Michael H. Lubatkin

• PhD
• Professor Emeritus at University of Connecticut

There is currently a debate in the literature regarding whether family firm ownership fosters or discourages risk-taking activities. In this article, we propose a contingency framework that shifts the focus of investigation: instead of asking whether family firms tend to be risk takers, we suggest specific ownership conditions under which privately...

The literature has suggested that an entrepreneurially alert information system may be a salient driver of corporate entrepreneurship, even though this role has been neither theoretically articulated nor empirically substantiated. Building upon the organizational learning, information orientation, and entrepreneurial awareness literatures we identi...

Although theory suggests that CEOs who engage in transformational leadership should have a positive effect on firm performance, most empirical examinations using data drawn from larger firms have failed to find support for this linkage. Given that the organizational complexity associated with larger firms has been viewed as a central obstacle to es...

Research about transformational CEOs' impact on firm-level outcomes, particularly corporate entrepreneurship, has been equivocal, partially because the underlying mechanisms remain largely unexplored. Given that the individuals most closely influenced by a firm's CEO are its top management team (TMT) members, we focus on the CEO-TMT interface as a...

Based on the work of Berle and Means (1932), Coase (1937), Arrow (1971), and others, agency theory emerged in the 1970s to explain economic relationships under conditions of uncertainty and less-than-perfect information. It has become a widely used theoretical lens in strategic management research, with applications intended to inform research abou...

By integrating insights from two seemingly disparate literatures economics and organizational justice within the general agency framework, we advance propositions that suggest a fine-grained explanation of agency costs at family firms. In so doing, we account for the differential effects of the controlling owners' self-control (i.e. the governance...

This study seeks to further delineate how a firm's competitive environment influences the firm's pursuit of entrepreneurial activities. To do so, we develop and test a parsimonious model that establishes the role of discretionary slack as a salient mediating mechanism through which managerial environmental perceptions influence corporate entreprene...

While a firm’s ability to jointly pursue both an exploitative and exploratory orientation has been posited as having positive performance effects, little is currently known about the antecedents and consequences of such ambidexterity in small-to medium-sized firms (SMEs). To that end, this study focuses on the pivotal role of top management team (T...

We draw on industrial-organization economics theory, density-dependent and resource-partitioning theories, and brand-leveraging theories to propose a product-level theory of market entry. The result is a more fully informed account of the relationship between the firm and its ability to shape its market environment. Our core thesis is that the rela...

Drawing on three prominent views about the “self” and the self's relationship with “others”, a typology of five parental altruistic archetypes is derived that exhausts the possible altruistic influences on the governance of family firms. When taken in concert, these five types comprise a more balanced explanation of the cross-sectional variance in...

This study examines one specific aspect of the resource-based view, intellectual capital, and its three knowledge components - human, organizational, and social capital. We hypothesize that the impact of each component on financial performance is contingent upon the values of the other components, and that these leveraging effects are themselves co...

Given the ubiquity of Internet access in the business world, the question for strategy researchers is no longer over whether or not Internet surveys are viable, but rather over the comparative advantages and disadvantages of this modality. To address this question, we provide guidelines for researchers to help minimize the challenges while still re...

Shane and Venkataraman's Discovery, Evaluation and Exploitation entrepreneurship framework ignores issues central to comparative international entrepreneurship (IE) because of unnecessarily under-socialized assumptions regarding entrepreneurial opportunities and the individuals who discover them. To better promote comparative IE research, we develo...

We reason that agency theory's behavioral assumptions may too closely reflect the US institutional context to explain the governance heritages that exist elsewhere. We propose that what constitutes opportunistic behavior and what can be done to limit it may vary due to differences in national background and formal institutions. We then test the val...

Although agency theory dominates corporate governance research, its behavioral assumptions stand in direct competition to the worldviews held by most organizational scholars. In this article, the author argues that it is high time for organizational scholars to stop deferring to economists and start to develop their own governance theories, for whi...

