CORPORATE STRATEGY PERSPECTIVE

GROUP ASSIGNMENT (GROUP 3)

Name Student’s ID
Dian Alanudin 1906417395
Fahrurrozi 1906445751
Nareswari Sumarsono 1906417445
R. Darmawan S.P. 1906462606

Course : Seminar on Corporate Strategy

(ECMS903013)
Date : 15 February 2020
Lecturer : Dr. Ir. Harris Turino, MM, MSi

STRATEGIC MANAGEMENT POSTGRADUATE PROGRAM

FACULTY ECONOMICS AND BUSINESS
UNIVERSITY OF INDONESIA
JAKARTA
2019

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 Abstract

This paper aims to elaborate on the perspectives of corporate strategy and its implication on
firm performance through seven journal review focusing on merger and acquisition aspects.
Helfat and Bowman (2019) are described whether the corporate strategy is a matter using
variance decomposition techniques. Matzler and Bauer (2013) stated that mergers and
acquisition (M&A) is considered to have a significant role in the growth as well as the
development of a corporation. Vrontis, Christofi, T.A., Shams (2019), focusing on how the
business-enhancing technological capabilities through M&A activities. Menon, A, and
Hernandez, E. (2018) emphasize how the Network change due to various corporate strategies
and how its impact on an immediate partner of the firm. In 2011, Ferreira, M. examined on
multinational corporations (MNCs), relations among subsidiaries and between headquarters
and subsidiaries with a focus on Ghoshal and Bartlett’s book. Almeira, M , Ferreira, Santos
JC, Reis N.R (2014) synthesized existing literature on M&A that focusing on strategy and
international business. It is shown that there is no individual theory considered superior in
the research field of M&A, and further research can be crucial to examine the contributions
of the main theoretical aspects. Using the case method in M&A, Reddy, K. S., (2015)
described summary and bibliometric analysis of previous studies in management research.

“Does Corporate Strategy Matter?” To evaluate such inferences, Constance and Edward,
2001 in his journal “Does Corporate Strategy Matter?” prepared the research question:
"What in theory are the corporate-level factors that influence firm or business profitability,
and to what extent do these factors reflect corporate strategy?" Answering these theoretical
questions will give an idea of the extent to which the corporate effects will link and relate to
the company's strategy. Rumelt in 1974 explained that these corporate-level factors reflect
profitability, the interrelation between diversification and company performance. These
corporate-level factors include the impact of vertical integration on the company
(Williamson, 1985; 1975), core competencies (Hamel and Prahalad, 1990), the importance
of M-form organization structure (Chandler 1977, 1962; Williamson, 1975), climate of
organization (Warnerfel, Hansen, 1989), system of control and planning emphasizing on
strategy over financial control (Campbel and Goold, 1987), the benefit of internal capital
markets (Liebeskind, 2000), corporate management include managerial ability (Andrew,

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1987; Hambrick & Mason, 1984). Constance and Edward (2001) paper contributes an
extensive summary of data, method, and outcome of the study about decomposition of
variance including corporate effects from Schmalensee in 1985 to Bercerra (1997), as shown
in Figure 1.

The importance of industry effects is emphasized on many variance decomposition studies

(e.g., Schmalensee, 1985; Porter&McGahan, 1997). As mention on Bowman in 1990, this
reflects a continuing debate about the market importance relative vs. company it self.
Business rather than corporate strategy is the main issue of the debate. Variance
decomposition analysis is often used to examine the degree to which corporate effects
influence their profitability. These studies investigate the effect of corporate strategy on
organizations. There are two methods on estimating business, industry effects and corporate
on the profitability variance and its components analysis that are used in decomposition
studies. By utilizing the median of returns to single corporations, businesses, and industries
in the procedures for decomposing the variance of returns. The effects of corporate obtain
the difference between business firms on average outcome to individual businesses inside
each organization.

