Overview: Multi-Level Issues in Organizational Behavior
and Strategy
INTRODUCTION
Multi-Level Issues in Organizational Behavior and Strategy is Volume 2 of Research in Multi-Level Issues, an annual series that provides an outlet for discussion of multi-level problems and solutions across a variety of fields of study. Using a scientific debate format of a key scholarly essay followed by two commentaries and a rebuttal, we present in this series theoretical work, significant empirical studies, methodological developments, analytical techniques, and philosophical treatments to advance the field of multi-level studies, regardless of disciplinary perspective.
Similar to Volume 1 (Yammarino & Dansereau, 2002), this volume, Volume 2, contains five major essays that cover a range of topics, but in the realms of organizational behavior and strategy. In particular, the five critical essays offer extensive literature reviews, new model developments, methodological advancements, and some empirical data for the study of emotions, construct validation, firm performance, interfirm networks, and strategic change. While each of the major essays, as well as the commentaries and rebuttals, is somewhat unique in orientation, they share a common bond in raising and addressing multi-level issues, or discussing problems and solutions that involve multiple levels of analysis.
EMOTIONS
In the first essay, Ashkanasy addresses the ephemeral nature of emotions in organizations via a critical literature review focusing on five levels of analysis. Beginning at the most micro level, he examines within-person variation in emotions defined in terms of affective events theory. He then considers more traditional work on emotions in terms of individual differences (or between-persons variation). Ashkanasy proceeds to discuss emotions and emotion-linked behaviors in terms of dyadic (interpersonal) relationships and also group- and team-based and organization-wide (e.g., culture and climate) perspectives. Finally, he proposes an initial integrated multi-level model of emotions in organizations that combines all five levels of analysis. From micro-level neurophysiological processes that underlie the emotional experience, through macro-level phenomenon such as an emotionally healthy organization, Ashkanasy shows the uniqueness of emotion-related constructs at multiple levels of analysis. He then is able to cross levels of analysis, proposing a multi-level framework for emotions in organizations.
In her commentary on Ashkanasy’s work, Isen argues for the integration of affect, cognition, and motivation, and suggests that this integration can be especially helpful in understanding organizational behavior. She points out that recent research has made clear that it is a misconception to think that positive affect typically leads to heuristic processing and interferes with systematic cognitive processing. Weiss, in another commentary, notes the strengths of Ashkanasy’s work are the analyses of core biological processes, the discussion of within versus between person analyses, and the distinction drawn between moods and discrete emotions. He then offers ideas on process integrations among levels of analysis regarding emotions. In his response to Isen and Weiss, Ashkanasy argues that biology both constrains and guides theory at each level of his integrative model. He also develops additional points regarding aggregation bias and the possibility of extending the model to include industry and region levels.
CONSTRUCT VALIDATION
In the second essay, Berson, Avolio, and Kahai propose an approach for verifying the level of analysis of a construct, as part of the construct validation process. Their approach relies on the use of quantitative and qualitative methods in measurement and operationalization of a construct as well as triangulation of these methodologies in a grounded theory approach. In particular, Berson et al. offer a process model in which level specification begins with induction of constructs, followed by qualitative and quantitative operationalizations, convergence of information via triangulation and aggregation tests (e.g., WABA), and continued construct development until the level of analysis is accurately specified. Using both theory and data from the literature on leadership, they provide an example of this induction-deduction-verification process.
In his commentary on the work of Berson et al., Gephart provides a discovery-oriented reading of grounded theory which supplements the verification oriented approach to level specification. He addresses how grounded theory can be used to discover new constructs, surface properties of constructs, validate constructs, and enhance understanding of levels of analysis of constructs. Two approaches to integration of qualitative and quantitative data in grounded theory are discussed: the linking approach and computer aided interpretive textual analysis. Parry, in another commentary, indicates the grounded theory method is more appropriate than just a grounded theory “approach,” for teasing out the detail of the level of analysis of constructs. Also, triangulation is important to this kind of research, but the methodological distinctions between qualitative and quantitative data and qualitative and quantitative analysis need to be made clear when mapping out a methodology. His contention is that the qualitative analysis of quantitative data is more important than the quantitative analysis of qualitative data. In their response to Gephart and Parry, Berson et al. include qualitative methods to augment the discovery process associated with construct validation. Beyond quantitative methods, they demonstrate the utility of using a discovery-oriented approach to level specification.
FIRM PERFORMANCE
In the third essay, Short, Palmer, and Ketchen consider the various multi-level influences on firm performance. To do so, they show insights from and integrate two streams of work resource-based view of the firm and strategic groups research that rely on different levels of analysis in strategic management. Resource-based view (RBV) of the firm, relying more so on the firm level of analysis, asserts that sustained competitive advantage is attained when firms possess unique resources. Strategic groups research (SGR), relying more so on the industry (i.e., groups) level of analysis, asserts that multiple firms within the same industry can attain sustained profitability with strategies that are similar to one another, yet distinct from other industry members. Through a conceptual integration, Short et al. offer propositions that cross levels of analysis to acknowledge and make clear the compatibilities of the two views. In particular, focusing on differences within and between strategic groups and between firms, they adopt a multi-level view about contingencies when firm differences, strategic group processes, or both may lead to sustained competitive advantage.