The research regarding the characteristics of family firm governance are mixed, with some studies suggesting the presence of benefits of concentrated ownership and others suggesting increased conflict among family employees.To better understand the functioning of family businesses, both the positive and negative aspects of family firm governance mu...

Extending Hambrick's (1994) concept of behavioral integration, a meta-construct of top management team process, we theorized on the extent to which CEO-, team-, and firm-level determinants shape behavioral integration. Using survey data from 402 firms, we developed a reliable measure of the construct and found strong support for our structural mode...

We argue that the challenges faced by threshold firms are deeply rooted in governance characteristics (i.e. the incentives, authority and legitimacy) which imbue them with characteristic capabilities, disabilities and path dependencies. Whereas Zahra and Filatotchev (2004) reason the principal problem facing threshold firms relates to organizationa...

Surprisingly, the majority of U.S. family firms offer employed family members short- and long-term performance-based incentive pay. We draw on the household economics and altruism literatures to explain why family firms might feel compelled to do so and develop theory that predicts when this practice will be beneficial. Results based on data obtain...

Roland Calori received his Ph.D. from the University of Aix en Provence in 1983 and joined EM Lyon later that same year, where he soon became department head. Later, as the director of research he helped transform that school into one of France’s top schools of commerce. Roland co-authored 5 books and was involved in the writing of over 50 journal...

We develop a theory of the effects of inter-organizational networks on both radical and incremental forms of firm-level entrepreneurial behavior (EB). The central argument is that structural embeddedness, with its focus on the network as a whole, and its two consequences, relational and cognitive embeddedness, individually and collectively influenc...

The authors used social capital theory to explain how human and social capital affect a venture's ability to accumulate financial capital during its growth stages and its performance during the two-year period after going public.

Using an agency-theoretic lens and insights drawn from the behavioral economics and family business literatures, we developed hypotheses concerning the effect of dispersion of ownership on the use of debt by private family-owned and family-managed firms. A field study of 1,464 family firms was conducted. Results suggest that, during periods of mark...

In valuing any investment project or acquisition, executives must decide what discount rate to use to estimate the value of the projected cash flows. This paper argues that the traditional approach, which bases its estimate of the company’s cost of capital on the Capital Asset Pricing Model, places the company at risk. Specifically, ‘beta’ is unrel...

Roland Calori received his Ph.D. from the University of Aix en Provence in 1983 and joined EM Lyon later that same year, where he soon became department head. Later, as the director of research he helped transform that school into one of France’s top schools of commerce. Roland co-authored 5 books and was involved in the writing of over 50 journal...

In valuing any investment project or corporate acquisition, executives must decide what discount rate to use in their estimates of future cash flows. The traditional approach is to apply the capital asset pricing model (CAPM), which has remained fundamentally unchanged for 40 years. But the formula--in particular, its beta element--has long been a...

The core belief among agency theorists is that when a firm is both owned and managed by family members, its governance structure is efficient. We argue that this belief over-simplifies the complexity of exchanges that occur among the family firm's decision agents, and does not conform to reality. We develop an alternative agency view of family firm...

Although opportunity recognition (OR) is a pivotal concept in entrepreneurship, extant research on it is fragmented and a parsimonious predictive model has yet to emerge. Toward that end, this paper develops and then tests a model of firm level OR behavior. Informed by literatures on entrepreneurship, strategic management, the Austrian school of ec...

Various explanations have been suggested concerning the causes of ‘cultural clashes’ and prescriptions for harmoniously integrating the beliefs and values of merging firms. Using a form of meta-analysis known as a case survey design, which combines the ideographic richness of case studies with the statistical generalizability of larger samples, and...

This article reviews the processes involved in interfirm learning and identifies an alternative form of alliance in which the objective is knowledge creation, not knowledge acquisition or transfer. Grounded on theories from sociology (relational governance) and educational psychology (jigsaw), the article develops an evolutionary model in which suc...

