Vicarious Learning And Inferential Accuracy in Adoption Processes

Terlaak, Ann; Gong, Yan

doi:10.5465/amr.2008.34421979

Cited by 135 publications

(116 citation statements)

References 92 publications

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“…For example, Greve (1995) and Rao et al (2001) view decision makers as deciding to discontinue a practice based partly on information inferred from others discontinuing, yet they do not consider that information can also be inferred from decision makers initiating (or choosing to continue) the practice. Recent conceptual work (Terlaak and Gong 2008) and empirical studies have begun to rectify this; Greve (2011), Xia et al (2008), and Connelly et al (2011 all show that in the context of adoption, firms attend not only to adopters but also to abandoners and rejecters. Our study further supports this-we find that in the context of firm exit decisions, firms infer information from both exits and entries.…”

Section: Implications For Herding Modelsmentioning

confidence: 99%

“…The reason is that the cognitive task of attending to these firms would be too great: unlike firm exits, each nonexit is a "non-event" that can easily go unnoticed (Denrell 2003). Additional challenges would include delineating the relevant risk sets of nonexiters as well as distinguishing firms that reject exit because they view it as unwarranted from those that simply have not yet contemplated it (Terlaak and Gong 2008). Given these considerations, we theorize that firms infer information not from nonexits but rather from the entry of others into the VC market.…”

Section: Development Of Hypothesesmentioning

confidence: 99%

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Decomposing Uncertainty and Its Effects on Imitation in Firm Exit Decisions

Gaba

Terlaak

2013

Organization Science

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T his study examines the effects of different uncertainty types on interorganizational imitation in firm exit decisions.We draw on herding models to conceptualize exit decisions as being based on a firm's private information, which the firm updates with information inferred from observing the actions of others. We posit that different types of uncertainty differentially affect this observational learning process; in particular, we propose that certain uncertainty types attenuate (rather than foster) observational learning and subsequent imitation. We test this theory using a 29-year panel data set on the exit of private venture capital firms. Our results indicate that observational learning does influence imitation in firm exit decisions, and they also suggest that a common belief-that uncertainty enhances imitation-does not apply to all types of uncertainty. Specifically, we find that uncertainty fosters imitation only when it is idiosyncratic to the firm; uncertainties that are common to all firms, in contrast, actually reduce reliance on observational learning. By decomposing uncertainty into different types and explicating their effects on imitation, we demonstrate that this relationship is more nuanced than previously assumed and, in addition, highlight the role of deliberate information processing in imitation.

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Section: Implications For Herding Modelsmentioning

confidence: 99%

Section: Development Of Hypothesesmentioning

confidence: 99%

Decomposing Uncertainty and Its Effects on Imitation in Firm Exit Decisions

Gaba

Terlaak

2013

Organization Science

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“…This reliance on other parties' knowledge is indicative of vicarious learning (Baum, Li, and Usher, 2000;Kim and Miner, 2007;Terlaak and Gong, 2008).…”

Section: Vicarious Learningmentioning

confidence: 99%

An organizational learning perspective on the contracting process

Lumineau

Fréchet

Puthod

2011

Strategic Organization

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The contracting process is a crucial step in alliance development and its success. However, the existing literature reveals surprisingly little investigation into how organizational learning relates to the process of contract making. We therefore conducted an in-depth longitudinal study of the alliance contracting process in the animated film industry. First, our findings suggest that during the contracting process, firms can learn about the way to deal with the contracting process, about themselves and their partner, and about the transaction features. Second, the case analysis indicates a combination of experiential, vicarious, and inferential learning mechanisms. Combining these insights into the objects and the mechanisms of learning during the contracting process, we discuss how contracting and learning processes are related and analyze the role of the contracting process in supporting organizational learning. The findings show that the drafting of contractual clauses fosters learning and, in turn, this learning triggers new contractual negotiations. Hence we suggest that the alignment between transaction features and the choice of contractual governance results from learning during the contracting process. We then propose avenues for future research. KeywordsContracting process; strategic alliances; organizational learning; longitudinal case study 3 Acknowledging that contracts account for a substantial part of future alliance performance, strategy and organization researchers have paid increasing attention to the structure of alliance contracts (e.g. Lumineau and Malhotra, 2011;Reuer and Ariño, 2007; see Weber, Mayer, and Wu, 2009, for a recent review). Scholars have in particular started to explore how learning relates to contracts (Argyres, Bercovitz, and Mayer, 2007; Dekker and Van den Abbeele, 2010;Mayer and Argyres, 2004;Ryall and Sampson, 2009;Vanneste and Puranam, 2010). Prior research has generally analyzed learning effects from one contract to the next. It has been suggested that the structures of contracts change over time as the firms gain experience in working together (Argyres et al., 2007;Mayer and Argyres, 2004). However, as the contract is generally seen as an outcome of the parties foreseeing hazards and the focus is mostly on the contractual structure, we still do not know much about what is learned during the contracting process and how this learning occurs.In addition, the processes preceding alliance formation, and particularly the process of contract In this paper, our aim is to develop a better understanding of the links between the contracting process and learning. Our study elaborates on organizational learning (e.g. Argote and MironSpektor, 2011;Inkpen and Tsang, 2007) in order to analyze learning dimensions in the alliance contracting process. While considering the structure and the content of the contract, our approach focuses on the process that the parties use to draft the contract (Macneil, 1980). We seek to improve our knowledge of alliance contracting by studyi...

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“…For instance, economic models tend draw on informational arguments, pointing to a growing level of general information about the value of a practice in affecting diffusion decisions, whereas sociological models have tended to use more reputational arguments that relate to growing pressures for social conformity. Taken together, these bodies of literature offer a variety of rational, boundedly rational, and social explanations for the adoption and diffusion of practices across time and space (Greve, 1998;Terlaak & Gong, 2008).…”

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confidence: 99%

Made to Fit: How Practices Vary as They Diffuse.

Ansari¹,

Fiss

Zajac

2010

Academy of Management Review

496

654

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We extend research on the diffusion of corporate practices by providing a framework for studying practice variation during diffusion processes. Specifically, we theorize about how population-level mechanisms of diffusion link with organization-level mechanisms of implementation that lead to the adaptation of practices. We also identify technical, cultural, and political elements of fit (or misfit) between diffusing practices and adopters and analyze how the process of attaining fit across these elements can trigger different patterns of adaptation.

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Vicarious Learning And Inferential Accuracy in Adoption Processes

Cited by 135 publications

References 92 publications

Decomposing Uncertainty and Its Effects on Imitation in Firm Exit Decisions

Decomposing Uncertainty and Its Effects on Imitation in Firm Exit Decisions

An organizational learning perspective on the contracting process

Made to Fit: How Practices Vary as They Diffuse.

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