Effect of industry obtains derived the difference among industries in average of outcome to
a single business within each industry. Business effect derives from the difference among
average business of each business annual return. Profitability influenced by corporate, comes
from businesses business inside individual corporations. Jack Welch, CEO of GE, has also
described the significance of corporate strategy: each business to be the best in planning and
implementing to smaller the size of business structure and improve organizational climate.
Grant in 1995 shows concerns of research in strategic management, in specific on the
corporate level. The example from Grant and Welch influences many factor on corporate
level that reflect profitability. Bowman and Helfat suggest theoretical matters; the impact on
profitability by corporate management limited not about core competencies building, which
embedded inside an organization that consit organizational routines. In conclusion, Bowman
and Helfat’s study examines that corporate-level factors reflected and influence to
company’s profitability or market share, as shown in Figure 1. According to Bowman and
Helfat, the strategy of corporation matters in differences of profitability among firms

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because of two main reasons. The first one, influence of corporation may contribute to
strategy corporation and its profitability if statistically derive from multiple businesses and
exclude single-business firms. Without information on a detail type of strategy, the linkage
between strategy corporation related to business or industry level can not be explained by
this research. Second, as empirical estimates, corporate effects influence corporate strategy
in variance profitability based on analysis and evidence (Figure 1). From the methods and
composition of sample in several of the studies, it tends to estimates that effects of corporate
is not reflecting corporate strategy influence on profitability (Rumelt 1991; Hoskisson, Kim,
and Hill 1993; Carroll, 1993; Ricart i Costa and Ghemawat, 1993; Ghemawat, 1994).
Despite all contradictory research, many of the studies (Rumelt 1974; Hansen and
Warnerfelt, 1989; Chandler, 1962,1977; Williamson, 1975; Goold & Campbel, 1987;
Liebeskind, 2000), except Rumelt (1991) and Schmalensee (1985) and estimate that effects
of corporate reflect its strategy (See Figure 1). As additional, in the form of different CEOs,
from ‘leadership,’ studies (see Figure 2) estimate that top management effect reflects on the
profitability of varian (see Figure 3). Yes, corporate strategy matters.

Another proof that corporate strategy does matter shown in the business network changes.
Business network basically contained some nodes (interfirm) and the ties that connecting it.
This structural network might be modified at its nodes or at the ties as an effect of changes
on business environment such as addition of tie on the case of new alliance establishment or
forming new joint ventures (Soda, Zaheer, Ahuja, 2012 ; Gargiullo and Gulati, 1999) or the
ties elimination due to alliance termination (Sanders, Tuschke and Hernandez, 2015;
Mitchel, Ahuja & Polidoro, 2011). On the existence of nodes, company take over makes the
nodes collapse, the divestment may split the nodes, new entries creates the new nodes and
nodes will be deleted once exit the industry (Menon, Hernandez, 2018). Most of corporate
strategy literatures haven’t captured the modification of nodes and ties relates to network
change. Refer to Menon A, Hernandez, E, 2018 journal, “Corporate Strategy and Network
Change” it explained and link properties of network changing on the six tie-node
modification with ego-network position (status, closure and openness) and how its effect to
immediate partner of the firms.

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Implication of Corporate Strategy to Network change journal focusses on understanding how
the network may change once the firms act for specific objectives. There are 6 corporate
actions for node and tie changing – deletion, addition, splits, collapses, exits and entries that
link to ego network (Closure, status, openness) and global network (i.e. modularity, size); (1)
Tie Addition (Figure 8. Panel 1-2): Its an addition of new nodes and form a new link among
two nodes. Its mainly to gain access for the resources such as assets, social support or
information (Lin, 2001; Lavie, 2006). (2) Tie Deletion (Figure 8. Panel 2-1): Termination
between two nodes mainly because of the partnership cant meet expected benefit as
expected. (3) Node Collapse (Figure 8. Panel 1-3): Node collapse happened during
acquisition process. There is a combined asset between both firms, to create more
synergistic power (Jemison, Haspeslagh, 1991). The effect of structural network change in
acquisition process is larger in compare to tie addition or deletion depend on how much the
ties affected. (Figure 9a and b); (4) Node Split (Figure 8. Panel 1-4): Node split relates to
divestment process. (5) Node Entry (Figure 8. Panel 1-5): For any new market or industry
entry, it will make a new node. If the new node is isolated (young and lack resourced firm)
the structural impact will not happen. (6) Node Exit (Figure 8.Panel 1-6): Node exit
happened when a company cease their business.

Bauer and Matzler (2013), in their journal “Antecedent of M&A success; The role of
strategic complementary, cultural fit and degree and speed of integration”, published in the
Strategic Management Journal (SMJ), also supporting that corporate strategy exists and
matter for the company. This journal stated that other than the JV and or strategic alliance,
mergers and acquisition (M&A) is also considered to have a significant role in the growth as
well as the development of a corporation. In other words, M&A is part of corporate strategy.
Although the journal also mentioned that several researches such as the ones of Bagchi&Rao
(1992) Christensen et al.,(2011) and Bower(2001) discussed about the failures of M&A
(some said that the failure rate is around 40% to 60%, and some even until 70% to 90%), the
journal still considered the importance have an in depth and comprehensive understanding
on what elements (or what constructs) could explain the success of an M&A. This is
practically the main objective of Bauer&Matzler (2013)’s journal, as it stated that the
objective of the journal is “(1) To develop an integrative and more holistic research model
that connects central constructs of three schools of thought (strategic management,

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organizational behavior, and process), and (2) generate a deeper understanding of the
interdependencies of the M&A phases and their effects on M&A performance”.