Using an ecological lens, we extend strategic management and industrial organization theory to investigate the performance effects of horizontal mergers. We theorize that firms differ in their ability to benefit from horizontal mergers; that the products involved in the merger differ in their ability to attain and sustain any increase in performanc...

Does owner management necessarily eliminate the agency costs of ownership? Drawing on agency literature and on the economic theory of the household, we argue that private ownership and owner management expose privately held, owner-managed firms to agency threats ignored by Jensen's and Meckling's (1976) agency model. Private ownership and owner man...

The family firm is a misunderstood phenomenon, as it lacks a distinct theoretical identity, despite it being the most common form of business organization in the world. The prevailing belief is that its unique governance structure, being both owned and managed by family members, provides it with a particularly efficient means of achieving "good age...

The primary objective of this paper is to demonstrate the usefulness of an artificial intelligence technique known as neural network analysis as an aid to uncovering the underlying patterns, or trace effects, of national culture. To make our case, we provide an application of the technique's pattern recognition capability utilizing survey data from...

Though the concept of `culture clash' has been widely discussed and written about in the context of mergers and acquisitions, the literature has been relatively silent about how to empirically measure this phenomenon. Given the difficulties associated with developing and testing such a measure - especially gaining access to sufficient numbers of fi...

Though the concept of 'culture clash' has been widely discussed and written about in the context of mergers and acquisitions, the literature has been relatively silent about how to empirically measure this phenomenon. Given the difficulties associated with developing and testing such a measure - especially gaining access to sufficient numbers of fi...

Little theoretical attention has been given to divestiture; that is, to the question of why two firms that face similar environments make different selling decisions and reap different performance outcomes from a sale. This article proposes a framework of divestiture built around the core concept of seller responsiveness, which is defined as the re...

In their response to our paper, Amihud and Lev (1999) and Denis, Denis, and Sarin (1999) claim that disciplinary differences don’t matter and that methods and evidence should speak for themselves. In contrast, we argue that important differences exist between financial economics and strategic management, leading to differing beliefs, norms, methods...

In their response to our paper, Amihud and Lev (1999) and Denis, Denis, and Sarin (1999) claim that disciplinary differences don't matter and that methods and evidence should speak far themselves, in contrast, we argue that important differences exist between financial economics and strategic management, leading to differing beliefs, norms, methods...

Little theoretical attention has been given to divestiture; that is, to the question of why two firms that face similar environments make different selling decisions and reap different performance outcomes from a sale. This article proposes a framework of divestiture built around the core concept of seller responsiveness, which is defined as the re...

The application of Western management techniques to countries in the very early stages of economic development remains a subject of debate. Building on the works of Montgomery in the Southern African Development Coordination Conference countries and of Vengroff in the Central African Republic, the authors examine the skill requirements among Senega...

We propose a framework of risk premium that offers a resolution to CAPM's challenge to the field of strategy. Our core assumption is that investors bear firm-specific risk because they are not as diversified and markets not as perfect as CAPM assumes. We therefore hypothesize that investors require lower risk premiums from firms that are able to re...

To date, the most promising attempt to explain departure rates of executives of acquired firms examined the conditions that create perceptions of relative standing, but did not gauge the perceptions themselves. This study extends this line of research by surveying the post-merger perceptions of the top managers of firms acquired in friendly, relate...

Top managers of British and French firms, which were recently acquired by either British or French firms, were surveyed as to their perceptions of the administrative approach-reflected in integrating mechanisms-used by the acquiring firms to establish headquarters-subsidiary control. Four types of integrative mechanisms were examined: structural, s...

Prior studies of women in management have been conducted primarily from a Western, industrialized, and Anglo-American perspective. Therefore, their findings may not apply to other sociopolitical domains, such as those in transition to market-based economies. This study surveyed Hungarian managers at two different organizational ranks and employed i...

