Setting the beat of deals: acquisition and divestiture rhythms and their effect on innovation performance
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2024-08-26
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en
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Corporations in the high-technology industry are increasingly stimulated to enhance their innovation performance. Even though acquisitions and divestitures can be useful in realizing this objective, the ability to derive value from acquisitions and divestitures is challenging and complex. Drawing on organizational learning theory and the temporal perspective, the aim of this study is to investigate whether multi-business corporations can realize enhanced innovation performance by adopting specific acquisition and divestiture rhythms. This study argues that corporations can enhance their innovation performance by combining regular acquisition and divestiture rhythms with aspects of irregular rhythms – and thus adopting even-event paced rhythms. This study also argues that prior experience allows corporations to manage the negative aspects of irregular rhythms and leverage the positive aspects associated with regular rhythms. The findings indicate that an even-paced divestiture rhythm generally results in increased patent application quantity. This relationship is however contingent upon prior divestiture experience. Corporations possessing low amounts of divestiture experience apply for more patents when adopting an even-event paced divestiture rhythm, whereas experienced divestors can increase their subsequent patent application quantity by adopting an even-paced divestiture rhythm. For acquisition rhythms the findings indicate that its relation with the subsequent number of claims per patent is contingent upon prior acquisition experience. Experienced acquirors generally produce more claims per patent than less experienced acquirors regardless of the adopted rhythm. Furthermore, experienced acquirors adopting an even-paced acquisition rhythm generate more claims per patent, whereas less experienced acquirors produce more claims per patent by adopting an event-paced acquisition rhythm. These findings contribute to the literature on rhythms and the temporal perspective, organizational learning theory, acquisitions, divestitures, innovation, and prior experience.
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Faculteit der Managementwetenschappen