Relational Contracts and Organizational Capabilities
A large literature identifies unique organizational capabilities as a potent source of competitive advantage, yet our knowledge of why capabilities fail to diffuse more rapidly—particularly in situations in which competitors apparently have strong incentives to adopt them and a well-developed unders...
| Main Authors: | , |
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| Other Authors: | |
| Format: | Article |
| Language: | en_US |
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Institute for Operations Research and the Management Sciences (INFORMS)
2012
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| Online Access: | http://hdl.handle.net/1721.1/75010 https://orcid.org/0000-0001-6765-3039 |
| _version_ | 1826205408316882944 |
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| author | Gibbons, Robert S. Henderson, Rebecca |
| author2 | Sloan School of Management |
| author_facet | Sloan School of Management Gibbons, Robert S. Henderson, Rebecca |
| author_sort | Gibbons, Robert S. |
| collection | MIT |
| description | A large literature identifies unique organizational capabilities as a potent source of competitive advantage, yet our knowledge of why capabilities fail to diffuse more rapidly—particularly in situations in which competitors apparently have strong incentives to adopt them and a well-developed understanding of how they work—remains incomplete. In this paper we suggest that competitively significant capabilities often rest on managerial practices that in turn rely on relational contracts (i.e., informal agreements sustained by the shadow of the future). We argue that one of the reasons these practices may be difficult to copy is that effective relational contracts must solve the twin problems of credibility and clarity and that although credibility might, in principle, be instantly acquired, clarity may take time to develop and may interact with credibility in complex ways so that relational contracts may often be difficult to build. |
| first_indexed | 2024-09-23T13:12:30Z |
| format | Article |
| id | mit-1721.1/75010 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T13:12:30Z |
| publishDate | 2012 |
| publisher | Institute for Operations Research and the Management Sciences (INFORMS) |
| record_format | dspace |
| spelling | mit-1721.1/750102022-10-01T13:45:29Z Relational Contracts and Organizational Capabilities Gibbons, Robert S. Henderson, Rebecca Sloan School of Management Gibbons, Robert S. A large literature identifies unique organizational capabilities as a potent source of competitive advantage, yet our knowledge of why capabilities fail to diffuse more rapidly—particularly in situations in which competitors apparently have strong incentives to adopt them and a well-developed understanding of how they work—remains incomplete. In this paper we suggest that competitively significant capabilities often rest on managerial practices that in turn rely on relational contracts (i.e., informal agreements sustained by the shadow of the future). We argue that one of the reasons these practices may be difficult to copy is that effective relational contracts must solve the twin problems of credibility and clarity and that although credibility might, in principle, be instantly acquired, clarity may take time to develop and may interact with credibility in complex ways so that relational contracts may often be difficult to build. 2012-11-26T17:36:46Z 2012-11-26T17:36:46Z 2011-12 Article http://purl.org/eprint/type/JournalArticle 1047-7039 1526-5455 http://hdl.handle.net/1721.1/75010 Gibbons, R., and R. Henderson. “Relational Contracts and Organizational Capabilities.” Organization Science 23.5 (2011): 1350–1364. https://orcid.org/0000-0001-6765-3039 en_US http://dx.doi.org/ 10.1287/orsc.1110.0715 Organization Science Creative Commons Attribution-Noncommercial-Share Alike 3.0 http://creativecommons.org/licenses/by-nc-sa/3.0/ application/pdf Institute for Operations Research and the Management Sciences (INFORMS) MIT web domain |
| spellingShingle | Gibbons, Robert S. Henderson, Rebecca Relational Contracts and Organizational Capabilities |
| title | Relational Contracts and Organizational Capabilities |
| title_full | Relational Contracts and Organizational Capabilities |
| title_fullStr | Relational Contracts and Organizational Capabilities |
| title_full_unstemmed | Relational Contracts and Organizational Capabilities |
| title_short | Relational Contracts and Organizational Capabilities |
| title_sort | relational contracts and organizational capabilities |
| url | http://hdl.handle.net/1721.1/75010 https://orcid.org/0000-0001-6765-3039 |
| work_keys_str_mv | AT gibbonsroberts relationalcontractsandorganizationalcapabilities AT hendersonrebecca relationalcontractsandorganizationalcapabilities |