Amihud and Lev (1981) are widely cited as providing evidence that managers, unless closely monitored by large block shareholders, will attempt to reduce their employment risk through unrelated mergers and diversification. These corporate strategies, however, may not be in shareholders' interests. Reconsidering the agency assumptions underlying Amih...

Amihud and Lev (1981) are widely cited as providing evidence that managers, unless closely monitored by large black shareholders, will attempt to reduce their employment risk through unrelated mergers and diversification. These corporate strategies, however, may not be in shareholders' interests. Reconsidering the agency assumptions underlying Amih...

Much of the prior research on interorganizational learning has focused on the role of absorptive capacity, a firm's ability to value, assimilate, and utilize new external knowledge. However, this definition of the construct suggests that a firm has an equal capacity to learn from all other organizations. We reconceptualize the firm-level construct...

Much of the prior research on interorganizational learning has focused on the role of absorptive capacity, a firm's ability to value, assimilate, and utilize new external knowledge. However, this definition of the construct suggests that a firm has an equal capacity to learn from all other organizations. We reconceptualize the Jinn-level construct...

We examine the question of adaptive firm conduct using longitudinal product-level data from three large horizontal mergers in the food manufacturing industry. Our model is grounded in a “poststructural” view of competition that we deduce from recent writings from the fields of strategy, organizational ecology, and industrial organization. Con...

Focusing on middle managers from France and Germany, Michael Lubatkin and Steven Floyd's central question in this article is — does there exist a common European approach to management that facilitates knowledge transfer and other collaborative work efforts?The authors find that there are differences, along at least three dimensions, in perceptions...

Various determinants have been proposed to explain the persistence of nationally-bound administrative heritages. In this paper, we propose an overall model that integrates these contingent determinants. Our model is based on historical analysis, a method of theory building that first conceptualizes a model and then utilizes it as an exploratory len...

Is the nature of managerial work universal such that worldwide similarities exist between the activities of managers? We measure the frequency that managers are involved with forty-four skill activities, and then test the universalist hypothesis against two competing hypotheses, situational and convergence. While we find some evidence that refutes...

This study draws on the concepts of relative standing to explain the post-merger performance of recently acquired European firms. We used a 2 × 3 sampling design where we surveyed top managers of British and French firms that were acquired by British, French, and U.S. firms as to their perceptions of cultural compatibility with the buying firms, th...

Most of what we know about the merger strategy-shareholder value relationship comes from studies based on the 1948–1979 FTC Large Merger Series. However, the market for acquisitions changed dramatically in the 1980s, as government policies facilitated “mergers for efficiency,” rather than “merger for diversity.” We update the list of large mergers...

Most of what we know about the merger strategy-shareholder value relationship comes from studies based on the 1948-1979 FTC Large Merger Series. However, the market for acquisitions changed dramatically in the 1980s as government policies facilitated “mergers for efficiency, ” rather than “merger for diversity. ” We update the list of large mergers...

This study draws on the concepts of relative standing to explain the post-merger performance of recently acquired European firms. We used a 2 × 3 sampling design where we surveyed top managers of British and French firms that were acquired by British, French, and U.S. firms as to their perceptions of cultural compatibility with the buying firms, th...

Mergers are back! The 1990s are witnessing a wave of mergers that rivals the size of those of the 1980s and 1960s. Proponents whisper that these mergers are fundamentally different from the earlier waves, that managers have learned their lessons, and that the underlying logic has fundamentally changed. But are they really that different? Do the mer...

Mergers and acquisitions are part and parcel of the globalization of industries. Yet firms have not mastered the integration phenomenon they entail. This article considers post-acquisition integration as a multidimensional phenonmenon that includes resource sharing, centralization, formalization and socialization. Emphasis is placed on 3 types of f...

