Organizational Slack Research Articles

Organizational Slack, Corporate Social Responsibility, Sustainability, and Integrated Reporting: Evidence from Korea

This paper examines whether organizational slack is associated with firms’ voluntary disclosure of corporate social responsibility (CSR), sustainability, and integrated reporting. This is an empirical research study using archival data based on a sample of public firms listed on the Korea Exchange from 2005 to 2016. We manually collected CSR reports, sustainability reports, and integrated reports (IRs) that were published during our sample period. We found that human resource slack was highly related to the publication of corporate social responsibility, sustainability, and integrated reports. Firms initiating such disclosure in their industry groups were likely to have slack in permanent employees as well as financial slack. Additionally, integrated reporting, which is a recent improvement in the delivery of financial and non-financial information, was positively associated with an excess number of regular employees. This study provides evidence that slacks in regular employees are related to a greater degree of voluntary disclosure via standalone CSR or sustainability reporting as well as integrated reporting. These findings suggest that slacks or excess human resources play a crucial role in voluntary corporate disclosure.

Do government subsidies promote firm-level innovation? Evidence from the Korean renewable energy technology industry

This study investigates how government policies affect firm-level innovation. To empirically test this relationship, we use panel data for the Korean renewable energy technology firms. Taking into account the results of various panel framework tests and sample size, we establish a panel vector autoregressive model in the first difference, and use a bias-corrected least squares dummy variable estimator to test complex dynamic relationships between public subsidies, firm heterogeneities (size, age, and slack), industry dynamic competition, and innovation. Based on the estimations, we find that there is a positive bidirectional causal relationship between firms’ innovation and each of the following: research and development (R&D) subsidy, available organizational slack, and industry dynamic competition. Non-R&D subsidy, firm size, and age do not have significant direct effects on firm-level innovation. However, non-R&D subsidy is involved in the relationship between R&D subsidy and firms’ innovation. We discuss some implications based on the findings of this study.

With a little help from my friends: the positive contribution of teamwork to safety behaviour in public hospitals

ABSTRACTAgainst the backdrop of decreased organizational slack in public sector organizations, we investigate the direct and indirect effect of teams on safety behaviour in an Italian acute care hospital. Quantitative and qualitative findings confirm the positive contribution of teams to individuals’ safety behaviour. The study contributes to the limited empirical research on safety behaviour in high-reliability settings as part of a wider conversation about public sector professionals under crisis. The findings can assist managers of public sector hospitals to facilitate conditions for effective team communication in the interest of patient safety, and can, conceivably, be extended to other public sector high-reliability settings.

Predictors of Nurses' Research Use in Canadian Long-term Care Homes

ObjectivesWe examined the influence of individual characteristics and organizational context features on nurses' self-reported use of research evidence in long-term care (LTC) homes. DesignA cross-sectional analysis of survey data collected in the Translating Research in Elder Care program. Setting and participants756 nurses (registered nurses and licensed practical nurses) from 89 LTC homes in Western Canada. MethodsGeneralized estimating equation modeling was used to identify which individual characteristics and organizational context features significantly predicted (P < .05) 3 kinds of self-reported research use by nurses: instrumental (the direct application of research findings), conceptual (using research findings to change thinking), and persuasive (using research findings to convince others). ResultsNurses reported a moderate to high level of research use. There were no significant differences in mean research use scores by nursing role. Only 2 variables were associated with all 3 kinds of research use: having a positive attitude toward research, and availability of structural and electronic resources. Additional variables associated with instrumental research use were problem-solving ability, engaging in formal interactions (eg, education sessions), and better perceptions of organizational slack–staff (the availability of sufficient staff). Additional variables associated with conceptual research use were self-determination and job efficacy. Finally, additional variables associated with persuasive research use were belief suspension (the ability to suspend previously held beliefs), organizational citizenship behavior (one's voluntary commitment to the organization), self-determination, job efficacy, evaluation, and better perceptions of organizational slack–time (perceived availability of extra time). Conclusions and implicationsConceptual and persuasive research use were most strongly influenced by individual characteristics, whereas instrumental research use was predicted equally by individual and organizational variables. Nurses working in LTC are positioned in leadership roles; by targeting both the individual- and organizational-level predictors of nurses' research use, they can improve conditions for individuals living in LTC.

A Multisite Health System Survey to Assess Organizational Context to Support Evidence-Based Practice.

