Abstract

Corporate ventures and existing businesses require fundamentally different and inconsistent competences that create paradoxical challenges. Accordingly, scholars have argued for structurally separating venturing activities (Burgelman, 1985; Drucker, 1985; Hill and Rothaermel, 2003), since it increases flexibility and frees corporate ventures from inertial effects of mainstream businesses (Burgelman, 2002; Dougherty, 1995). Organizations, however, need not only to allow for variety and local adaptation in corporate ventures, but also facilitate knowledge sharing and strategic coherence with ongoing business activities (Katila and Ahuja, 2002; O’Reilly and Tushman, 2004). Although previous research has suggested that organizations need to combine structural differentiation and integration mechanisms to create loosely coupled systems (cf. Smith and Tushman 2005; Westerman et al., 2006; Gilbert, 2006), the joint effects of both structural attributes on corporate venturing have remained unclear. Moreover, these studies are either conceptual or case studies. With this paper we study the effects of combinations of differentiation and integration mechanisms on corporate venturing by means of a large sample.

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