Research Summary Entrepreneurs make critical decisions in uncertain environments where information is limited, outcomes are difficult to predict, and multiple goals often compete. Yet, existing research offers scattered insights into how entrepreneurs dynamically adapt to such contexts and how their decisions are shaped by behavioral and cognitive foundations such as judgment, intuition, and experience. We shed light on these phenomena by exploring how decision-making is influenced by factors at multiple levels, from individual traits and family dynamics to team interactions and organizational structures. A key aspect of our inquiry focuses on how entrepreneurs manage uncertainty by balancing economic goals, such as growth and profitability, with non-economic objectives like social impact, sustainability, or knowledge advancement. By integrating these perspectives, this work offers a conceptual framework that connects antecedents, processes, and outcomes of entrepreneurial decision-making under uncertainty and competing goals, providing a promising roadmap for future research. Managerial Summary: Entrepreneurs often make decisions in uncertain environments, where they must contend with limited information and competing goals. This work explores how entrepreneurs balance economic objectives, such as profit, with non-economic ones, like satisfying various stakeholders, achieving social impact, and sustainability. It highlights the role of individual, family, team, and organizational factors in shaping these decisions, offering novel insights into how entrepreneurs can manage trade-offs, adapt feedback-based strategies, and recalibrate priorities over time. For owners, managers, and business leaders, understanding these dynamics can lead to better decision-making, improved risk management, enhanced strategic alignment, increased innovation, and a more balanced approach to growth.

Building on social identity theory, we theorize and find that in a merger, paired family firms are better able to retain employees and improve post-merger performance compared to other merger pairs. We contribute to social identity theory by theorizing better post-merger performance as mediated by job security for family firm combinations. We also contribute to the job security and merger and acquisition literature by examining how job security and post-merger performance vary based on the paired social identity of owners. In addition to identity similarity, the type of identity also matters in mergers. We argue that family owner social identity similarity fosters greater integration between merging parties while allowing family owner pairs to retain some autonomy through their employees, thereby maximizing post-merger performance. Our data on private Swedish firms, complemented by 11 qualitative interviews across five countries and three continents, confirm that family mergers outperform other merger combinations via job security. In a supplementary critical experiment examining industry dissimilarity, we compare the socioemotional wealth perspective-which emphasizes loss aversion and predicts family firms' unrelated diversification avoidance-to social identity theory. Consistent with social identity theory, our results show that both job security and postmerger performance improve with unrelated family firm mergers.

Our objective is to provide an overview of implementation issues for firms and entrepreneurs seeking to create a multi-sided platform market enterprise. Our paper is differentiated from other work in the area by offering a stage model providing an implementation overview of issues associated with such multi-sided platform market firms. Stage 1 discusses essential implementation issues from entrepreneurial initiation to critical mass, where the network is stable enough to support both market sides (supplies and participants). Stage 2 explores strategies for how such platform firms gain additional networks through building (from scratch), buying (acquisition) and allying (strategic alliances). In building our implementation model, we designate critical issues that practitioners need to consider to realize better execution. We initiate our paper by offering a set of opportunities that strategists and entrepreneurs can recognize to facilitate multi-sided platform firm strategy and implementation. Additionally, we offer numerous examples illustrating keys to success and pitfalls to avoid within our implementation stages. We further discuss challenges traditional firms face when seeking to implement a multi-sided platform strategy, regulatory challenges large multi-sided market firms face, and ethical dilemmas platform firms must overcome. In concluding our paper, we provide a summary of salient implementation challenges in each stage of our model as well as possible solutions. Finally, we propose future governance and ethical issues that still need to be fully addressed as platform firms evolve

How do firms overcome the challenge of absorbing distant knowledge? Scholars argue that organizations need knowledge that is distant from their existing knowledge base to create novel innovative output, whereas others argue, in contrast, that organizations need knowledge to be similar to the firm’s knowledge base in order to absorb it. We argue that organizations can improve their ability to identify and comprehend knowledge from a distant knowledge category through learning associations made by a category link—a familiar tangible component previously used by somebody else in the distant knowledge category. We test our arguments using a sample of patents in which the material graphene is used as a component across diverse patent classes (i.e., knowledge categories). We find that increasing experience with category-linking graphene enables an organization to patent in increasingly distant graphene-linked patent classes and also increases the number of patents in such classes. We also find that the extent to which category-linking graphene is prominent in a distant knowledge category enhances the effect of graphene experience on a firm’s ability to absorb knowledge from the distant knowledge category. We, thus, present a novel internal mechanism by which an organization can absorb distant knowledge.

