2008
DOI: 10.5465/amr.2008.31193499
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Misery Loves Company: The Spread of Negative Impacts Resulting from an Organizational Crisis

Abstract: We describe how negative impacts emanating from an organizational crisis that initially strikes only one organization can overflow the boundaries of that organization and affect others in the industry. We argue that this spillover process is contingent on the characteristics of the organizational form to which the stricken organization belongs, the characteristics of other organizations in the same industry, and the characteristics of the industry itself. Finally, we speculate that the spillover process, coupl… Show more

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Cited by 203 publications
(178 citation statements)
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References 111 publications
(161 reference statements)
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“…The nuclear industry has also been associated with unprecedented environmental and social destruction (Janofsky, 2005) as a result of military nuclear testing, radiation spills from accidental reactor failures and the disposal of nuclear waste (Clemens & Papadakis, 2008). Moreover, stigmatized firms' externalities may occasionally spark industry crises, transgressing the organizational boundaries of the entities involved and aggravating negative public perceptions of the industry as a whole (Durand & Vergne, 2014;Yu, Sengul, & Lester, 2008). Thus, "sin" firms permanently live with what has been termed a "negative headline risk" and remain constantly under the social microscope of value judgments (Fabozzi, Ma, & Oliphant, 2008, p. 86).…”
Section: Prior Literature and Hypotheses Developmentmentioning
confidence: 98%
“…The nuclear industry has also been associated with unprecedented environmental and social destruction (Janofsky, 2005) as a result of military nuclear testing, radiation spills from accidental reactor failures and the disposal of nuclear waste (Clemens & Papadakis, 2008). Moreover, stigmatized firms' externalities may occasionally spark industry crises, transgressing the organizational boundaries of the entities involved and aggravating negative public perceptions of the industry as a whole (Durand & Vergne, 2014;Yu, Sengul, & Lester, 2008). Thus, "sin" firms permanently live with what has been termed a "negative headline risk" and remain constantly under the social microscope of value judgments (Fabozzi, Ma, & Oliphant, 2008, p. 86).…”
Section: Prior Literature and Hypotheses Developmentmentioning
confidence: 98%
“…Culture clash potential is defined as the extent to which organizational cultures are expected to be different, as assessed and predicted by external institutional intermediaries, such as the popular press and financial analysts (Stahl & Voigt, 2008;Yu, Sengul, & Lester, 2008). This conceptualization of culture clash potential can take into account the idiosyncratic nature of each deal, while avoiding the complexity of the concept of culture in M&As (Teerikangas & Very, 2006).…”
Section: Culture Clash Potentialmentioning
confidence: 99%
“…Corporations regularly face a myriad of potential crises, which are low-probability and high-risk events (Yu et al, 2008). Crisis is not a matter of “if” but “when” in corporate life.…”
Section: Introductionmentioning
confidence: 99%