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Organizational design correlates of entrepreneurship : the roles of decentralization and formalization for opportunity discovery and realization
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Foss, Nicolai J., Lyngsie, Jacob and Zahra, Shaker A. (2015) Organizational design correlates of entrepreneurship : the roles of decentralization and formalization for opportunity discovery and realization. Strategic Organization, 13 (1). pp. 32-60. doi:10.1177/1476127014561944 ISSN 1476-1270.
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Official URL: http://dx.doi.org/10.1177/1476127014561944
Abstract
Extant research offers relatively little insight into the organizational design correlates of entrepreneurship in established firms. We argue on theoretical grounds that the same organizational designs support the realization as well as the discovery of opportunities. Specifically, decentralized structures are associated with opportunity realization as well discovery, and this effect is reinforced by formalization. Decentralization gives managers the discretion and autonomy needed to recognize and realize opportunities, while formalization enables the standardization and codification of actions and processes. To test these ideas, we use a data-set based on paired responses from 474 Danish firms operating in several industries for our analyses. We find that decentralization and formalization have direct, positive, and significant associations with opportunity realization. We also address how these organizational design variables are related to opportunity discovery. We find similar effects. We discuss the theoretical and practical implications of our reasoning and results, such as implications for the idea in the innovation and organizational learning literatures that optimal performance over time requires that firms either vacillate between organizational designs or adopt ambidextrous designs.
Item Type: | Journal Article | ||||||
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Divisions: | Faculty of Social Sciences > Warwick Business School > Entrepreneurship, Innovation & Management Faculty of Social Sciences > Warwick Business School |
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Journal or Publication Title: | Strategic Organization | ||||||
Publisher: | Sage Publications Ltd | ||||||
ISSN: | 1476-1270 | ||||||
Official Date: | 1 February 2015 | ||||||
Dates: |
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Volume: | 13 | ||||||
Number: | 1 | ||||||
Page Range: | pp. 32-60 | ||||||
DOI: | 10.1177/1476127014561944 | ||||||
Status: | Peer Reviewed | ||||||
Publication Status: | Published | ||||||
Access rights to Published version: | Restricted or Subscription Access |
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