Analysiert werden Übernahmen ausländischer Unternehmen hinsichtlich der Frage, ob unterschiedliche Geschäftsführungsgewohnheiten (bedingt durch unterschiedliche Kulturen, differierende soziale Umfelder) vorliegen. In die Untersuchung einbezogen wurden 39 Akquisitionen französischer Unternehmen durch britische Unternehmen und 44 Akquisitionen britis...

Major international organizations involved in development assistance have asserted that the development of non-Western countries - those of Africa in particular - is highly dependent upon their assimilation of Western management techniques. The applicability of these techniques, however, remains the subject of debate in the management and public ad...

In contrast to prior investigations using between-subjects designs to infer the existence of rigidity in decision behaviors, this research used a within-subject design to directly measure rigidity. We also extended previous examinations by distinguishing between semantic and episodic informational cues. Finally, we used a computer process-tracing t...

This paper analyzes the influence of national culture on the integration mechan isms exercised in international acquisitions. The study of 75 international acquisi tions in Europe (France and the United Kingdom) shows that firms are influenced by their national administrative heritage when they acquire companies abroad. For instance, the French exe...

It is widely held that diversification lowers a firm's unsystematic (business-specific) risk but does not affect its systematic (systemwide) risk. We tested each notion while controlling for other factors that influence risk. The findings show that the relationship between corporate diversification and both forms of stock return risk generates a U-...

Merger mania is spreading to Europe. ‘Over the next decade Europe is going to experience the kind of intensification of M&A activity that the US went through in the 1980s.1 The origin of this wave can be attributed to a meeting of economists and politicians in 1980 in Brussels, where the mechanisms were established to deregulate the European busine...

Construct validities are assessed for three simple-to-compute, unweighted, SIC-based continuous diversification measures and a recently proposed two-dimensional, SIC-based categorical diversification measure. Two of the three continuous measures are found to correspond strongly to Rumelt's categorical measures, suggesting that these two objective a...

Although traditional adaptive theory implies that poor organizational performance will directly increase the likelihood that an outsider will be selected to succeed a firm's chief executive, we develop theory to suggest that sociopolitical forces, such as the presence or absence of an heir apparent and the incumbent's ability to influence the selec...

A widely held belief is that diversification lowers a firm's unsystematic risk while not affecting its systematic risk. We tested this notion 28 times, using nineteen years of data and controlling for other factors that influence risk. The findings show that the relationship between corporate diversification and risk is "U- shaped" such that the be...

Merger literature suggests that the relationship between shareholder gains and the relatedness of merging firms is contingent upon the compatibility of the two firms' top management cultures. This hypothesis is tested by surveying the perceptions of cultural differences of top management teams of recently acquired firms, and then relating these per...

This study examines the implications of vertical mergers on the risk characteristic of the merging firms. Specifically, the study focuses on three structural characteristics of the acquiring and acquired firm's market to explain the change in the systematic or environmental risk of the acquiring firm. These structural factors are the level of compe...

This study examines profitability, risk, and replacement context (the disposition of the incumbent CEO) as antecedents of outside succession. Our evidence implies that profit and risk are directly related to the likelihood of selecting an outside successor. Also, when the incumbent CEO is dismissed, the likelihood of selecting an outside successor...

This study examines the stability of the relationship between diversification and shareholder value across contiguous time periods, organized so as to highlight three distinct market cycles. By defining value as a two-dimensional construct, separating the concurrent economic phenomena of cycle and trend, and controlling for other factors that influ...

Strategic management literature suggests a relationship between systematic risk and the relatedness of merging firms. This is tested for a sample of 120 large mergers by controlling for the systematic risk of the target firm, correcting for possible problems of heteroskedasticity, and estimating shifts in risk over daily as well as monthly time hor...

Merging continues to be a popular strategic alternative. Since 1983, over 12,200 companies and corporate divisions, worth about a fifth of the market value of all traded stocks, have changed hands. Along with the wave of mergers are persistent myths, one being that stockholders of acquiring firms rarely benefit from mergers. If mergers do not creat...