Implementation and sustainability of a culture of evidence-based practice (EBP) require a systematic approach. A baseline assessment of the organizational context can inform implementation efforts. To examine organizational hospital context and provider characteristics associated with EBP readiness and to describe EBP context across hospitals. A nonexperimental descriptive correlational design was used to conduct a web-based survey of direct-care registered nurses (N=701) and nurse managers (N=94) across a large Midwestern multisite healthcare system using the Alberta Context Tool (ACT). Many significant relationships existed among nurse characteristics and ACT domains, including age (lower age had higher Leadership, Evaluation, and Formal Interactions), education (graduate education had lower Social Capital than a bachelor's or associate degree), role (direct-care nurses had lower Culture than managers and lower Social Capital), and work status (full-time employees had lower Evaluation and Social Capital). EBP context across type of hospitals is similar, with marginal differences in Social Capital and Organizational Slack (higher in critical access hospitals). Assessing organizational context to support EBP is the first step in developing and enhancing a sustainable culture of inquiry. The ACT has been tested across countries, settings, and healthcare disciplines to measure perception of readiness of the practice environment toward EBP. Optimal organizational context is essential to support EBP and sustain the use of evidence in professional nursing practice. Nursing leaders can use baseline assessment information to identify strengths and opportunities to enhance EBP implementation. Enhancing organizational context across nurse characteristics (e.g., age, role, and work status) to acknowledge nurses' contributions, balance nurses' personal and work life, enhance connectedness, and support work culture is beneficial. Fostering development of Social Capital in nurses is needed to influence EBP readiness. A systematic and standardized approach to foster EBP across health systems is key to successful implementation.

The Relationship between Corporate Environmental Responsibility and Firm Performance: A Moderated Mediation Model of Strategic Similarity and Organization Slack

There has been growing interest among business managers and academics in corporate environmental responsibility (CER), which represents a company’s focus on its long-term sustainability and society. Past research, however, has reported inconsistent and mixed results with regard to the link between CER and firm performance. This study, therefore, proposes and validates a moderated mediation model of strategic similarity and organizational slack to better explain the relationship between CER and firm performance. Data were obtained from 260 listed firms in China from 2015 to 2017, resulting in 780 firm-year observations. Multivariate data analysis indicates that strategic similarity mediates the relationship between CER and firm performance. Furthermore, organizational slack moderates the relationship between CER and strategic similarity and the indirect effect of CER on firm performance through strategic similarity. The findings of this study provide insights for business managers attempting to understand and enhance the quality of their decision making regarding CER. Importantly, business managers should engage in CER activity and pursue strategic similarity to deal with pressure from stakeholders while following the competitive speed of competitors in the marketplace.

A system dynamics approach to the efficiency thoroughness tradeoff

In human factors and safety, the principle of Efficiency-Thoroughness-Tradeoff (ETTO book of Hollnagel, 2009) has stimulated a new perspective on how safety events may arise when organizations increase pressures at work to produce more, faster but with less resources. Several studies have provided evidence of the ETTO principle in healthcare, manufacturing, maintenance, maritime, aviation and air traffic control. This paper seeks to look deeper into the mechanisms and dynamics of ETTO by using a system dynamics approach of similar exploitation-exploration tradeoffs as applied in the context of management science. The model has looked into the dynamics of two variants of thoroughness, that is, compensation tactics and explorative strategies. Simulation trials with a system dynamics model have identified ‘tipping points’ where production challenges cannot be met by continuing to do more by exploiting existing resources. Results also indicate that exploration can become a source of organizational slack that can be traded in to increase capabilities and hence, productivity up to a certain point. ETTO situations have also been examined in conditions of environmental dynamism (e.g., information uncertainty, fluctuations of demands and borderline conditions) that affect the effectiveness of operations and long-term capabilities. Finally, the system dynamics model has looked into ways that exploration could be enhanced by means of articulation and learning. By using a simulation model, this article shows how quantitative modeling can provide additional insights into the ETTO principle.

Towards Re-engineering of the Ship of the Indian State: An Agenda for Dialogue and Research

