Multimarket competition has become a substantial part of the modern economy. As such, it has drawn the attention of academics in both economics and strategy fields. Many studies have found empirical evidence of mutual forbearance in several industries, but despite its importance, its behavioral roots have not been explored. In my dissertation I integrate the reality of boundedly-rational decision makers into the mutual forbearance hypothesis. I apply an outgrowth of the behavioral theory of the firm – the shifting focus model of risk taking – to the study of competitive behavior. I propose a behavioral model of multimarket competition that focuses on corporate strategic decisions - market entry and exit decisions, regardless of entry mode (e.g. acquisitions) or exit mode (e.g. divestitures). This approach provides a granular view of changes in the business scope of the firms in terms of product and geographic markets served. I test my hypotheses in the U.S. property liability insurance industry over a 12-year period (1998-2008). I argue that firms follow the mutual forbearance logic as long as their performance goals are satisfied. However, under conditions of adversity, firms shift attention to recovering from the performance shortfall and their actions deviate from the mutual forbearance predictions. This dissertation shows that underperforming firms with abundant slack take longer to forbear, and underperforming firms with limited slack start forbearing sooner, as predicted. By bridging behavioral and competitive perspectives to the study of market entry and exit decisions, I underscore the value of cross-fertilization in strategy research.

Multimarket competition has become a substantial part of the modern economy. As such, it has drawn the attention of academics in both economics and strategy fields. Many studies have found empirical evidence of mutual forbearance in several industries, but despite its importance, its behavioral roots have not been explored. In my dissertation I integrate the reality of boundedly-rational decision makers into the mutual forbearance hypothesis. I apply an outgrowth of the behavioral theory of the firm – the shifting focus model of risk taking – to the study of competitive behavior. I propose a behavioral model of multimarket competition that focuses on corporate strategic decisions - market entry and exit decisions, regardless of entry mode (e.g. acquisitions) or exit mode (e.g. divestitures). This approach provides a granular view of changes in the business scope of the firms in terms of product and geographic markets served. I test my hypotheses in the U.S. property liability insurance industry over a 12-year period (1998-2008). I argue that firms follow the mutual forbearance logic as long as their performance goals are satisfied. However, under conditions of adversity, firms shift attention to recovering from the performance shortfall and their actions deviate from the mutual forbearance predictions. This dissertation shows that underperforming firms with abundant slack take longer to forbear, and underperforming firms with limited slack start forbearing sooner, as predicted. By bridging behavioral and competitive perspectives to the study of market entry and exit decisions, I underscore the value of cross-fertilization in strategy research.

One neglected yet very important feature of family business is its internal homogeneity. Different from heterogeneity which focuses on differences across family firms, homogeneity here refers to the continuity and similarity of decision-making patterns either over time or across business units in a single family firm. This dissertation attempts to explore homogeneity in family businesses as well as its antecedents and performance consequences. To distinguish different types of homogeneity, strategic persistence is defined as homogeneity of strategic patterns over time and the pursuit of a dominant strategy as the homogeneity across related business units. Based upon S&P 1500 manufacturing firms from 1996 to 2013, it is found that family firms have a higher level of strategic persistence and a more consistent dominant strategy than nonamily firms. In addition, it appears that being older, with less organizational slack and having higher family involvement in ownership and management tends to strengthen the two kinds of homogeneity in family businesses. Finally, it is found that high homogeneity in decision-making can result in better performance in family business compared to nonamily firms, especially for those with high family involvement in management. Theoretical implications and limitations are discussed.

<p>Organizational Capital Budgeting Model (OCBM) is a general theory of capital budgeting that incorporates traditional capital budgeting theories and the consideration about firm's information/ organization structure. The traditional financial capital budgeting model is a special case of OCBM. Therefore, OCBM not only broadens the traditional model, but also explains the heterogeneous behaviors of firms using quasi/non-financial version of capital budgeting. I demonstrate the validity of OCBM with multiple research methods. The field studies about Asian conglomerates are carefully constructed. The conglomerates are important dataset to study organizational decision making because of their size, scope, controversial behaviors and global presence.</p> / Dissertation

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Cette thèse étudie la façon dont l’atteinte ou non des objectifs et la gouvernance influencent la direction du changement organisationnel – en termes d’exploration et d’exploitation - et analyse l’impact de ces effets sur la performance de l’entreprise au fil du temps. Dans un premier temps, je procède à une analyse détaillée de la littérature sur le Corporate Venture Capital afin de positionner mon propre travail de recherche dans le champs considéré et confirmer l’originalité de mes contributions. Ensuite, dans la première étude, j’examine comment la non-atteinte des objectifs fixés influe sur la direction du changement organisationnel mis en oeuvre dans l'entreprise, et étudie la façon dont ces changements sont influencés par la place qu’occupent les actionnaires stables ou passagers dans le capital de l’entreprise. Dans la seconde étude, je vérifie empiriquement la validité des propositions formulées en examinant les investissements de corporate venture capital (CVC) réalisés par un échantillon d’entreprises ayant une forte activité CVC. Enfin, l'équilibre entre exploration et exploitation au fil du temps, ainsi que les caractéristiques des oscillations entre ces deux types d’activités sont examinés dans la troisième étude constituant cette thèse. Les analyses empiriques portent sur les investissements de CVC effectués par 286 entreprises des États-Unis sur la période 1993-2013. Cette thèse contribue à la théorie comportementale de l’entreprise (Behavioral Theory of the Firm) en examinant la façon dont la structure du capital et l’actionnariat influe sur la prise de décisions en matière d’innovation et de changement. En étudiant la façon dont l'inertie organisationnelle et les phases de changement affectent les activités d'exploitation et d'exploration, cette thèse contribue aussi à la recherche sur l’ambidextrie organisationnelle. Pour finir, ce travail participe à la recherche sur le corporate venture capital au travers de l’étude des antécédents et des conséquences des activités d'exploration et d’exploitation dans le cadre de l’investissement CVC. / This dissertation addresses unexplored issues on the antecedents, management, and outcomes of corporate venture capital (CVC). More specifically, I examine how negative performance feedback and corporate governance influence the direction of organizational change ˗ in terms of exploration and exploitation ˗ and how balancing such change over time influences firm performance in the CVC context. I first review the extant literature on CVC and lay out the unique contributions of my research. Then, in the first essay, I theorize on how poor firm performance influences the resource allocation decisions on exploration and exploitation and how such decisions are affected by the concentration of dedicated and transient shareholders and by the board of directors' monitoring and advising intensities. In the second essay, I empirically examine how the resource allocation decisions on exploration and exploitation are influenced by dedicated and transient shareholders in the context of CVC investing. In the third essay, I examine how balancing exploration and exploitation over time and the characteristics of oscillation impact firm performance. The empirical analysis in the latter two essays is based on CVC investments made by 286 U.S. companies during 1993-2013. This dissertation contributes to the Behavioral Theory of the Firm and Corporate Governance research by introducing how shareholders and boards influence managerial decision-making in search and change, Ambidexterity research by studying how continuous change and organizational inertia impact temporal spillover between exploration and exploitation, and CVC research by examining the antecedents and consequences of explorative and exploitative initiatives in CVC investing.