As the journal tested its theoretical framework in an empiric way using 106 sample of SMEs
M&A transactions within the electronic, machinery, and logistic industries in Central Europe
(focusing within the German-speaking countries), where SMEs according to Bauer&Matzler
(2013) normally not listed in the stock market are less stringent for financial disclosures
(including transparency reporting), the journal was basing its research only on three (out of
four) of the school of thoughts elaborated in figure 4, being the (1) strategic management, (2)
organizational behaviour, and (3) process/ perspective school of thoughts, but not the
financial economic school of thoughts. Using these as basis, as well as the prior works,
which have revealed that the success of an M&A are depended on both pre-merger and post-
merger issues, i.e the works written by Bower (2011) Barkema & Schijven (2008), and Voigt
and Stahl (2008), the journal derived into 10 hypotheses. Hypothesis 1 to 4 was testing the
positive relationship between M&A success and strategic complementarity (1), fit culturally
(2), integration speed (3) integration degree (4). Hypothesis 5 to 7 was testing the positive
link between the M&A success and cultural fit (1) integration speed (2) and degree of
integration (3). Hypothesis 8 to 9 was testing the positive relationship between M&A
success and degree of integration and the negative relationship among degree of integration
and integration speed. Whereas the last hypothesis was testing the positive relationship
among the M&A success and speed of integration. In a simpler words, Matzler WK and
Bauer,F, 2013 hypothesised that success of M&A is a function of (1) strategic
complementarity, as it is expected to provide corporations with not only efficiency synergies
(as what strategic fit could do), but also value creations, (2) cultural fit, which is not
perceived as only the similarity between related corporation, instead it is both similarity and
differences that could provide a mutual support to each other, and (3) the degree of
integration, which is the level of change within different organizational levels occurring on
the post-merger stage. Figure 5 visualized these hypotheses into a research model for the
journal.

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The data was collected using an internet survey methodology in summer 2010 (with
managers of the acquiring firms as respondents – considering that they are the ones who
knows more about both the M&A intention as well as during the post-merger stage
integration) and focusing on SMEs’ M&A transactions that occurred between January 2005
and April 2008. The dimensions being used for (1) strategic complementarity, are resource-
related dimensions, product market, value chain attributes, (2) cultural compatibility, are
strategy, structure, leadership, and interrelationship, (3) integration degree and (4)
integration speed, are production integration, socio-cultural integration, system integration
and marketing integration. All constructs were assessed using a 5-point scale, except for the
integration degree that is using a scale of 7-point. Whereas for M&A success, the
measurement was taken from managerial perspective using Baecker (2005) the measurement
model, consisted of (1) objective dimensions, “ranging from 1=strong negative development
to 7=strong positive development”, and (2) subjective dimension, with range from
“1=completely disagree to 7=completely agree” 1. Having conducted the research, the journal
shows the result being among others that (1) M&A’s success is positively related to the
degree of integration, strategic complementarity, and cultural fit, and (2) strategic
complementarity is related positively with the degree of integration and cultural fit , (3)
cultural fit is negatively related with both degree of integration, and speed (4) Integration
degree is positively link with the integration speed. Several limitations however (such as
design of longitudinal is difficult and quite problematic to be implemented and the limited
number of observations) were also stated in the journal.

Around 40% of M&A are cross-border activities (Jenner, Humphery, 2017). Its increasing
rapidly and become most significant strategy to improve firm performance (Hagedoorn,
Duyster, 2002; Ferraris et al, 2017; Zhu et al, 2019). At the same time there are also
evidence showing that many acquiring firm fail to earn more value out of M&A’s cross
border (Zhu, 2019; Huang, 2016). In addition, many studies explained that variable of
financial and strategic are less significant on pos-M&A performance and its more necessary
to focus on different factor (Christofi, 2017, Weber, 2011, Rozen-Bakher, 2018). By that,
researcher consider investigating performance after the acquisition and how the business
enhancing technological capabilities through this activities. In the past three decades,

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Bauer,F. and Matzler, W.K. (2013)

