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Executive Summary
Most managers know that organizational culture influences the firm's economic
consequences and recognize its important role in shaping product-innovation processes.
Highly innovation-supportive cultures are credited wifh fostering teamwork and
promoting risk-taking and creative actions that seem directly linked to effective new-
product development. Fostering highly innovation-supportive cultures in practice,
however, is easier said than done. From the voices of participants in new-product
development processes in high-technology organizations, we report what we have
learned about the distinctive features of highly innovation-supportive cultures in product-
innovation settings and propose how organizations might develop such cultures.
Managers and scholars have largely accepted the In this article, we provide real-life illustrations
notion that organizational culture is linked with of innovation-supportive cultures as they emerge
positive organizational results.^ There is growing in product-innovation settings and on deriving im-
evidence to suggest that cultures supportive of plications that can speak to the day-to-day reali-
new-product development processes in high-tech- ties of managers. The illustrations emerge from an
nology iirms (henceforth innovafion-supporfive exploratory, qualitative study of new-product
cultures] can foster creative, innovative, and initia- development processes we conducted in ten high-
tive-taking behaviors among participantsi.e., be- technology industrial manufacturing firms.'' In
haviors that are linked to advantageous new-prod- eight of the ten firms we examined, cross-func-
uct results.^ The literature is less clear about why, tional teams with representatives from R&D, pro-
despite the growing awareness of the culture- duction, and marketing groups serve as the prin-
innovation linkage, innovation-supportive cul- cipal structural mechanisms charged with making
tures have failed to proliferate in practice. new-product decisions and organizing the work-
This knowing-doing gap persists in part be- flow. By settings, we refer to the task environment
cause culture is often used as a catchall phrase to created by the web of relationships within and
describe the subjective, amorphous side of organi- between the core participants in these teams
zations that managers implicitly know about and the important contributors to the process, in-
even if many remain mystified about the precise cluding the leadership and senior management,
actions that can create the desired patterns of cul- multiple departments of the firm, and other key
tural beliefs, values, and behavioral norms in constituencies.
practice.^ Currently, for managers operating in the We begin by defining culture and briefly de-
complex, highly interactive settings in which new scribing how it emerges in the product-innovation
products are developed, conceptual and theoreti- settings we studied. Then we discuss how we iden-
cal developments offer little help except the belief tified innovation-supportive cultures in new-prod-
that culture and innovation are linked^something uct settings and briefly highlight their key fea-
which they already seem to know. What can help tures. Then we compare and contrast the artifacts
at this juncture are efforts to present the voices of of cultures we saw as more or less supportive of
managers involved in real-life product-develop- new-product development processes. Based on our
ment processes and concrete illustrations of exist- comparisons, we offer some observations that will
ing conceptual developments and research find- interest managers and scholars concerned with
ings about the culture-innovation linkage. fostering innovation-supportive cultures in the set-
42
2002 Jassawalia and Sashiital 43
tings where multiple technologies, talents, and as- cess. First, we identified product-innovation set-
pirations are integrated into new products ready tings that reported efficient and effective new
for the marketplace. product-development processes, i.e., settings that
had met or improved upon their budgeted time to
market and had met or exceeded their sales and
What We Mean by Culture marketing goals.^ Second, we examined several
Culture in product-innovation settings refers to the elements prevalent in their psycho-social environ-
social and cognitive environment, the shared view ment including values, beliefs, assumptions, and
of reality, and the collective belief and value sys- outcomes to determine the presence of an innova-
tems reflected in a consistent pattern of behaviors tion-supportive culture (see Figure 1). In two set-
among participants.^ While this view of culture tings that reported highly efficient and effective
and its apparent linkage with the behaviors of new-product development processes, we found be-
people is widely held, several key issues germane liefs and values favoring collaboration, creativity,
to managing culture in product-innovation con- and risk-taking deeply ingrained and readily ap-
texts remain unresolved. For instance, some re- parent in the behaviors of participants.^ These set-
gard culture as a separate, measurable dimension tings seemed populated with voting citizens enthu-
of the organization; others view it as inseparable siastic about and capable of articulating the clear
from the firm itself.^ Similarly, while some suggest
that strategies must emerge from a clear under-
standing of what the existing organizational cul-
ture will support, others argue that cultures can
and should be changed to implement new strate- Guiding values, beliefs, and assumptions of par-
gies and achieve new results.^ ticipants in innovation-supportive cultures:
A. Taking initiative and exhibiting creativity
and risk-taking are important and expected.