The soft Indian State has become flabby as well—a labyrinth of sorts—as a result of piece-meal additions of institutions and structures over the years, resulting in sub-optimal functioning. Below potential outcomes abound at the micro-level. The macro-picture is not so dismal but even there, the well-founded systemic ‘checks and balances’ of a democracy frequently take a dysfunctional form—of (unintended) logjams. The (legitimate) liberal pre-occupation with (due) process is unable to accord commensurate attention to performance (outcomes). The problem is aggravated, of course, by the absence of judicious exercise of responsibility by key players in the national polity. This Note abstracts from that, and other, human failing(s) or those of governance. It seeks to address the conundrum on the structural plane—questing for possibilities of overcoming the ‘decelerating’ impact of the many ‘speed-breakers’ that have come into play over time through an argument for a revisiting of the ‘structuration and apparatuses’ of the State focused on ‘functionality’. A review of the record of the Republic, in other words, aimed at perking up the plural polity in a strategic, ‘systems’ perspective, and shoring up the politico-managerial component of the ‘comprehensive national power’ of the Indian State. To make it more purposive and efficacious by cutting down on ‘organizational slack’. A ‘strategic dialogue’ between three key constituencies of the polity is proposed. For enabling sharper delineation of the strategic political interests of the State and better management of the polity. And for fleshing out an agenda for structural reform accordingly. There is a time crunch operational which this arm-chair exercise has to be mindful of. Three major tipping points kick into play within a few decades from now—reversal of the (currently) favourable demography of the country, possibility/likelihood of calamitous climate change and (as yet unpredictable but likely wrenching) impact (on socio-political stability) of the disruption being wrought by digital and other advanced technologies of the Fourth Industrial Revolution globally, AI above all. Attention to ‘State-building’—state-craft—as a facet of nation-building, in other words. Conscious of the need to hasten execution of the enlightened, egalitarian founding agenda of the Republic before its centenary mid-century. And with a mindful eye on the People’s Republic of China, the only real peer of the Indian State in the comity of nations.

Why firms go green and how green impacts financial and innovation performance differently: An awareness-motivation-capability perspective

Based on the awareness-motivation-capability framework, this research examines how firm-level factors (environmental scanning and organizational slack) individually and collectively interact with institutional factors (government support and industry competition) to influence a firm’s adoption of green management. Moreover, we distinguish the impacts of green management on financial performance and innovation performance. The empirical findings reveal that environmental scanning and organizational slack facilitate green management, government support strengthens these positive relationships, and industry competition attenuates the effect of environmental scanning on green management. In addition, green management enhances innovation performance to a greater extent than financial performance. This research provides an integrative framework illustrating how firm-level factors and institutional environments influence green decisions and proposes that green management may impact firm performance measures in distinctive ways.

A behavioral theory of alliance portfolio reconfiguration: Evidence from pharmaceutical biotechnology

AbstractResearch SummaryExtant research suggests that firms rationally evaluate external and/or internal contingencies when deciding how to reconfigure their alliance portfolios. We advance a behavioral perspective which assumes that managers are boundedly rational and thus rely on behavioral heuristics when making alliance portfolio reconfiguration decisions. In panel data on U.S.‐listed biotechnology firms, we find that below‐aspiration performance motivates a firm to form alliances with novel partners within the resource scope of its existing alliance portfolio. This effect is weakened by equity ties with existing partners and strengthened by firm‐specific uncertainty. Conversely, above‐aspiration performance leads to new alliances with existing partners but outside the resource scope of the firm's existing alliance portfolio. Finally, as organizational slack increases, a firm forms alliances with novel partners focusing on new‐to‐the‐portfolio resources.Managerial SummaryWe study why and how firms change the configuration of their alliance portfolios over time. We find that actual performance relative to performance objectives, and firms' excess resources, are important drivers of such change. The more firms fail to meet their performance objectives, the more likely they are to form alliances with novel partners focusing on areas in which they already have one or more alliances with other partners. The more firms exceed their performance objectives, the greater their inclination to form alliances with their existing partners in areas in which they do not yet have alliances. The greater the stock of excess resources, the greater firms' propensities to form alliances with novel partners focusing on areas in which they do not yet have alliances.

THE IMPACT OF ORGANISATIONAL SLACK ON INNOVATIVE WORK BEHAVIOUR: HOW DO TOP MANAGERS AND EMPLOYEES DIFFER?

In this paper, we advance our understanding of the relationship between slack and innovation in two ways. We distinguish between different slack types on the organisational level, and hypothesise and empirically test how they influence innovative work behaviour (IWB) of both employees and top managers on the individual level. Applying a multigroup analysis in PLS-SEM, we test our model with a sample of 403 individuals, 155 top managers and 248 employees, from the German real estate industry. We find support for our central argument that the influence of organisational slack on individuals’ IWB differs according to the type of slack and the organisational role of the individual.