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surprisingly it was no comprehensive study on the topic of M&A’s that enhancing
technological innovation as well as its impact to firm performance

The fourth journal from Ferreira, Santos, Almeira, and Reis (2014) is a bibliometric study
on this topic started off with emphasizing the importance of M&A for firms in conducting
their international and domestic strategies. They also acclaimed that M&A is CEOs favorite
strategy. This is supported by several authors such as Hitt et al.,(2001) stating that “M&As
have become major strategic tools for multinational corporations’ growth”, Laamanen &
Keil (2008) reveal “M&A have significant impact on firms’ performance” and Capron &
Pistre (2002) disclose about “M&A hold long-term consequences for the firm”. The sample
used in the research consisted of 334 articles that were published in 16 prominent business/
management journals, since 1980 to 2010 (within 31 years) and referring to Peng&Zhou
(2006), Datta et al.(1992), Podsakoff et al. (2008), King et al.(2004), and Shafique (2013),
the articles/ journals selection was performed using rangking of Anne-Will (2011), impact
factors of the journals, as well as studies before using same or several set of journals.
Furthermore, coding were conducted to classify the 608 different keywords supplied by the
author, into one of the 19 major themes: Two coders classified each of keyword and combine
it into one of the following major themes: “Performance”, “Environmental modeling:
governmental, social, and political influences on strategy”, “Diversification and corporate
strategy”, “Resource based view (RBV) and capabilities of the firm”, “Methodologies,
theories and research issues”, “Learning and knowledge”, “R&D, technology innovation”,
“Financial theory”, “Culture, Organization and structure”, “Agency theory”, “Institutional
theory”, “Corporate partnership”, “CEOs and top management teams (TMT)”,
“Restructuring”, “Integration issues”, “Corporate governance”, and “Entry modes and
international strategy”. In terms of the analysis, despite of the various ways in conducting
bibliometric study, Ferreira, Santos, Almeira, &Reis (2014)’s study was referring to Ruiz-
Navarro’s and Ramos-Rodriguez (2004) “procedures in their analysis of the intellectual
structure of strategic management research”, and Furrer et al. (2008) method on identifying
the research theme. With these as basis, three structural and longitudinal analyses that were
considered complementary were conducted in the study: (1) Citation analysis 2 , which is
assessing the impact of the work through the citation frequency of the work being used as

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A reference/ citation, is “the acknowledgement that a paper gives to a previously published work”. (Ferreira, M. P.,
Santos, J. C., Almeira, M. I. R., and Reis, N. R., 2014)

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sample, (2) analysis of co-citation, which is assessing intellectual interconnections among
the authors as well as the works through calculating a pair of works frequency is together
cited in articles being published (McCain, White, 1998), and (3) the themes of the research.

Result in terms of citation analysis shows that the book “Managing acquisitions: Creating
value through corporate renewal” by Jemison and Haspeslagh (1991) was cited mostly and
thus considered as the most relevant work in M&A subject. This is followed by the paper of
Jemison and Sitkn (1986) and then by Lubatkin (1987). Ferreira, Santos, Almeira, &Reis
(2014) mentioned that the top two most cited works are link with the post-acquisition topic
that follows the RBV, which is focusing on the capability transfer and effective integration.
In order to comprehend the shift from time to time, a longitudinal analysis was also being
held as shows that the most cited articles are Lubatkin (1983) for the period 1981-1990,
Jemison and Sitkn (1986) for 1991-2000 and Haspeslagh and Jemison (1991) for 2001-2010.
The longitudinal research result shows that there is a shift in terms of theoretical focus, from
traditional perspective (economics perspective and transaction cost theory) to performance
perspective (using financial and transaction cost theory) and subsequently to the RBV
(including knowledge, capability and learning). In the terms of co-citation, figure 13
illustrates the result with the co-citation links represented through the lines (the more thicker
the lines the more stronger the tie between pair of works) and the position of the works (the
more central the works indicate the more relevant the works). Whereas in terms of research
theme, (1) figure 14 illustrates the result with the largest circle means that it is the themes
being the most researched on and the thicker the lines between the two themes indicate the
stronger the relation between the two, and (2) figure 15 illustrates the result by period of
time. Furthermore, the research has shown that there is no individual theory considered
superior in research field of M&A and further research could be crucial to examine the
contributions of four main theoretical aspects; (1) Agency theory, (2) Institutional theory, (3)
Transaction cost theory and (4) the Resource-based view (RBV). At last, in terms of research
limitation, although the paper stated its confidence of the articles collected as samples, it
stated that future studies might want to extend the number of the articles. Also, as the paper
was using a proxy of “author-supplied keywords” during the research theme analysis, which
is considered not as deep as content analysis, future research might want to conduct content
analysis to enhance the depth of the theories being used in the samples.

