Abstract
This paper examines how the aggregated actions of rivals belonging to the same organizational field affect a firm’s exits from existing market segments. We argue that while a firm’s exit decisions are strongly influenced by the aggregated actions by other firms which may serve as an uncertainty-reducing signal, the focal firm’s strategic responses to signals from the organizational field of rivals are more complicated, informed, and rational, than is usually suggested. For instance, in its evaluation of signals about segment attractiveness based on the aggregated actions of rivals, the focal firm will give different weights to rivals’ actions according to the strength of competitive threat, will make refined inferences about the attractiveness of a segment based on the performances of rivals, and will give a greater weight to recent actions by rivals than to older ones. The results of our event history analysis of all segment exits by Korean SI ventures support all our hypotheses.
| Original language | English |
|---|---|
| Pages (from-to) | 398-421 |
| Number of pages | 24 |
| Journal | Australian Journal of Management |
| Volume | 41 |
| Issue number | 2 |
| DOIs | |
| Publication status | Published - 2015 Jan 1 |
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All Science Journal Classification (ASJC) codes
- Business, Management and Accounting(all)
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Intended rationality in exit decisions : The organizational field of rivals as a source of signal in segment exit decisions by Korean SI ventures, 2000–2006. / Shin, Dong Youb; Kim, Sunhyuk; Jung, Kiwon.
In: Australian Journal of Management, Vol. 41, No. 2, 01.01.2015, p. 398-421.Research output: Contribution to journal › Article
TY - JOUR
T1 - Intended rationality in exit decisions
T2 - The organizational field of rivals as a source of signal in segment exit decisions by Korean SI ventures, 2000–2006
AU - Shin, Dong Youb
AU - Kim, Sunhyuk
AU - Jung, Kiwon
PY - 2015/1/1
Y1 - 2015/1/1
N2 - This paper examines how the aggregated actions of rivals belonging to the same organizational field affect a firm’s exits from existing market segments. We argue that while a firm’s exit decisions are strongly influenced by the aggregated actions by other firms which may serve as an uncertainty-reducing signal, the focal firm’s strategic responses to signals from the organizational field of rivals are more complicated, informed, and rational, than is usually suggested. For instance, in its evaluation of signals about segment attractiveness based on the aggregated actions of rivals, the focal firm will give different weights to rivals’ actions according to the strength of competitive threat, will make refined inferences about the attractiveness of a segment based on the performances of rivals, and will give a greater weight to recent actions by rivals than to older ones. The results of our event history analysis of all segment exits by Korean SI ventures support all our hypotheses.
AB - This paper examines how the aggregated actions of rivals belonging to the same organizational field affect a firm’s exits from existing market segments. We argue that while a firm’s exit decisions are strongly influenced by the aggregated actions by other firms which may serve as an uncertainty-reducing signal, the focal firm’s strategic responses to signals from the organizational field of rivals are more complicated, informed, and rational, than is usually suggested. For instance, in its evaluation of signals about segment attractiveness based on the aggregated actions of rivals, the focal firm will give different weights to rivals’ actions according to the strength of competitive threat, will make refined inferences about the attractiveness of a segment based on the performances of rivals, and will give a greater weight to recent actions by rivals than to older ones. The results of our event history analysis of all segment exits by Korean SI ventures support all our hypotheses.
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UR - http://www.scopus.com/inward/citedby.url?scp=84964916833&partnerID=8YFLogxK
U2 - 10.1177/0312896215578477
DO - 10.1177/0312896215578477
M3 - Article
VL - 41
SP - 398
EP - 421
JO - Australian Journal of Management
JF - Australian Journal of Management
SN - 0312-8962
IS - 2
ER -