AIB 2012 Conference Proceedings - Academy of International ...

TUESDAY
The Changing Nature of Global Integration: Antecedents of Parent and Affiliate Product Transfers
Heather K Berry, George Washington University
Aseem Kaul, University of Minnesota
In this paper, we study the factors that drive the direction of resource transfers within MNCs. We argue that
different benefits from global integration will drive different configurations of intra-firm transfers. More
specifically, aggregation benefits from exploiting organizational endowments on a global scale will be associated
with transfers from parents, while arbitrage benefits from accessing location-specific advantages will drive
multilateral transfers from affiliates. Results from a unique panel of 33 US manufacturing industries between
1989 and 2004 show support for these arguments, highlighting a significant increase in intra-firm product
transfers from affiliates, driven by foreign knowledge-seeking activities and the threat of foreign rivals. This
paper thus extends our theoretical understanding of global integration, while providing empirical insights into
the changing nature of global product transfers. (For more information, please contact: Heather K Berry,
George Washington University, USA: berryh@gwu.edu)
Firms as Catalyst of Within Country Migration Evidence from a Randomized Intra-Firm Experiment in India
Prithwiraj Choudhury, University of Pennsylvania
Tarun Khanna, Harvard Business School
In the face of rapid growth, technology firms in countries like India face severe labor shortages. Such firms also
face physical and informational barriers in hiring talented individuals from remote locations and from
disadvantaged social groups. However, investing in hiring such individuals might lead to higher payoff in
equilibrium. Our empirical setting is "INDTECH," one of India's largest information technology (IT) firms where
we exploit the pre-existence of a randomization of entering talent across the available projects in the 10
development centers INDTECH runs across India. This randomization helps us evade econometric problems that
plague studies that measure employee productivity within firms. We use hand collected data on personal
records and migration patterns for entry level employees recruited by INDTECH in 2007 from over 250
educational institutions all across India. We find that employees from remote locations outperform talent
sourced from mainstream locations provided the distance of migration is less than 500 miles. Further, the nonmainstream
talent appears disproportionately to use the firm as a platform for further advanced education.
Also, talent from underrepresented social strata outperforms that hired from mainstream social communities.
(For more information, please contact: Prithwiraj Choudhury, University of Pennsylvania, USA:
prithw@wharton.upenn.edu)
The Role of Absorptive Capacity Routines and Attention Directing Mechanisms in Adoption of a Management
Innovation
Carine Peeters, Université libre de Bruxelles
Silvia Massini, University of Manchester
Arie Y. Lewin, Duke University
This paper studies how the organization level of directing attention (C-level or local) mediates the absorptive
capacity (AC) of an organization in the adoption and implementation of a management innovation. Drawing on
two in-depth case studies, it provides empirical evidence of organizational routines underlying AC capabilities
and shows that two different configurations of AC practiced routines in different organizations can lead to
successful implementation of the same management innovation, namely the reconfiguration of firms' value
chains through sourcing of business services from low cost countries. However, the organizational level for
directing attention and guiding adoption of the innovation affects the time to successfully implement the
management innovation. Specifically, the cases suggest that the C-level ‘attention-directing' mechanism as it
relates to legitimating and facilitating implementation of the new practice is more time efficient than
problemistic search or local directing attention mechanisms. Moreover, the application of certain AC routines
are more important in the early stages of articulating, developing and implementing the management
AIB 2012 Conference Proceedings
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