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Fifth journal from Michael Christofi et al, 2010 “Triggering Technological Innovation
through cross-border M&A; a micro foundational perspective” provides link between
M&A’s as corporate strategy and Innovation technology in 3 way; First the literature review
of past extant research to understand about creating value through technology innovation
during cross-border M&A’s, Second providing conceptual integrative framework to
interrelates critical factors and effect intermediary, and third, identifying several research
gap of extant literature. This research focused only on cross-border M&As topic, the micro
foundation on enhancing innovation technology as well as other ideas which might trigger to
any new innovation. The research question defined as ; “On the value capturing and value
creating factors, what are the micro foundation of technological innovation within cross
border M&A’s, and what is the consequent impact to the firm performance”

Findings from literature review: (1) Organizational culture and Social Culture – The authors
focus on the consequence of cultural and geographic difference with the “foreignness” and
newness” shown as factor that impact the micro foundation level especially to improve
higher performance on innovation and productivity. The “newness helps to increase
innovation (Sears, 2018), (2) Similarity & Technology Overlap – Rabbiosi and Colombo,
2014 found that ‘Technological similarity’ that might facilitates the change of incompetent
leader, to improve better performance in innovation as well as the productivity. The author
highlighted that negative effect of technological overlap can be reduced through routine
knowledge sharing (Park, 2018). It was also mentioned that the innovation performance can
be increased when there is more routines overlap and moderate skill overlap, (3) Social
capital and HRM –Social Capital Role together with configuration of HRM on sharing the
knowledge after the integration of M&A mainly on cognitive and interpersonal, will increase
the employees' share knowledge ability. Its important to facilitate knowledge sharing
conducted by integration team (4) Social community & integration – Lord and Ranft (2002)
explained about transfer of knowledge in the form of communication and social capital,
Ahmad, (2016) focus the same things with employee retention and cultural distance , while
Aklamanu (2016) related this to social capital (5) Structure, processes and size – Lee and
Kim (2016) did some research on firm size effect on innovation where the small firms are
having better position to market based innovation, while bigger size company they have
better communication between their department that might affect to increase innovation as

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well. (6) Strategy – James et al. (1998) conclude that the level of technology integration
decision process, influence the effect of acquisition to the firm innovative capability. This
journal also specifically emphasizes that communication is important to make sure that
employees understand why acquisition is happened. (7) Leadership and Top Management
Commitment – Klavans et al. (1985) highlight that managerial level performance bonus is
link to success of the firm, as non-direct benefits. It is also explained that firm who
implement procedure how to find out and utilize innovation opportunities will be more agile
on innovations scout. According to Hitt (1990) he focusses on commitment of management.
He also explained that structured acquisition process , and the outcome conditions, will help
to get more commitment from management. (8) Framework with Integrative concept – From
systematic literature review, author summarizes the multi-dimensional framework in M&A’s
technological innovation as shown in figure 6 and 7. The author created a framework
with an integrative concept that help us to identify two issues: inferences of association and
fragmentation.

Several researchers over the period of time, has tried to conduct a bibliometric study in
M&A using sources ranging from books, journals as well as case study. We tried to captured
three Bibliometric study in this paper described as following: During the period from 1989
to 2010, the publications that are examined: a leading IB journal: JIBS. It is a leading journal
specific for research in IB. (Inkpen &Morrison, 1991, Dubois&Reeb, 2000;
Phene&Guisinger, 1998; Beamish&Inkpen, 1994;). To be more successful, competitive and
can also exploit the potential, MNC had access and may develop potential from different
area with technological space focus. This matters can be found in Ghoshal’s work, consist of
case studies, 12 books, and 70 papers. Overall, it becomes continuous effort to get useful and
relevant work (Ghoshal 2005, Ghoshal and Moran, 1996,), to link practical and theory of
MNCs and Managers (Ghoshal&Bartlett, 1994; 1995).