Exploring the Effects of Government Policies on Economic Performance: Evidence Using Panel Data for Korean Renewable Energy Technology Firms

Previous studies have investigated how government policies on renewable energy technology (RET) affect economic performance at the industrial level. However, each firm in the RET industry is heterogeneous in terms of their capacities, resources, and the amount of public subsidies they receive. Considering the context in which public subsidies are provided to firms, this study econometrically investigates the effects of government policies on firms’ financial performance using panel data from the Korean RET industry. We consider the results of various panel framework tests; establish a panel vector autoregressive model in first differences; and test the dynamic relationships between firms’ financial performance, government subsidies (R&amp;D- and non-R&amp;D-related), firm size and age, and organizational slack, using a bias-corrected least squares dummy variable estimator. We find that R&amp;D- and non-R&amp;D-related subsidies positively affect firms’ financial performance in the long run. In the short run, there are bidirectional positive causal relationships between firms’ financial performance and organizational slack (and non-R&amp;D-related subsidy), and firm size and non-R&amp;D-related subsidy. A positive short-run relationship runs from R&amp;D-related subsidy to firms’ financial performance, from firm age to non-R&amp;D-related subsidy, and from firm size to firm age. Further, there are dynamic effects in all estimations, demonstrating that the dependent variables of the previous period enhance their values in the current period. The results provide some policy and strategic implications.

Contextual factors to registered nurse research utilisation in an Australian adult metropolitan tertiary intensive care unit: A descriptive study

BackgroundOrganisational and unit-level context can have a significant impact on implementation of evidence in practice, the latter being particularly important in the complex intensive care context. Evaluating the context may allow modifiable characteristics to be identified and addressed. ObjectivesThe objective was to examine the relationship between dimensions of the context and research utilisation in one intensive care unit. MethodsThis study used a quantitative cross-sectional survey. All registered nurses working in one Australian quaternary referral hospital intensive care unit were surveyed using the Alberta Context Tool and research utilisation instrument. Descriptive statistics were used, and bivariate analysis was undertaken to determine associations among demographic data, dimensions of context, and research utilisation. ResultsThe survey response rate was 33% (67/205). Most respondents were women with a mean of 8 years of intensive care nursing experience. The dimensions of culture, evaluation, informal interactions, structural/electronic resources, and organisational slack (time and space) were positively correlated with research utilisation. ConclusionsResearch utilisation was associated with numerous context dimensions, emphasising their effect on knowledge translation in this setting. Intensive care nurses are in a unique position to impact care delivery and provide evidence-based care to ensure optimal outcomes to patients at high risk of morbidity and mortality. Identified dimensions may be targeted and developed in future strategies to optimise the context for translating evidence into this complex practice environment.

A contingency view of the effects of sustainable shipping exploitation and exploration on business performance

Anchored to the resource-based view, this study identifies the types of sustainable shipping capabilities that can be pursued and developed by shipping companies to enhance their business performance. The paper also examines internal and external contextual factors that moderate the relationship between the identified shipping capabilities and business performance. Survey data were collected from 225 shipping companies with business offices in Singapore and analysed using structural equation modelling and a multiple-sample approach. The results show that both sustainable shipping exploitation and exploration capabilities have positive effects on business performance. Organisational slack and environmental uncertainty negatively moderate the relationship between sustainable exploitation capability and business performance but positively moderate the relationship between sustainable exploration capability and business performance. The results imply that sustainable shipping should be viewed as a dynamic capability rather than a set of practices, which connote stasis. In addition, management policies to develop sustainable exploitation or exploration capabilities should depend on the internal and external environment of shipping companies. This paper introduces an alternative theoretical lens through which to manage and improve the allocation of organisational resources to enhance corporate sustainability and business performance of shipping companies.

Ambidextrous culture, contextual ambidexterity and new product innovations: The role of organizational slack and environmental factors

AbstractContextual ambidexterity, defined as the simultaneous pursuit of alignment and adaptability at business unit, is linked to several organizational outcomes including improved performance and innovation outcomes. Extant research posits ambidextrous organizational culture as an important enabler to contextual ambidexterity but suffers from a lack of a well‐meaning scale for the same. In addition, there is very little understanding as to how tasking and facilitating environment can be on firms' endeavour for contextual ambidexterity and the outcomes thereof. Therefore, the current piece of research has twin objectives using two separate studies. First, to develop a scale for ambidextrous organizational culture construct and second, to analyse the role played by the external forces (munificence and dynamism) and internal slack resources on the relationships between ambidextrous organizational culture and contextual ambidexterity and between contextual ambidexterity and new product innovation outcomes through an empirical investigation in India. Using structural equation modelling on data from 414 respondents, we found environmental munificence to strengthen the relationships between ambidextrous organizational culture and contextual ambidexterity and between contextual ambidexterity and new product innovation outcomes. On the other hand, environmental dynamism had a dampening impact on these relationships. Our findings also suggest that for low slack organizations, dynamic and unmunificent environments magnified the negative impact on an organisation's ambidexterity efforts and new product innovation outcomes.

