Symbolic Shareholder Democracy: Toward a Behavioral Understanding of the Role of Shareholder Voting in CEO Dismissals

2023 | Organization Science | Citations: 0

Authors: Andrei, Alina G.; van Oosterhout, J. (Hans); Sauerwald, Steve

Abstract: We investigate the effect of expressive shareholder dissent voting, in which sha ... Expand

Abstract: We investigate the effect of expressive shareholder dissent voting, in which shareholders use their votes symbolically to express their discontent with management, on subsequent chief executive officer (CEO) dismissals. Using the routine but highly symbolic executive board discharge proposal voted on at the annual shareholder meetings of German firms, we argue that the board of directors understands these votes as a “vote of confidence in management” that challenges the CEO’s mandate to lead the firm. Arguing that board chairs are uniquely positioned to take up the stance of a steward of the firm and its leadership, we examine how independent and family board chairs moderate the board’s response to expressive voting dissent. Using a sample of German public firms over the period 2008–2015, we find that expressive voting dissent increases the chance of CEO dismissal increasingly with the level of dissent expressed. Contrary to prevailing agency theoretical expectations, we do not find that independent chairs are more responsive to expressive voting dissent, nor that this relationship is strengthened by the degree of minority institutional investor ownership of the firm. Consistent with the symbolic perspective on shareholder voting that we seek to develop, however, we find that family chairs are more likely to lead the board to dismiss the CEO due to the intrinsic disvalue they incur from symbolic leadership legitimacy challenges in their firms, and that the positive effect of having a family chair on the dissent induced chance of CEO dismissal is strengthened by the level of family ownership in the firm. Funding: A University of Illinois at Chicago Summer Research Grant is gratefully acknowledged for S. Sauerwald. Collapse

Topics: corporate governance financial performance accounting organizational productivity

Methods: theory development statistical hypothesis test post-hoc analysis longitudinal research survival analysis

Theories: stewardship theory behavioral theory

Human vs. Automated Sales Agents: How and Why Customer Responses Shift Across Sales Stages

2023 | Information Systems Research | Citations: 0

Authors: Adam, Martin; Roethke, Konstantin; Benlian, Alexander

Abstract: Customers in sales processes increasingly encounter automated sales agents (ASAs ... Expand

Abstract: Customers in sales processes increasingly encounter automated sales agents (ASAs) that complement or replace human sales agents (HSAs). Yet, little is known about whether, how, and why customers respond to ASAs in contrast to HSAs across successive decision stages of the same sales process. Even less is known about customer responses to HSA-ASA combinations, where both agents assume distinct roles and focus on complementary tasks that are traditionally performed by only one single sales agent. Against this backdrop, this paper explores the influence of increasingly common sales representative (rep) types (i.e., ASA, HSA, and HSA-ASA) on customer decisions across sales stages. Drawing on information processing theory and the literature on hedonic-utilitarian decision making, we investigate customer responses to text-based ASAs from vendor companies in two common early stages of email sales processes (i.e., sales initiation stages) when customers successively decide whether to indicate their initial interest in an offer and then, whether to provide their contact information. Specifically, we conducted two complementary multi-decision experiments, namely (1) a randomized field experiment in a high-stakes sales initiation setting (n = 325) and (2) a subsequent randomized online experiment to complement the real-world insights (n = 408). Our core findings reveal reversing effect patterns of sales rep types across stages: although customers are more likely to indicate their initial interest to HSAs (versus ASAs) because of HSAs’ higher levels of social presence, they are less likely to provide contact information to HSAs because of HSAs’ lower levels of performance expectancy and effort expectancy. We also show that HSA-ASA combinations can be reasonable options for single ASAs, yet contextual features of the sales setting may affect differential customer responses to HSA-ASA combinations (versus ASAs) in each sales stage. Taken together, we uncover shifting effect patterns in customer responses to sales rep types across successive sales stages and shed light on the consecutive underlying mechanisms that explain these shifts. These findings have significant implications for vendor companies seeking to allocate HSAs and/or ASAs effectively across various decision stages in sales processes and beyond. History: Wonseok Oh, Senior Editor and Khim Yong Goh; Associate Editor. Funding: This work was supported by the Center for Responsible Digitality (ZEVEDI) and the German Research Foundation (DFG) [Grant 471168026]. Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2022.1171. Collapse