Some regard culture as a separate, B. All participants are capable of being trusted
measurable dimension of the in a co-creative endeavor and are important,
organization; others view it as equal stakeholders.
C. All participants (including leading custom-
inseparable from the firm itself. ers, key suppliers, and members of other
functional groups) are insiders and should
In the product-innovation settings we examined, be involved early in the product-develop-
culture emerges as an inevitable, collective cre- ment process.
ation of participants acting out their urges to com- D. Organizational change is energizing and
mune with others, make sense of their environ- refreshing. Change should be embraced
ment, define contingencies, and form a social rather than resisted.
order. It emerges from the participants' interac-
Behaviors;
tions with others directed at, among other things,
reducing the anxiety and uncertainty they feel A. Participants voice the clear sense of control
about their involvement in the product-develop- that they feel about their involvement in the
ment process. The decisions and actions of the new-product development process.
leadership and the senior management, and the B. Participants exhibit high levels of co-
topography and physical environment in which creative, collaborative behaviors.
participants find themselves, strongly shape the C. Participants show willingness to make
human interactions. From these interactions themselves vulnerable to feedback from
emerge, among other things, a shared view of re- others.
ality and a shared value system, i.e., an implicitly Related new-product outcomes:
or explicitly agreed-upon set of objectives, states New products from new technologies are de-
of affairs, behaviors, and outcomes that are veloped within time and cost budgets and
deemed more important, worthy, and preferred achieve market success.
than others.
sense of control they felt about their involvement liefs, and values to define their behaviors.'^ In so
in the new-product development process. We la- doing, they provide illustrations in support of
beled the culture of these two settings as "highly ideas about the culture-innovation linkage and of-
innovation-supportive." These cultures contrasted fer a possible explanation for the pervasive and
sharply with those we found in two settings that enduring trends in the creative, risk-taking, and
reported not just significantly slower development innovative behaviors of participants In these prod-
times but also a failure to meet sales expectations. uct-innovation settings. Second, because these ar-
Despite senior management mandates and the tifacts can be managed, i.e., new stories, rituals,
rhetoric of change, these settings promoted think- and physical symbols can be shaped and adopted
ing and behaviors that favored the status quo. Dis- and old ones discarded, what we learned should
satisfaction with poor information exchange, unco- stimulate thinking among those concerned with
ordinated activities, and unequal distribution of shaping and managing culture and influencing
power figured strongly in the responses of partic- the creative behaviors of people in enduring ways.
ipants. We labeled the culture of these settings as
"low innovation-supportive."
Contrasting Highly Innovation-Supportive and
Low Innovation-Supportive Cultures
In two settings that reported highly
efficient and effective new-product Stories
development processes, we found beliefs Narratives of critical incidents and corporate my-
and values favoring collaboration, thologies are important because they hold mean-
creativity, and risk-taking deeply ing both at the literal and metaphorical levels.
