Impact of ownership change on plant practice-performance dynamics

Abstract

Purpose – Ownership change has been an overlooked contingency factor in past plant level practice-performance studies. Therefore, the purpose of this paper is to examine the impact of ownership changes to practice-performance dynamics by longitudinally following the same 23 manufacturing sites from year 1993 to 2010. Design/methodology/approach – Interview data of the made in Finland – study are used for presenting different paths of plant development in the long term. Both narratives and descriptive statistics are used to support the analysis. Findings – The findings suggest that the benefits of long-term domestic ownership may in fact exceed the positive knowledge spill-over effects that derive from foreign acquisitions. Foreign acquirers seem to “cherry-pick” well-performing sites. Also it seems that the likelihood of inferior performance and plant shutdowns may increase due to foreign acquisitions. Research limitations/implications – Due to the exploratory nature of the study the sample size did not allow for testing statistical significance of the results. Originality/value – The exploratory findings of the study open new avenues of theory development for practice-performance studies, and corroborate research in other disciplines such as economics and corporate governance.