Philipp Meyer-Doyle, Assistant Professor of Strategy at INSEAD
Abstract: Acquisitions are an attractive means of exploration (sourcing innovation and new technologies externally) as well as exploitation (capturing economic value from existing resources through economies of scale); they shape the capabilities of firms and critically impact the longevity of firms and their competitive advantage. While much of the existing literature has focused on firm-level antecedents of a firm’s exploration and exploitation behavior, we know surprisingly little about the impact that individuals have on the firm’s explorative and exploitative acquisition behavior through their specialized human capital. Yet an emergent stream of literature has shown that the specialized human capital of executives has an important impact on firm behavior and rent generation). Thus, in order to better understand the antecedents of exploration and exploitation behavior of firms, and thereby also the factors driving the evolution of firm capabilities, is important to study how individual human capital-level factors drive a firm’s explorative and exploitative acquisition behavior. This research project examines how the specialized human capital of key individuals in organizations, developed in prior explorative or exploitative acquisition experiences, shapes the firm’s explorative or exploitative acquisition behavior in the future; the research context for this project is corporate acquisitions of new technologies and innovation (explorative acquisitions) or of existing technologies which create economies of scale (exploitative acquisitions).