They provide important clues about the firm's core
ingrained and readily apparent in beliefs and values which, in turn, set behavioral
the behaviors of participants. expectations for people.''' Stories told and retold
(i.e., new iterations in which meanings often
Third, we identified and examined in depth the change) in highly innovation-supportive cultures
cultural artifacts of these contrasting product-inno- in our study became part of the corporate myth-
vation settings. We did so because the study of arti- ology. They are essentially about change and uni-
facts is central to scholarly writings on organiza- formly highlight the failure of the old and the suc-
tional and other cultures.'" This interest stems from cess of the new. In particular, the stories allude to
the notion that cultural artifacts are observable signs the terrible old days of a functionally divided or-
that can be used to decipher the unseen, complex, ganization and "over-the-wall" workflows in which
and often interactive elements of cultures such as each functional group finished its part of the new-
beliefs, values, and assumptions. In turn, cultural product process and flung their output to the next
artifacts including vocabularies, stories, rituals, and department. Stories highlight near-death experi-
physical symbols are expected to exert powerful in- ences, impending bankruptcies, loss of major cus-
fluences on shaping values, beliefs, and desirable tomers, and dramatic revivals. Two companies we
behaviors among participants. Scholars have taken studied with cultures high on innovation, High-
a variety of approaches to the study of cultural arti- Auto Inc. and High-Jet Inc. (fictitious names),
facts. For instance, some have examined cultural are described in Figure 2. A manager representing
artifacts without any specific interest in their linkage the production function from High-Auto Inc., and
to product-development processes.^' Others have closely involved in new-product development for
specifically addressed the culture-innovation link- 25 years, explains:
age by examining artifacts of cultures associated
with effective innovation.'^ Oh ... the old way . . . we almost went bank-
What we learned from the comparison of cultural rupt here. Back in the middle '80s . .. we had a
artifacts and discuss in the rest of this article can product that we tried to launch . . . that almost
be useful for two reasons. First, artifacts shed light busted us. Because there was no team, it was
on the social environment in which these inno- throwing it [all decision-making and work
vation-supportive values, norms, and behaviors flows] over the wall. It was late, everybody
emerge. They tell us about the cognitive and social had their own agenda, everybody had their
environment in which participants (a) think about own little domain. Everything was frag-
and make sense of the settings in which they find mented and nothing was coming together.
themselves and (b) draw meanings, develop belief And the customer was about ready to say,
and value systems, and use these meanings, be- "Hey, we'll go someplace else."
2002 jassawalla and Sashittal 45
best one was to train the executive manage- Those kinds of education [from workshops]
ment of the organization . . . formally train don't sink in when they're such a small part of
them all in TQM principles and team build- your job. [The dominant department's head]
ing. And those people [senior managers] con- has often mentioned that he wants [his peo-
ducted the training seminars for the rest of ple] to get more involved with what we do and
the organization. And that tells everyone that learn more about what we do ... But to learn
management takes this seriously. You better anything significant in the other field is going
learn this stuff; we're not just going through to cost time, and nobody's got the time for that
the motions. kind of education. [I've h a d ] . . . some very,
very frustrated engineers come to me just
overwhelmed. So [the workshops and meet-
In low innovation-supportive cultures, in contrast, ings are] a nice ideal, and it's one that's
the new-product process is highly ritualistic in talked about and promoted verbally here, but
form but not in substance. Even though people go there isn't any way of doing it. Unless we
through the motions and participate in senior- work two shifts, one for education and one to
management-sponsored rituals, few sustaining get the job done.
improvements in thinking, learning, or doing oc-
cur. For instance, the new-product process in Low-
Mech Inc. is rich with senior management rhetoric, Hence, despite the seemingly common structure of
mandates, and prescriptions for behaviors. Meet- rituals, i.e., meetings, training programs, and for-
ings are inordinately dominated by R&D and are mal sessions for information exchange, they serve
heavy with distrust, paranoia, and lack of confi- contrasting functions in high and low innovation-
dence in others. Participants cheer aloud but whis- supportive cultures. In the former, rituals serve to
per, "That can never happen" under their collective galvanize opinions from open discussions, slaugh-
breaths. The project director's words suggest that ter sacred cows, test previously untested conjec-
meetings are held less for synergistic cross-fertil- tures, and air differences. Rituals allow members
ization of ideas and more for creating opportuni- to span conceptual boundaries, create a team
ties for senior management to monitor progress identity, and define their behaviors in information-
and provide what they see as necessary advice: rich, high-trust environments. In the latter, rituals
tend to emphasize the pecking order and clear
differences that exist in the stature of participants
There might be some times where quality and, worse yet, reinforce existing micro-cultures
[department] doesn't feel like they're being and breed resentment.
heard, or manufacturing doesn't feel like
they're being heard. They [manufacturing]
have been cut short on time to procure parts
for manufacturing and they made an issue of Physical Symbols
it [at the meeting] so that other managers Physical and material symbols include layout and
would also be made aware of it. Typical- design of the work environment, the displayed doc-
l y . . . [it is for] information gathering and also umentation, and other concrete objects that signify
to let our management know where we are, the organization's priorities and desired behaviors
what kinds of problems we're incurring, and of its members.'^ The topography and layout, cou-
maybe also so they can give some direction pled with the artifacts of highly innovation-
and make suggestions on how we might han- supportive cultures, symbolize free choice, equal-
dle certain things. ity, and entrepreneurial energy. For instance,
participants from High-Auto Inc. carry wallet-
sized, laminated mission statements that they
In low innovation-supportive cultures, in developed during the initiating stages of team
contrast, the new-product process is development. The leader explains:
highly ritualistic in form but not in
substance. Each team has a mission statement. We [the
team] came up with our mission statement.