Our research predicts different stakeholder engagement emphases through a CEO motivation-means contingency model. Drawing upon regulatory focus and power theories, we argue that higher levels of CEO prevention focus and informal power (firm experience, knowledge, and board connections) are associated with stronger primary stakeholder engagement, whereas higher levels of CEO promotion focus and formal power (CEO duality and equity ownership) are associated with stronger secondary stakeholder engagement. By analyzing a panel dataset of S&P 500 firms, we found support for our hypotheses. These findings accentuate our contributions by emphasizing the importance of considering both CEO motivation (regulatory focus) and means (power) to understand how CEOs' characteristics influence their firms' stakeholder engagement. Our study extends recent work in the strategy and upper echelons literatures by showing that executives' regulatory focus does not operate in a vacuum; rather, its effects on managerial decision-making and firm strategies are context-specific.

Management scholars have argued and demonstrated that firms use strategic noise as an anticipatory form of impression management to minimize the effect of a potential negative reaction to an event of interest. In this study, we contribute to the impression management literature by exploring how both positive and negative strategic noise may intercede in the process of reactive impression management. We argue that in reactive impression management, since firms already know the initial market reaction to a focal event, they can "strategically" release subsequent positive or negative strategic noise depending upon the direction and magnitude of the initial market reaction to the focal event. Using a sample of 7,575 mergers and acquisitions from 2001 to 2015 that represent our focal events, we find strong evidence to support our arguments.

CEOs' commitment to the status quo (CSQ) is a prominent psychological factor leading to their resistance to organizational change. In this study we focus on the moderating role of managerial power, a central element in strategic choice, in the relationship between CEOs' CSQ and corporate divestiture activity. Drawing from the resource dependence perspective of power, we identify multiple aspects of power (structural, ownership, prestige/social, and expert power) that reduce CEOs' resistance to corporate change arising from CSQ. This study contributes to the strategic leadership and organizational change literatures by underscoring the importance of considering how different power bases shape the decision making of top managers who may have tendencies to hold onto firm assets when the situation warrants change. With a better understanding of how various power bases may uniquely influence strategic outcomes in the presence of managerial psychological bias, we can more accurately assess the impact of power on firms' strategic actions.

The purpose of this article is to reinvigorate research in the intersection of corporate strategy and the theory of the firm in light of the rapid advancement of digital technologies. Using the theory of the firm as an interpretive lens, we focus our analysis on the implications of the emerging digital age for three broad domains of corporate strategy: (1) corporate (competitive) advantage, (2) firm scale, scope, and boundaries, and (3) internal structure and design. Recognizing that digitalization exacerbates ambiguity and paradoxes, we sketch foundational strategies for future research. We suggest that there is a need to develop knowledge that accounts for the new realities of the digital age, depending on whether the corporate strategy phenomena under investigation and the theories of the firm used to explain them, are existing or new. The article serves also as introduction to the Journal of Management Studies Special Issue on the topic.

Prior research has focused on the influence of long investors (e.g., institutional investors) on merger-and-acquisition (M&A) decisions. This study investigates the role of short sellers in shaping managerial acquisitiveness and M&A decision quality. Short sellers impose a downward pressure on stock prices by disseminating negative information to the market. Given that managerial wealth and job security hinge on stock prices, top managers respond to increased short selling by refraining from excessive M&A activities because M&As could provide opportunities for short sellers to spread negative information and dampen stock prices. Furthermore, the negative influence of short sellers on managerial acquisitiveness is enhanced by the market for corporate control as an external governance mechanism and by CEO equity ownership as an internal governance mechanism. When firms with increasing short selling do engage in M&As, they gain higher M&A announcement returns and operating performance. We test our hypotheses using firms in the S&P 1500 from 2002 to 2014 and find support for our arguments.

Abstract As a relatively young discipline, the field of strategic management has not been as stifled as some other fields by what might be called a “normal science straitjacket” of established theories and methods. Instead, interesting conversations have emerged, based on homegrown ideas and drawing from numerous other disciplines. In the first few decades, these conversations shifted like a pendulum from an internal organizational emphasis to a focus on the competitive environment, and back with an emphasis on the resource-based view. This chapter demonstrates how many of the recent interesting findings are based on moving the pendulum toward the center, applying external perspectives to internal questions, and vice versa. The chapter provides examples of this phenomenon for a number of external and internal topics that are important to solving important strategic challenges. It also highlights promising research questions in these areas that have yet to be adequately addressed.

The Uppsala model has been widely used to explain variations in firms’ internationalization speed by focusing on foreign networks. To correct a potential geographic blind spot in the Uppsala model, we add a domestic dependency network viewpoint, concentrating upon political and business ties with domestic network actors, based upon resource dependence theory (RDT). We test the proposed model on a sample of 689 Chinese multinational enterprises (CMNEs) between 1999 and 2013. The results show that CMNEs politically tied to the central government internationalize faster than CMNEs without such ties. We also find that CMNEs with ties to local governments and to foreign JV partners internationalize more slowly than CMNEs without such ties. We also show how multiple domestic dependency network ties interact to influence internationalization speed. We discuss the implications of our findings for the Uppsala model and RDT.

