperative schemes. Data are gathered from 210 high-technology firms. The new ventures selected for the study have made an initial public offering (IPO) between 1980 and 1989, have been an independent startup, have been incorporated less than eight years before the IPO, have been led by the founding management team during the IPO and have been selling actual products. Moderated regression analysis is then performed. Results show that cooperative arrangements are most effective in new ventures managed by teams having the most experience. Implications are discussed.

Industrial cooperation

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Strategy making as iterated processes of resource allocation

Article Abstract:

The Bower-Burgelman process model of strategy making in a large, complex organization is extended by applying it to the comparative analysis of a single business across different firms, as opposed to different types of businesses within a single firm. The study investigates the multilevel managerial activities that compel firms presented with similar new business opportunities to acknowledge with different strategic commitments. The study focuses on the opposing experiences of BellSouth and U S WEST in newly developing and expanding wireless communications businesses during the 1983-94 timeframe. Results confirm that it is beneficial to conceptualize strategy making in a large, complex firm as an iterated process of resource allocation.

Radiotelephone communications, Cellular Mobile Radio Services, Cellular and Other Wireless Telecommunications, Telecommunications services industry, Telecommunications industry, Cellular telephone services, Resource allocation

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