Everybody's got a copy of that. We got it re-
In Low-Electric Inc., the rituals of meetings and duced and laminated so people can carry 'em
workshops are imposed by the dominant func- around in their planners. And I pull these out
tional group and resisted by other participants. in meetings. And it got so that people would
The design engineering department head notes: pull them out. If there was some conflict or
2002 jassawalla and Sashittal 49
something, people would go, "Hey, our mis- the high priority that senior management places
sion statement says this and this and this." on product innovation. The team leader notes:
The mission-statements-in-wallets serve as powerful Another thing we did was we brought a house
symbols of collective ownership, commitment, and trailer in, we put it right in the middle of the
focus. They reflect the sense of involvement and be- factory floor, and it was our launch center.
longingness that participants feel toward new-prod- Launch control. Anything to do with the
uct initiatives. In addition to developing their mis- launch of this product was centered out of
sion statement, the cross-functional team from High- that trailer. We had our daily meetings there,
Auto Inc. has drawn and conspicuously displayed its we had our problem meetings, we had sched-
product-development process chart. Drawn in the uling updates ... everything was done out of
shape of a wheel, it shows the linkages among par- that trailer. And the trailer stayed for four
ticipantssignifying the high level of information months out on the floor. Ii anybody wanted to
exchange that occurs, the nearly flat structure, and communicate with anyone about the project,
the absence of a pecking order. they went to that trailer.
Similarly, the layout of the organization holds
much symbolism in highly innovation-supportive In low innovation-supportive cultures, the topogra-
cultures. Co-location, to the extent that people in phy and layout symbolize division, distrust, and
each department exist in close human contact with the lack of interest in cooperation. For instance, in
people from other departments, is common. In Low-Mech Inc., R&D is housed in a separate build-
High-Jet Inc., the functional department heads ing over a mile away from the one shared by the
share adjacent offices in ways that maximize their marketing and production departments. All meet-
interactions. In Mid-Tech Inc., the leader insists on ings are held in the spanking new R&D facility,
co-locating team members for the duration of the symbolizing their dominance in the new-product
new product project. In High-Auto Inc., the leader process. The conversations that occur during the
organizes off-site retreats to ensure that partici- "meeting after the meeting," i.e., the grousing
pants located in different facilities have the oppor- among manufacturing and marketing representa-
tunity to know each other. The distinctive synergy tives during the drive back to their offices, undoes
we find in highly innovation-supportive cultures most of the dispassionate meeting of minds that
appears to result largely from the conscious reduc- occurs during the formal meeting. The spatial dis-
tion of distance, both spatial and perceptual, tance also contributes to the negative stereotypes
among participants. that each function develops about the other. The
marketing manager from Low-Mech Inc. explains:
The layout of the organization holds Right now we're separated by a mile, which
much symbolism in highly innovation- could be the other end of the earth for all that
supportive cultures. matters. . . . You can't just go into an engi-
neer's office . .. and say, "Look at this prob-
lem." So the only time that we really go over
The two-way radios used by the new product to see them is when we have a leal problem.
team from High-Auto Inc. to ensure real-time con- The only time engineering sees Joe is, "Okay,
tact between members at all times have become a Joe's got a problem." So, now when you put
powerful symbol of collaborative teamwork. The Joe into the meetings, it's like, "Oh, it's that
electronic umbilical cord they have developed over complainer."
