21. May 2019: Research Lecture by Prof. Uriel Stettner

"What drives Exploration? Convergence and Divergence of Exploration Tendencies among Alliance Partners and Competitors"
Stettner

 

Date: Tuesday, 21 May 2019, 16.00-17.30
Room: SR 17 (SoWi, 4th floor)

Management research has alluded to organizational and environmental conditions that drive firms' tendencies to explore versus exploit. We complement this research by demonstrating how a firm adjusts its own exploration level based on the levels of its alliance partners and competitors. Using panel data on 180 electronics firms publicly traded in the U.S., we reveal an inverted U-shaped association between the firm's exploration tendency and the exploration levels of its partners and competitors. Convergence is explained by imitation and legitimation, while divergence is associated with risk perception and specialization in the knowledge domain. We further show how the convergence of the exploration tendency becomes stronger under firm-specific uncertainty but weaker when the exploration patterns exhibited by the firm's partners and competitors are incoherent. Finally, counter to expectations, we show that this convergence is weakened by the technological proximity of the firm's competitors. Our findings inform research on the antecedents of exploration by underscoring the role of interdependence in firms' exploration tendencies.

Uriel Stettner is Associate Professor of Strategy, Innovation, and Entrepreneurship at Tel Aviv University, Coller School of Management.


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