In his commentary on the work of Short et al., Joyce notes that further integration of the RBV and SGR approaches requires combining variables from the different levels of analysis, recognizing the MESO nature of both the relationships among these variables as well as the fundamentally inter-level character of these variables themselves. His framework shows that the meaning and measurement of the terms, as well as the statistical procedures used to test relationships among them, must be better understood to extend an initial integration of RBV and SGR. Michael, in another commentary, indicates that strategic group theory has two distinct aspects. The first is a resemblance among firms grounded in a common pattern of investment; the second is a mutual dependence among firms in the strategic group. He analyses each aspect to develop implications for research in general and multilevel research in particular. In their response to Joyce and Michael, Short et al. note the need to include managers’ cognitions in studies, emphasize the role of theory in studying strategic groups, describe the value of creating conceptual clarity regarding strategic groups, and offer suggestions for future studies.
INTERFIRM NETWORKS
In the fourth essay, Moldoveanu, Baum, and Rowley discuss the role of network-level information regimes (e.g., how widely distributed is a piece of information and whether there is common knowledge based on a piece of information) and firm-level information strategies (i.e., cooperative or competitive) in the evolution of interfirm network topologies (i.e., presence of cliques and vertex covers). They introduce, based in part on game theory, a multi-level model of the dependence of interfirm network topologies on the distribution and commonality of information in a network and the information strategies pursued by the member firms. Moldoveanu et al. assert that information properties of the network, network topology, and firm-level activities within the network form dynamic, recursive, cross-level relationships that change in kind in the short and long run. Because information properties in the network determine firm-level action, which in turn impacts the network topology and information properties, they argue that firms must adopt different kinds of information strategies to succeed within different information regimes.
In his commentary on the work of Moldoveanu et al., Madhavan notes their approach highlights the importance of developing a multi-level theory of network evolution that explicitly accounts for strategic agency and bounded rationality. He then discusses intriguing questions raised by their model about structure vs. topology, feedback loops in evolution, and network resources other than information. Walker, in another commentary, addresses the problem of interfirm network formation from the perspective of multiple types of relationship content and network structure. The approach builds on earlier work on typology of network structures and a range of empirical studies on interorganizational networks. In their response to Madhavan and Walker, Moldoveanu et al. consider three accounts or theses—weak, semi-strong, and strong—to show the usefulness of and emerging insights from their information-based explanatory strategy. They illustrate underlying information dimensions from past research and demonstrate the potential value of their current work.
STRATEGIC CHANGE
In the fifth and final essay, Jelinek offers a time- and levels-based view of strategic change for enacting the future of an organization. She integrates previous research on cognition, organizational learning, strategy, and organization theory to provide insights to strategic intention via a multi-level, longitudinal account of change in core competence of a mature-industry firm. The key idea presented by Jelinek is how knowledge passes from an individual to an organizational level, and how insights obtained in one portion of an organization are transmitted or infused more broadly in the organization. Similar to the ideas of Dansereau, Yammarino, and Kohles (1999) on how constructs and entities can shift in levels of analysis over time, Jelinek presents a depiction of change as a cognitive process and sense-making that involve multiple individuals, groups, and levels within the organization over time.
In her commentary on Jelinek’s work, Argote discusses connections between Jelinek’s analysis of strategic change and research on organizational learning. Points of convergence and divergence between the strategic change case and the organizational learning literature are identified in three areas: the role of experience in organizational learning, knowledge transfer within and between organizations, and the embedding of individual knowledge in organizational memory systems and supra-individual routines. Schoonhoven, in another commentary, notes that strategic change and managerial cognitions are closely connected. She then attempts to reconcile knowledge about managerial cognition and how the cognitive model can be applied to strategic change. In her response to Argote and Schoonhoven, Jelinek attempts to make further sense about strategic change by focusing on learning, cognitions, and levels of analysis. She elaborates ideas on learning and knowledge as well as alternative views of her case data in terms of levels issues.
CONCLUSION
The critical essays, pointed commentaries, and focused rebuttals in this volume reflect a variety of approaches for addressing multi-level issues in the fields of organizational behavior and strategy. While offered within the context of these two disciplines, much of what has been written here provides insights, applications, and potential advances to other realms of scholarly investigation. The authors in this volume have challenged theorists, researchers, and methodologists to raise and address multi-level issues in all their disciplinary and interdisciplinary efforts. If you would like to contribute your ideas to this scholarly endeavor, please contact us directly or visit our website at: www.levelsofanalysis.com.
ACKNOWLEDGEMENTS
The publication of the Research in Multi-Level Issues annual series and this volume have been greatly facilitated by Tom Clark, Catherine Hutchinson, and Deborah Raven at Elsevier Science in the United Kingdom. Closer to home, we thank our respective Schools of Management, the Center for Leadership Studies at Binghamton, the Jacobs Management Center at Buffalo, and our respective secretaries, Marie Iobst and Cheryl Tubisz, for their help in preparing this book for publication. Finally and perhaps most importantly, we offer our sincere thanks to our wonderful contributors. The authors of the essays, commentaries, and rebuttals in this volume have provided interesting ideas and insights for unraveling the challenges of dealing with multiple levels of analysis and multi-level issues. Thank you all.
REFERENCES
Dansereau, F., Yammarino, F.J., & Kohles, J. (1999). Multiple levels of analysis from a longitudinal perspective: Some implications for theory building. Academy of Management Review, 24, 346-357.
Yammarino, F.J., & Dansereau, F. (Eds.) (2002). The many faces of multi-level issues (Vol. 1 of Research in Multi-Level Issues). Oxford, UK: Elsevier Science.
Francis J. Yammarino
Fred Dansereau
Editors