radio frequencies, to ensure that high levels of
information and idea sharing occur, sends power- In sum, it is hard to make a case that product-
ful messages about the connectedness among par- innovation settings with highly innovation-
ticipants and the priority attached to rapid, seam- supportive cultures produce different results be-
less information exchange. Additionally, during cause of readily apparent differences in the talents
the final phase of the new-product process, the and aspirations of their participants. The distinc-
leader has set up a trailer on the production floor, tive artifacts of highly innovation-supportive cul-
conspicuously titled Launch Control Center, which tures provide, on the other hand, one explanation
functions as the nerve center for the new-product for the somewhat dramatic differences that exist in
team. In addition to housing new-product-related participants' belief and value systems and behav-
documentation and serving as a meeting place ioral patterns, and for the differences in the new-
exclusively devoted to participants, it symbolizes product outcomes they produce.
Academy oi Management Executive August
CULTURE
(Beliefs, value systems, assumptions dominant in the social
and cognitive environment reflected in a consistent pattern of behaviors)
FIGURE 6
Co-evolution of Culture, Strategy, and the Product-Innovation Setting
new-product development outcomes (such as the ity of these leaders to harness the power of cultural
effect of structure on development speed or costs, artifacts has much to do with the internalization of
and/or on profit from sales), may well overlook the new values among participants. The importance of
central impact of the interactions and the resulting understanding the multiple subculturesand the
synergies that we observed. impact of stories, rituals, and physical symbols in
The complexity of interactions occurring at mul- shaping the links between multiple subcultures,
tiple levels suggests that highly innovation- explicit and tacit knowledge, and new-product
supportive cultures are more likely to emerge strategy and cultureis hard to overemphasize.
when leaders focus on simultaneous rather than
serial change and regard it as part of what they do
on a day-to-day basis. The context of three-way Culture as a Frame of Reference
adaptations appears essentially kaleidoscopic,
with potential for a large number of permutations. Our findings reinforce the notion that in times of
Changes in any one, i.e., in the new-product strat- uncertainty and ambiguity engendered by changes
egy, the underlying values, the behaviors, the in- in new-product processes, organizational culture can
frastructure, or cultural artifacts, triggers changes serve as a powerful frame of reference for thinking
in others, often in unpredictable ways. Unless and actions. Even if senior management favors inno-
carefully managed, they can spiral out of control, vation, implementation of new-product processes is
leaving leaders powerless to effect meaningful, frequently impaired by their inability to alter core
sustained change. Among other things, the anxiety cultural values and beliefs. The culture shock that
caused by the prospects of dealing with unin- participants experienceas they struggle to elimi-
tended consequences of these kaleidoscopic nate the influence of old stories, rituals, and artifacts,
changes seems to paralyze the leadership in low even as they develop new ways of thinking about
innovation-supportive cultures and increase their managing new-product-related decision-making
reliance on controls and directives.^^ and work flows, and new ways of thinking about
interdependent, collaborative relationships with
othersstands out in sharp relief in the firms we
Highly innovation-supportive cultures are observed.
more likely to emerge when leaders A careful analysis of an organization's culture
focus on simultaneous rather than serial the deeply held, tacit beliefs and value systems
that lie at the core of organizational thinking and
change and regard it as part of what actionand an intimate understanding of its so-
they do on a day-to-day basis. cially constructed fabric rich with stories, rituals,
and artifacts can be helpful in developing mean-
Education and training programs are widely ingful ways to understand why participants in
used and recommended by leaders from our highly new-product processes behave the way they do.
innovation-supportive cultures. However, the abil- We believe that such analysis must occur. After
2002 jassawalla and Sashittal 53
achieving acceptable levels of product-develop- ducted in the second phase of our study. We interviewed forty
ment effectiveness, the challenge of developing managers involved in new-product development from ten mid-
to large-sized high-technology firms (at least one from R&D,
significantly higher levels of collaboration, cre- marketing, and manufacturing from each firm). We also inter-
ativity, and innovation appears to relate to the way viewed individuals identified by participants as important con-
in which the fuzzy, amorphous nature of culture is tributors, such as project-team leaders and division heads. To
integrated with the hard, cold analysis of technol- encourage candid answers, we guaranteed confidentiality. All
ogy, customers, markets, and competitors. In this participants were asked all of the questions in our interview
fuzzy realm of interpretations, beliefs, and value protocol, and mostly in the same order to enable comparison
across responses. The depth-interviews were formative to the
systems He the clues for differentiating wildly in- extent that we asked probing questions and sought clarifica-
novative participants that take quantum leaps in tions and examples from each participant.
