Kristina Steffenson McElheran
Assistant Professor of Business Administration
Kristina Steffenson McElheran is the Lumry Family Assistant Professor of Business Administration in Technology and Operations Management at the Harvard Business School. Kristina conducts empirical economics-based research on the interactions between information technology, firm performance, and competitive strategy. Her focus is on understanding the drivers and implications of how firms use information technology to collaborate and compete in the marketplace.
Prior to her academic career, Kristina worked for two start-up technology companies in Silicon Valley. The first, Risk Management Solutions, has become a leading provider of products and services for managing risks associated with natural disasters. The second, Exemplary Software, provided collaborative web-based supply chain management solutions.
Kristina’s PhD (2009) in Managerial Economics and Strategy comes from Northwestern University’s Kellogg School of Management. She also holds a Diploma in Economics (1999) from the London School of Economics, as well as a Master's degree (1994) in International Development Policy and a Bachelor's degree (1993) in Political Science from Stanford University.
Delegation in Multi‐Establishment Firms: Adaptation vs. Coordination in I.T. Purchasing Authority
This paper conducts one of the first large-scale, establishment-level empirical studies of delegation within firms. Recent contributions to a rapidly growing theory literature have focused on the tradeoff between adaptation and coordination in determining organizational structure, but empirical evidence is extremely limited. Theoretically, delegation of authority is expected when locally adapted choices are most important to the overall value of the firm, when local information advantages are significant, or when the cost of processing firmwide information at the center grows too great. Centralization is predicted when the value of firmwide coordination dominates these adaptation and information-processing concerns. Based on a novel data set containing information on establishment-level decision rights over information technology investments, I find robust conditional correlations consistent with some, but not all of these predictions. A relatively high economic value of adaptation at the establishment has a strong association with delegation to local managers, as do local information advantages and greater firmwide diversification. In contrast, a high value of within-firm coordination as measured by the value of integrated production is negatively correlated with delegation. Surprisingly, absolute size of the firm is negatively related to delegation. The overall pattern of results highlights the need for a nuanced theoretical framework that can accommodate the full range of empirical facts.
Decentralization versus Centralization in IT Governance: It's Not as Simple as You Might Think
The Short Life of Online Sales Leads
Keywords: Online Technology;
Market Leadership and Strategic Investments in Innovation: The Adoption of E-Business Capabilities
This study focuses on whether more-productive firms are more likely to adopt process innovations and why. The empirical context is the adoption of e-business practices among U.S. manufacturing plants in early 2000. Based on detailed data from the U.S. Census of Manufactures, the empirical results indicate that market leadership is, in general, positively correlated with the use of e-business practices. However, there is an important distinction between e-buying and e-selling. In e-buying, the likelihood of adoption is increasing in both relative productivity and in market share. By contrast in e-selling, only market share has a positive (and noisy) relationship with adoption. Plausible explanations for the difference are explored, centering on tradeoffs between stand-alone vs. strategic motivations for adopting as well as important distinctions between the two technologies.
Motivation and Incentives;
Delegation in Multi-Establishment Firms: Evidence from I.T. Purchasing
Recent contributions to a growing theory literature have focused on the tradeoff between adaptation and coordination in determining delegation within firms. Empirical evidence, however, is limited. Using establishment-level data on decision rights over information technology investments, I find that a high net value of adaptation is strongly associated with delegation, as are local information advantages and firm-wide diversification; in contrast, a high net value of within-firm coordination is correlated with centralization. Variation across establishments within firms is widespread: most firms are neither fully centralized nor fully decentralized. Delegation patterns are largely consistent with standard team-theory predictions; however, certain findings, such as a negative correlation between delegation and firm size, call for a consideration of agency costs, as well.
Keywords: Business Units;
Decision Choices and Conditions;
Power and Influence;
Information Technology and Boundary of the Firm: Evidence from Plant-Level Data
We study the relationship between different margins of information technology (IT) use and vertical integration using plant-level data from the U.S. Census of Manufactures. Focusing on the short-run decision of whether to allocate production output to downstream plants within the same firm or to external customers, we find that customer-focused IT, by itself, has surprisingly little impact. In contrast, adoption of upstream supplier-focused IT at a plant is associated with a significant decline in downstream vertical integration. However, the greatest decline in within-firm transfers occurs when supplier- and customer-facing IT are adopted together, suggesting the presence of complementarities in supply chain technology adoption. These results are consistent with the view that, by reducing external coordination costs, IT investments promote a decline in plant-level vertical integration, but only when those investments are made jointly with both suppliers and customers. Our results provide less support for the view that IT investments led to a decline in vertical integration by lowering transactions risks.
Keywords: Information Technology;
Factories, Labs, and Plants;
Do Market Leaders Lead in Business Process Innovation? The Case(s) of E-Business Adoption
This paper explores the relationship between market position and business process innovation. Prior research has focused on the alignment between new technologies and the internal capabilities of firms to pursue them. I extend the investigation to include external capabilities as well. I develop a framework for predicting whether market leaders will undertake business process innovation based on the complexity of the process, the firm's organizational structure, and the innovation's impact on customers. I test its predictions in the context of e-business adoption using a large multi-industry data set. Robust conditional correlations suggest that market leaders were more likely to adopt new e-business practices only in settings that required little customer investment or where customer capabilities were well aligned with the new technology. Otherwise, leaders' adoption was significantly lower than that of their less-prominent competitors. The findings highlight the strategic significance of adjustment costs in technology adoption, both within and beyond the firm boundary.
Motivation and Incentives;