We study how the gender of owners and CEOs affects a firm's degree of internationalization. By integrating the gender literature and agency theory, we examine how gender heterogeneity (i.e., male owner and female CEO; male owner and female CEO) may affect CEOs' risk-taking decisions, such as internationalization strategies. The gender literature shows that women are more risk-averse than their male counterparts. Additionally, agency theory suggests that managers tend to pursue less risky strategies than their owners desire. By integrating these literatures, we examine whether gender interactions between owners and managers influence internationalization strategies. Using an international firm-level dataset, we find that gender homogeneity is negatively related to internationalization and that the combination of a male CEO and female ownership leads to the greatest degree of internationalization.

This study compares the effectiveness of proactive and reactive impression management (IM) in anticipation of negative news announcement. Drawing on expectancy violations theory, we argue that reactive IM is more effective than proactive IM and can give rise to more favorable analyst recommendations because proactive (reactive) IM can trigger negative (positive) expectancy violations among financial analysts–an overlooked target audience of IM. We also posit that the effectiveness of reactive IM relative to proactive IM hinges on whether firms have announced similar negative events in the past and whether such events are prevalent among industry peers. Using a sample of financial restatements from 2001 to 2015, we find empirical evidence for our arguments.

Existing impression management (IM) literature has emphasized the role of positive news as a strategic noise tactic when a firm has concerns about negative expectancy violations. In this study, we argue that a firm may use negative news as strategic noise to help justify a strategic decision, because the use of negative news can help obscure the causal link between a decision announcement and a resulting negative market reaction. Using a sample of 8,409 merger and acquisition (M&A) deals from 2000 to 2015, we found that when intending to make an M&A announcement, firms preemptively release more positive and negative strategic noise than predicted by chance. The amount of preemptive negative strategic noise is positively associated with the amount of preemptive positive strategic noise before or on the day of the M&A announcement. We also found that firms tend to release positive and negative strategic noise as reactive IM strategies after the M&A announcement. However, they release positive and negative strategic noise in different ways, depending on the actual market reaction to the announcement.

Scholars have investigated how shareholder activism by institutional investors- organizations that manage money on behalf of clients-directly shapes the actions of firms that are targeted for activism. We shift attention to an indirect process we call "portfolio spillover"-the extent to which activist behavior targeted toward a firm in an investor's portfolio of holdings influences actions by other firms that are not presently targeted for activism. We examine portfolio spillover by extending the awareness-motivation-capability framework from its traditional domain of competitive dynamics to the governance arena. We theorize that firms will be more likely to respond to investors targeting other portfolio members to the extent that those firms become aware of the implicit threat of activism. We also develop and test theory about how the capability of activists to launch a successful campaign and the motivation of firms to react can moderate this relationship. Using data from a sample of S&P 1500 companies from 2000-2013, we find that firms restructure and reduce growth in response to portfolio spillover. These relationships are stronger when activist investors have capability to attack and firms have motivation to respond.

Our study reveals the financial performance implications of the speed at which Chinese multinational enterprises (CMNEs) expand into intra-regional versus inter-regional host countries. In doing so, we propose a framework that integrates internationalization speed and home regionalization literatures. Using data from 767 publicly listed CMNEs from the years 2002 to 2014, we discover that the faster the intra-regional internationalization, the better the firm’s financial performance, whereas faster inter-regional internationalization demonstrates a poorer financial performance. We also find that fast-mover CMNEs’ technological and marketing resources are valuable in intra-regional host countries, but vulnerable in inter-regional host countries. We discuss the implications of these findings for studies of the Uppsala internationalization process model and regional MNEs.

This study proposes that CEO-CFO "language style matching"-a form of unconscious verbal mimicry based on function words-can provide insights into social interaction processes between CEOs and CFOs. We argue and empirically verify that high CEO-CFO language style matching reflects CFOs' strong attempts to ingratiate themselves with CEOs. Because ingratiation with superiors can lead to the superiors' positive evaluations of subordinates, CFOs who exhibit higher language style matching with CEOs will receive higher compensation and are more likely to become board members of the associated firms. In addition, the proposed relationships will be stronger when CEOs are more powerful. Yet, in the presence of high CEO-CFO language style matching, CFOs are less likely to voice different viewpoints and challenge CEOs in strategic decision processes. As a result, firms tend to undertake more mergers and acquisitions, and such mergers and acquisitions will be paid with a low percentage of cash (vs. stock) and realize lower announcement returns. Using a sample of over 2,000 U.S. firms from the period 2002-2013, we find empirical support for these predictions.

We theorize how family and non-family CEOs in family multinational enterprises (FMNEs) divest foreign subsidiaries. In doing so, we propose an integrative framework that supplements the socioemotional wealth perspective by introducing the notion of socioemotional favoritism. Using this framework, we hypothesize and find that family CEOs are less likely to divest than non-family CEOs by analyzing 161 Korean manufacturing FMNEs between 1998 and 2003. We also find that family CEOs avoid divesting foreign subsidiaries with larger affective endowments, particularly those under family control through threshold ownership and those located in host countries where families have already lost ownership of subsidiaries through past divestitures. We conclude by discussing the implications of our findings for the family firm literature.