This six journal conducted by Ferreira, MP, 2011 is to analyzed specifically published
research articles and extent which Ghoshal’s and Bartlett (1989) on across borders
management using solution of The Transnational that used in the the content of that
research, as well as research of extant IB. According to Diodato (1994), the bibliometric

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purpose is to identify extant research pattern. The required empirical data were sourced from
isiknowledge.com, for the articles cited by Ghoshal’s and Bartlett and (1989) and was
published in JIBS (Figure 10). The second author last name was entered to identify citations
in the “search key” and select only the relevant work. After 1989, there are 82 published
articles in JIBS were identified by search procedure. From this papers, two software;
Bibexcel and Ucinet was used to treat and collect relevant information. Within this period
of time, there are 967 works, consist of 38 proceeding papers, 83 as reviews and the rest are
846 articles. Among it, Ghoshal and Bartlett (1989) cited 82 articles and it was about 8.5
percent.

The data was analyzed in three group: 82 articles Citations and co-citations, the use of
keywords as well as papers authorship (refer to figure 11a and b). The research focus at
particular domains according to authorship could arguably be found. Most cited of top 20
works recognized in 1989 – 1999 period and 2000 to 2010 period. According to co-
authorships the networks were formed within these 82 articles. Paper by Doz and Prahalad
(1987), Casson and Buckley (1976), Hedlund (1986), Porter (1985), oftenly cited with
Ghoshal and Bartlet (1989). Hofstede (1980), Wells and Stopford (1972), Kogut and Singh
(1988) also have stronger tie with Ghoshal’s and Bartlett (1989) work. The tie strength is
reflected from proximity between keywords. Trans-national concepts of Ghoshal’s and
Bartlett (1989), using the keywords analysis used six themes which are : strategic advantage
and entry modes; international, multinational strategies, global ; MNE; subsidiaries;
knowledge, RBV; and clusters, geography, regional. “MNE” and “subsidiaries” keywords
are closer since quite big number of research focus on multinationals as well as focus on
subsidiaries. “Human resource management” and “knowledge, resource-based view”
keywords, are far in between, since only limited papers that dealing with knowledge and
RBV – at the same time also deal with HRM issues. The most frequency topic used in
articles that citing Ghoshal’s and Bartlett (1989) work is shown in figure 12. Issues relates to
“RBV, knowledge”, “subsidiaries,” “MNEs,” and “entry mode, internationalization, may
also be observed as stronger cluster. It can also be seen that experiences, strategies issues
implement in foreign firm operations, and concern on managing cross border MNC’s is
most influence factor for Ghoshal’s and Bartlett works.

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The last journal, Reddy K.S. (2015) in this journal “The state of case study approach in
M&A literature; A Bibliometric Analysis”, published in Future Business Journal 1, focuses
on examining the case study method in literature which are related to mergers and
acquisitions due to different causes. Initially, it provided bibliometric argument and
conclusion of earlier research on mergers and acquisitions using case based method. He
underscored more than 90 articles applying case method where majority emphasize on
developed market and emerging markets, while the rest used single and multiple case studies
and very few use survey and interview. Next, it proposed guidance for enhancing some issue
s in research for instance on quality and validity, triangulation, and case study procedures.
Moreover, it mentions main pillars of case study method: selection criteria, sampling area,
sampling time, and the sampling itself. The article summarize that the use of case method
especially in mergers and acquisitions-related studies and in overall management study has
embraced to developing markets settings for goals ranging from case study, examining
existing theory and inventing new theory, and predict more advance use of it within various
management streams.

Contemporary research subjects, namely causes of failed acquisitions in international and

local context, management of integration after merger, problems and challenges subsequent
to foreign acquisitions, dealing mechanism and responsibilities of leaders, cessation of
leaders in winning and losing commitment, features and backgrounds of corporates in
emerging markets joining foreign acquisitions, and personnel capacity building and
organizational shift performance provide extraordinary settings to apply the case based study
in the forthcoming research. As stated above, Reddy K.S (2015) journal is aiming to
understand the circumstances of case based research in literature of M&A for the following
reasons: (1) He investigates background of earlier studies using case based method in
mergers and acquisitions journal. (2) He then revisit methodological protocol referring to
validity and quality of research in non-empirical contexts. The study has been driven by the
up to date market trends happened in emerging market and shifts in dimensions of
organizational framework that are contributing to the development strategies of the
corporates , for example in joint ventures and acquisitions.