Strategic choices of exploration and exploitation alliances under market uncertainty

PurposeThe purpose of this paper is to provide a better understanding of what drives firms’ choice between exploration alliances and exploitation alliances by examining the role of organizational slack and its interaction with market uncertainty.Design/methodology/approachAn empirical study is conducted based on 1,614 alliances formed by 581 US biotechnology firms, and the hypotheses are tested using a zero-inflated multilevel Poisson model.FindingsThe results indicate that firms’ strategic choice to pursue exploration or exploitation alliances is a reflection of organizational intention and adaptation to environmental turbulence. More specifically, firms with more financial slack tend to form more exploration alliances and fewer exploitation alliances. However, under high market uncertainty, firms with financial slack tend to establish more exploitative partnerships and avoid exploration collaborations.Originality/valueThis paper contributes to the literature on exploration–exploitation alliances, which tends to fall short of providing an understanding of why organizations pursue such alliances. By identifying the impact of organizational slack and its interaction with market uncertainty, this study shows that organizations are able to respond to environmental change, and those with capabilities are likely to craft their strategic choice configurations based on their own characteristics.

Variable contingencies, leadership styles and organizational slack predominant in a Santa Catarina textile industry

Variable contingencies, leadership styles and organizational slack predominant in a Santa Catarina textile industry

Do Firm’s Organisational Slacks Influence the Relationship between Corporate Lobbying and Corporate Financial Performance? More Is Not Always Better

A political involvement in any organisation has often proved to be profitable for such firms that are seeking support and favourable regulatory conditions. Though many studies have investigated the effect of the corporate lobbying activities on the organisations, no clear results have been achieved. In this study, we have investigated the lobbying expenditure of some of the most famous United States (US)-based companies, which support the U.S. government during 2007–2016. Primarily, we tested the relationship between the corporate lobbying and the Corporate Financial Performance (CFP), with the help of a dynamic panel data analysis, which is based on the System Generalised Methods of the Moment (SYS-GMM). The results of this study indicated that the corporate lobbying did not increase the probability of gaining more support from the government in comparison to the firms that did not use any lobbying techniques. Furthermore, the findings showed that corporate lobbying is a component of the zero-sum political agenda that cannot be accurately evaluated and does not contribute towards the improvement of the CFP. This study introduced the important component of organisational slack and noted that the corporate lobbying could significantly destroy the CFP if the organisational slack was high.

Why do some SMEs explore more while others exploit further? Evidence from Chinese SMEs

PurposeWhy do some small and medium-sized enterprises (SMEs) explore more while others exploit further? What are the driving forces of their exploratory and exploitative innovation? These are intriguing questions worthy of in-depth research. The purpose of this paper is to crack these problems from both objective (i.e. organizational slack) and subjective (i.e. market orientation) perspectives. Specifically, the paper examines the effects of unabsorbed and absorbed slack on exploratory and exploitative innovation and the mediating roles played by proactive and responsive market orientation.Design/methodology/approachThe authors collected data from 214 SMEs in several industries of China. These businesses were located in the city of Shanghai and the provinces of Jiangsu and Zhejiang in the southeastern part of China. The survey method was used to test the hypotheses.FindingsResults reveal that unabsorbed and absorbed slack could affect exploratory and exploitative innovation. Proactive and responsive market orientation are related to unabsorbed and absorbed slack, exploratory and exploitative innovation, and they play the roles of mediators in two sets of the relationships.Research limitations/implicationsThis research presents several profound insights for venture capitalists regarding to making investment decisions and for the entrepreneurs of SMEs in terms of how much resource slack they should gain and retain to reach intended level of exploratory and exploitative innovation. Some of the limitations of this study relate to the single respondent in each firm, lack of examination on relevant contextual factors and potential moderators.Originality/valueThis study addresses the gaps in the literature by exploring the mechanisms underlying the effects of different kinds of organizational slack on the two elements of ambidextrous innovation in non-large-scale businesses in a non-Western cultural setting.

The race is on: Configurations of absorptive capacity, interdependence and slack resources for interorganizational learning in coopetition alliances

Coopetition alliances offer great learning opportunities as well as tensions related to the sharing and protection of knowledge. Interfirm learning advances the complementarities in coopetition while sourcing efficiency advantages and innovation. Sharing and protection tensions in coopetition require firm- and relationship-oriented factors to enable interfirm learning. The present study reveals configurations of strong and weak interfirm learning in coopetition alliances. Absorptive learning capacity is a necessary condition of interfirm learning, while organizational slack resources and interdependence between firms are important additional conditions.