creativity and innovation from those that are just The interviews, lasting between 90 and 120 minutes, were
plain adequate. tape-recorded and transcribed. For content analysis, we fol-
lowed the guidelines offered by Blumer, H. 1969. Symbolic in-
teractionism: Perspective and method. Englewood Cliffs: Pren-
Endnotes tice Hall; Bogdan, C. R., & Bikien, S. K. 1982. Qualitative research
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ducted in two stages. We aimed to explore, identify, and de- ment Review. 21(4): 1143-1164- For commercial success as an
velop meaningful ways of thinking about the important and indicator of new-product-development effectiveness, see
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sues of new-product development based on the voices of man- large, mature organizations: Overcoming innovation-to-organi-
agers directly involved in the process. We initially conducted a zation problems. Academy of Management journal. 39(5): 1120-
literature review and a pilot study in which we depth-inter- 1153.
viewed six managers responsible for developing new products ^ See Frohman, op. cit.
from four high-technology firms. We asked them to discuss their ' See Detert, et al., op, cit., for discussion about the preva-
product-innovation-related thinking, actions, and interactions lence oi culture studies devoted to artifacts.
with others, and issues that they viewed as focal and problem- "For cultural artifacts without specific reference to product
atic. We content-analyzed their responses, revisited the litera- innovation, see Hofstede, G. 1991. CuJfure and organizations: Soit-
ture, and derived a set of research questions that were both ware oi the mind. London: McGraw-Hill; Martin, J. 1992. Cultures in
managerially relevant and understudied. organizations: Three perspectives. New York: Oxford University
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54 Academy oi Management Executive August
'^ For cultural artifacts of product-innovation settings, see '^Frohman, op. cit.
Buckler, S. A., & Zien, K. A. 1996. From experience. The spiritu- ^''Dougherty, D., & Heller, T. 1994. The illegitimacy of suc-
ality of innovation: Learning from stories. Journal oi Product cessful product innovation in established firms. Organization
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'^ Weick. K., & Roberts, K, 1993, Collective mind in organiza- uct technologies and the failure of established firms. Adminis-
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story performance in an office-supply firm. Administrative Sci- change: Linking complexity theory of time-paced evolution in
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Sitkin, S. 1983. The uniqueness paradox of organizational sto- Quarterly. 42 (1): 1-34.
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^^ Schein, E- H. 1996. Three cultures of management: The key
Buckler & Zien, op. cit.
to organizational learning. Sioan Managemenf Review. Fall:
'^ Pettigrew, op. cit; and Trice, H,, & Beyer, J. 1992. The culture
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oi work organizations. Englewood Cliffs, NJ: Simon & Schuster.
^^ Saffold, G. S. 1988, Culture traits, strength and organiza-
'^Schein, E. H. 1988. Are you corporate cultured? Personnel
journal. 65: 82-97. tional performance: Moving beyond "strong" culture. Academy
''' Since our learning originates from our exploratory study, it oi Management Review, 13 (4): 546-558- Also see De Long &
should not be construed as a how-to primer on cultural change, or Fahey, op, cit.
as easily replicable conclusions that guarantee results in all prod- ^'' Nonaka, 1. 1991. The knowledge creating company. Harvard
uct-innovation settings. Similarly, since our findings emerge from Business Review, 69(6): 96-105. Also see Mascitelli, R. 2000. From
high-technology manufacturing firms, our learning speaks mostly experience. Harnessing tacit knowledge to achieve break-
to managers involved in developing high-tech product-service through innovation. Journal oi Product Innovation Management,
bundles, rather than to those involved in developing new services. 17 (3): 179-193.
'^ Floyd, S. W., 8E Lane, P. J. 2000. Strategizing throughout the ^^ Schein, E. H. 1993, How can organizations learn faster? The
organization: Managing role conflict in strategic renewal. challenge of entering the green room. Sloan Management Re-
Academy oi Management Review, 25 (1): 154-177. view. 34 (2): 85-112.