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The journal examined its theoretical frameworks in a qualitative method using case studies
from 93 previous journal articles. Based on Reddy K.S. (2015) the adoption of case based
research is one of most recommended methods in qualitative research, particularly because
its critical and accessible nature, which has obtained remarkable importance in various
disciplines. Along this line, Yin (1981) explains the scheme of case based approach and
describes it as one of strategies in research, establish a typology of case based research
methodology, and recommend the logic for replication, which are important for analyzing
multiple cases. Refer to figure 16 where Reddy K. S. (2015) describes schemes which would
assist qualitative researchers in management disciplines, for instance in methods related with
samplings. As an example, a well blend of sampling cases will not only enhance validity and
quality of research but also increase the ability of findings to be transferred. Please refer to
figure 17 and 18. Reddy K.S. (2015) particularly underline on two angles, specifically how
do we resolve issues surrounding to collection of data, and the way to ensure quality research
within the limitation of case based study. Triangulation: Triangulation of data assists the
scholars in a broad of study activities such as putting together study objectives, study design
and procedures, examining theory and significantly, theory establishment. It sets out
characteristics of case based method (Ghauri & Firth, 2009).

Eriksson and Kovalainen (2008) address that triangulation is necessary to integrate

quantitative and qualitative data or materials, especially in case based method. Reddy K.S.
(2015) describes data triangulation as a combination of various data gained from various
origins, both secondary and primary data. Investigator triangulation – assigning multiple
scholars would be beneficial if the research involves multidisciplinary study, or build on
various theoretical schemes. (Stake, 1995). While theory triangulation – Yin (2003)
recommends it is a practice combining various understanding originated from various
theoretical schemes, in major such as supply chain, corporate finance, strategic, accounting,
production, transportation, law, hospitality, among others (Haleblian et al., 2009). Case
study protocol: Yin (1994) claims that case scholars must establish an appropriate set of
conducts, rather than applying bias decisions. Quality and validity: Reddy K.S. 2015
investigate the quality of the case based research in management study for different
purposes. Like qualitative approach, case study scholars must verify the study accuracy in

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terms of its consistency, develop validity, external and internal validity (Cook & Campbell,
1976).

Conclusion

It was a view from revisionist regarding corporate strategy in recent years claiming that
based on early variance decomposition empirical result, that corporate strategy does not
matter. According to this view, it found very small corporate effect that link with
profitability differences among businesses. In later day, Constance and Edward, 2001 did an
analysis of variance decomposition literatures and provide the conclusion that this view
seems incorrect. They shown that organization corporate level contributes to profitability
differences, and some evidence suggest that factors link to corporate strategy contribute to
corporate effect. According to Bowman and Helfat, the corporate strategy indeed matters in
differences of profitability among firms because of two main reasons; first, influence of
corporation may contribute to strategy corporation and its profitability if statistically derive
from multiple businesses and exclude single-business firms. Second, as empirical estimates,
corporate effects influence corporate strategy in variance profitability based on analysis and
evidence. As additional, in the form of different CEOs, from 'leadership,' studies estimate
that top management effect reflects on the profitability of variance.

The second journal that supporting the proof that corporate strategy does matter shown in the
business network changes. This paper focusing on M&A’s, how its impact to network, its
antecedent, obstacles as well as bibliometric studies on this topic. Network, that consist of tie
and nodes, may change once the firms act for specific objectives such as M&A. There are 6
corporate actions for node and tie changing – deletion, addition, splits, collapses, exits and
entries that link to ego network (Closure, status, openness) and global network (i.e.
modularity, size). Addition of tie on the case of new alliance establishment or forming new
joint ventures (Soda, Zaheer, Ahuja, 2012 ; Gargiullo and Gulati, 1999) or the ties
elimination due to alliance termination (Sanders, Tuschke and Hernandez, 2015; Mitchel,
Ahuja & Polidoro, 2011). On the existence of nodes, company take over makes the nodes
collapse, the divestment may split the nodes, new entries creates the new nodes and nodes
will be deleted once exit the industry (Menon, Hernandez, 2018).

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Another research about corporate strategy, from the perspective of success factor of M&A,
conducted by Matzler WK and Bauer,F, 2013. This journal hypothesized that success of
M&A is a function of (1) strategic complementarity, as it is expected to provide corporations
with not only efficiency synergies (as what strategic fit could do), but also value creations,
(2) cultural fit, which is not perceived as only the similarity between related corporation,
instead it is both similarity and differences that could provide a mutual support to each other,
and (3) the degree of integration, which is the level of change within different organizational
levels occurring on the post-merger stage. Beside all of the journal mention above, it was
several bibliometric analysis has been published on Corporate Strategy development,
focusing on different area such as within the topic of Quantitative Research in M&A; Ghosal
(Cross border acquisition), Christofi (Technological Innovation in M&A within the
perspectives of individual) as well as Reddy (How to enhance reliability and validity).