Topics: electronic mail social presence decision making recommender system information system use

Methods: experiment randomized field experiment regression analysis method experimental task field experiment

Theories: information processing theory

Whistleblowing and Group Affiliation: The Role of Group Cohesion and the Locus of the Wrongdoer in Reporting Decisions

2023 | Organization Science | Citations: 0

Authors: Bergemann, Patrick; Aven, Brandy

Abstract: Conventional accounts describe whistleblowing as prosocial behavior, where whist ... Expand

Abstract: Conventional accounts describe whistleblowing as prosocial behavior, where whistleblowers are largely driven by a desire to help or improve their organization. Yet individuals are not only members of their organization; they also belong to internal social groups that affect behavior and influence decision making. In this paper, we focus on these intraorganizational dynamics and theorize two ways in which group affiliations are likely to affect whistleblowing. When an individual observes wrongdoing committed by a person affiliated with the same group, higher group cohesion decreases the likelihood of blowing the whistle because of potential whistleblowers’ greater loyalties toward group members and a desire to protect the reputation of the group. When an individual observes wrongdoing committed by a person not affiliated with the same group, higher group cohesion increases the likelihood of blowing the whistle, as potential whistleblowers feel they have the support of fellow group members, lessening fears of retaliation. Using unique data on actual and hypothetical whistleblowing among U.S. federal employees in 24 departments and agencies coupled with a vignette experiment, we find support for our arguments. By showing how group affiliations inform whistleblowing decisions, we reveal how variation in social structure leads to heterogeneity in responses to wrongdoing. Together, these results reveal tradeoffs in the detection of misconduct and help explain why wrongdoing in organizations may be so difficult to eradicate. Collapse

Topics: anonymity missing data electronic mail

Methods: survey experiment hierarchical linear modeling mixed method theory development

Microfoundations of Adaptive Search in Complex Tasks: The Role of Cognitive Abilities and Styles

2023 | Organization Science | Citations: 1

Authors: Bergenholtz, Carsten; Vuculescu, Oana; Amidi, Ali

Abstract: Problem-solving in complex environments requires a cognitively demanding search ... Expand

Abstract: Problem-solving in complex environments requires a cognitively demanding search for task solutions. Managing this search process presents a major challenge in organizations. We contribute to the literature on this topic by providing new evidence on the cognitive antecedents that shape how individuals search when engaged in complex problem-solving tasks. We present results from three laboratory studies, wherein 335 individuals solved a complex task. In doing so, they generated behavioral data coupled with survey-based measurements of the individuals’ cognitive styles and performance-based tests of their cognitive abilities. Our data analysis contributes to the current literature by documenting systematic heterogeneity in the persistence and distance of search that can be explained by the participants’ level of creativity, attention to detail, and executive functions. We extend the research on the microfoundations of adaptive search by linking cognitive antecedents with a complex search task, widening our insight into what search behavior certain cognitive microfoundations lead to, and showing how managers can more effectively shape organizational search.History: This paper has been accepted for the Organization Science Special Issue on Experiments in Organizational Theory.Supplemental Material: The online appendix is available at https://doi.org/10.1287/orsc.2023.1654. Collapse

Topics: decision making logistics management problem solving anonymity competitive advantage

Methods: laboratory experiment survey qualitative interview experimental task generalized linear model

Theories: ambidexterity theory

Network Centralization and Collective Adaptability to a Shifting Environment

2023 | Organization Science | Citations: 1

Authors: Bernstein, Ethan S.; Shore, Jesse C.; Jang, Alice J.

Abstract: We study the connection between communication network structure and an organizat ... Expand

Abstract: We study the connection between communication network structure and an organization’s collective adaptability to a shifting environment. Research has shown that network centralization—the degree to which communication flows disproportionately through one or more members of the organization rather than being more equally distributed—interferes with collective problem-solving by obstructing the integration of existing ideas, information, and solutions in the network. We hypothesize that the mechanisms responsible for that poor integration of ideas, information, and solutions would nevertheless prove beneficial for problems requiring adaptation to a shifting environment. We conducted a 1,620-subject randomized online laboratory experiment, testing the effect of seven network structures on problem-solving success. To simulate a shifting environment, we designed a murder mystery task and manipulated when each piece of information could be found: early information encouraged an inferior consensus, requiring a collective shift of solution after more information emerged. We find that when the communication network within an organization is more centralized, it achieves the benefits of connectivity (spread of novel better solutions) without the costs (getting stuck on an existing inferior solution). We also find, however, that these benefits of centralization only materialize in networks with two-way flow of information and not when information only flows from the center of the network outward (as can occur in hierarchical structures or digitally mediated communication). We draw on these findings to reconceptualize theory on the impact of centralization—and how it affects conformity pressure (lock-in) and awareness of diverse ideas (learning)—on collective problem-solving that demands adaptation.History: This paper has been accepted for the Organization Science Special Issue on Experiments in Organizational Theory.Funding: The authors acknowledge financial support from the Division of Research at the Harvard Business School for making this research possible. Collapse

Topics: social influence problem solving internet technology social network debugging

Methods: experiment machine learning simulation Poisson regression logistic regression

Theories: organizational theory

“Dear CEO and Board”: How Activist Investors’ Confidence in Tone Influences Campaign Success

2023 | Organization Science | Citations: 0

Authors: Brauer, Matthias; Wiersema, Margarethe; Binder, Philipp

Abstract: Activist hedge funds represent the most potent form of financial activism. Yet w ... Expand

Abstract: Activist hedge funds represent the most potent form of financial activism. Yet we do not fully understand how these activist investors, despite holding only a small stake in target firms, are able to influence management and the board to acquiesce to their demands, especially given the large uncertainty that their demands will improve shareholder value. Building on impression management (IM) theory, we propose that activist investors who express their concerns and demands with high confidence in their letters to target firms are likely to be perceived as knowledgeable and competent by the firm’s other shareholders, thus influencing the response of the firm’s management and board. In support of this theoretical proposition, results of our empirical analysis of 475 U.S. activist campaigns against U.S. companies between 2007 and 2019 suggest that confidence in tone in an activist’s letter, as a form of self-promotion, is positively associated with campaign success. We also observe that the positive association between confidence in tone in activist letters and campaign success is less for activists with greater success in prior campaigns and in campaigns with multiple activists. Our paper contributes to financial activism research by showing that activists’ verbal impression management can serve as an effective influence tactic in their campaigns. Our study also contributes to the emerging research stream on verbal IM by introducing a language attribute, confidence in tone, that has not been studied in management research and is distinct from past constructs examined in verbal IM research. Collapse

Topics: corporate governance strategic management organizational productivity decision making database system

Methods: descriptive statistic qualitative content analysis theory development linguistic analysis regression analysis method

Theories: behavioral theory

Breaking bad habits: A field experiment about how routinized work practices can be made more eco-efficient through IS for sensemaking

2023 | Information & Management | Citations: 0

Authors: Degirmenci, Kenan; Recker, Jan

Abstract: We conducted a field experiment to compare the effects of information systems (I ... Expand

Abstract: We conducted a field experiment to compare the effects of information systems (IS) supporting reflective disclosure and information democratization on the sustainability footprint of a routine organizational work practice, paper printing. We find that both sensemaking processes lead to employees reducing their printing; however, the processes are interchangeable and do not mutually reinforce each other’s effects. This finding contrasts a latent assumption of prior research about a co-dependence between reflective disclosure and infor­ mation democratization, and suggests organizations have a choice in how they can design and use IS to help employees make sense of different possibilities for more eco-efficient work. Collapse

Topics: sensemaking electronic mail environmental sustainability system support systems design