From this seven journal, we also detected that no single theory has been dominant in M&A
research and we may indeed observe the contributions of four main theoretical strands:
Agency theory, Institutional theory, Transaction cost theory and the Resource-based view
(RBV) . M&A research has been growing steadily over the past three decades. Although
there is an upwards trend, evidence shows that research on M&As is rather scarce,
consistently below 3% of the total articles published. However, using a longitudinal
perspective we may observe some intellectual changes such as the decrease in the use of
financial theory and more management and business focus. Corporate Strategy, its consist of
several actions such as M&A, Divestiture, Diversification, Joint Venture and several others.
This seven paper focusing on M&A’s and proof that, Yes, corporate strategy matters.

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 Figures and Tables

Figure 1 – Variance decomposition studies (E. Bowman, C. Helfat, 2019)

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 Figure 2 – Leadership studies (E. Bowman, C. Helfat, 2019)

Figure 3 – Top management effects (E. Bowman, C. Helfat, 2019)

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Figure 4. Research foci in M&A literature (Bauer,F. and Matzler, W.K., 2013)

Figure 5. Research model (Bauer,F. and Matzler, W.K., 2013)

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Figure 6. Micro-foundations preliminary framework of value creating - capturing factors of technological innovation in
M&As.
(Christofi, M., Vrontis, D., Thrassou, A., Shams, S. M. R., 2019)

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20
21
Figure 7. Interrelation of value creating- capturing factors of technological innovation in M&As and its intermediary
effects (Christofi, M., Vrontis, D., Thrassou, A., Shams, S. M. R., 2019)

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 Figure 8. Node and tie changing actions (Hernandez, E. and Menon, A., 2018)

Figure 9a. Additive node collapse: Hyseq acquires Variagenics (Hernandez, E. and Menon, A., 2018)

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Figure 9a. Subtractive node collapse: Solexa acquires Lynx (Hernandez, E. and Menon, A., 2018)

Figure 10. Networks among authors that cite Bartlett and Ghoshal (1989) (Ferreira, M. P., 2011)

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Figure 11a. Co-citations among the top 20 most cited authors referencing Bartlett and Ghoshal (1989) in JIBS (Ferreira,
M. P., 2011)

Figure 11b. A keyword analysis (Ferreira, M. P., 2011)

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Figure 12. The top 20 most cited works in JIBS (Ferreira, M. P., 2011)

Figure 13. Co-citations network among the top 30 most cited articles
(Ferreira, M. P., Santos, J. C., Almeira, M. I. R., and Reis, N. R., 2014)

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 Figure 14. Research themes (Ferreira, M. P., Santos, J. C., Almeira, M. I. R., and Reis, N. R., 2014)

Figure 15. Top research themes by period (Ferreira, M. P., Santos, J. C., Almeira, M. I. R., and Reis, N. R., 2014)

Figure 16. Case study research: design and procedure (Source: Yin 2003 in Reddy K.S. 2015)

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 List of abbreviations : DMs – developed markets; EMs – Emerging markets.

Figure 17. Bibliometric analysis of case study research in M&A literature (N = 93 papers) (source : Reddy, K.S. (2015)

Figure 18. Number of papers using case method in M&A research (Reddy K.S. 2015)

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 References

 Bowman, E. and Helfat, C. (2000). “Does Corporate Strategy Matter?”. Strategic

Management Journal, vol 22, issue 1.
 Bauer,F. and Matzler, W.K. (2014). “Antecedents of M&A success: The role of
strategic complementarity, cultural fit, and degree and speed of integration”.
Strategic Management Journal, 35: 269–291.
 Christofi, M., Vrontis, D., Thrassou, A., Shams, S. M. R. (2019). “Triggering
technological innovation through cross-border mergers and acquisitions: A micro-
foundational perspective”. Technological Forecasting and Social Change Journal,
vol 146, 148–166.
 Ferreira, M. P. (2011). “A Bibliometric study on Ghoshal’s Managing Across
Border”. The Multinational Business Review, Vol 19, No 4, 357–375.
 Ferreira, M. P., Santos, J. C., Almeira, M. I. R., and Reis, N. R. (2014). “Mergers &
acquisitions research: A bibliometric study of top strategy and international business
journals”.
 Hernandez, E. and Menon, A. (2018). “Corporate Strategy and Network Change”.
Academic of Management Review.
 Reddy, K. S. (2015). “The state of case study approach in mergers and acquisitions
literature: A Bibliometric analysis”. Future Business Journal 1, 13 – 34.

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