Methods: experiment survey field experiment design artifact generalized linear model

Theories: theory of organizational sensemaking

A novel label-based multimodal topic model for social media analysis

2023 | Decision Support Systems | Citations: 0

Authors: Li, Hao; Qian, Yang; Jiang, Yuanchun; Liu, Yezheng; Zhou, Fan

Abstract: Extracting useful knowledge from multimodal data is the core of many multimedia ... Expand

Abstract: Extracting useful knowledge from multimodal data is the core of many multimedia applications, such as recommendation systems, and cross-modal retrieval. In this paper, we propose a label-based multimodal topic (LB-MMT) model to jointly model text and image data tagged with multiple labels. Specifically, we use the labels as supervised information to generate the text and image data. In the LB-MMT model, we assume that the textual words and visual words related to each text and image are drawn from a mixture of latent topics, where each topic is represented as a group of textual words and visual words. Moreover, we introduce multiple topics for each label, to build the top-down relationship from label to text and image. To investigate the effectiveness of the proposed approach, we conduct extensive experiments on a real-world multimodal dataset with labels. The re­ sults show the proposed approach obtains superior performances on topic coherence and label prediction compared with previous competitors. In addition, we show that our model yields interesting insights about multimodal topics. The proposed model provides important practical implications, e.g., designing more attrac­ tive multimodal contents for marketers. Collapse

Topics: Java social media Linux electronic commerce search engine

Methods: topic model word embedding Gibbs sampling BERT computational algorithm

Theories: technology acceptance model

Handling Missing Values in Information Systems Research: A Review of Methods and Assumptions

2023 | Information Systems Research | Citations: 0

Authors: Peng, Jiaxu; Hahn, Jungpil; Huang, Ke-Wei

Abstract: In today’s big data environment, missing values continue to be a problem that ha ... Expand

Abstract: In today’s big data environment, missing values continue to be a problem that harms data quality. The bias caused by missing values raises the highest concern, as it cannot be eliminated simply by increasing the sample size. Although the statistics literature has developed approaches to handling missing values and formulated assumptions regarding when these approaches generate valid statistical inferences, these prescriptions have yet to be broadly accepted by many social science disciplines, including the information systems (IS) discipline. By reviewing recently published empirical research in information systems, we find that missing values are indeed an important and pervasive problem. We believe that a review of missing value theory is necessary and timely for the IS community to understand the nature of missing values and to promote more rigorous research practice when missing values are often unavoidable. In addition, the missing not at random (MNAR) mechanism brings about challenges in parameter estimation. We contribute to research practice by proposing and demonstrating the superior performance of a Monte Carlo likelihood approach in correcting bias in parameter estimation. We conclude by suggesting that research validity can be enhanced through a reasoned adoption of the missing value handling method and structured missing value reporting practices.History: Giri Kumar Tayi, Senior Editor; Pei-Yu Chen, Associate Editor.Funding: This work was supported by the Singapore Ministry of Education [Grants R-253-000-136-114, R-253-000-149-490, and R-253-000-158-114] the National Natural Science Foundation of China [Approval No. 72201288], and the Program for Innovation Research in Central University of Finance and Economics. Any opinions, findings, and conclusions or recommendations expressed in this material are those of the authors and do not reflect the views of the Singapore Ministry of Education, the Singapore Government or the Central University of Finance and Economics.Supplemental Material: The online appendices are available at https://doi.org/10.1287/isre.2022.1104. Collapse

Topics: missing data research and development electronic commerce logistics management mindfulness

Methods: simulation regression analysis method robustness check literature sample data imputation

Algorithmic Fairness in AI

2023 | Business & Information Systems Engineering | Citations: 0

Authors: Pfeiffer, Jella; Gutschow, Julia; Haas, Christian; Möslein, Florian; Maspfuhl, Oliver; Borgers, Frederik; Alpsancar, Suzana

Abstract: ... Expand

Abstract: Collapse

Topics: artificial intelligence decision making IT security digital service price management

Methods: machine learning generalized linear model