Our computer-aided textual analysis algorithm investigates a company’s attitudes. A company’s attitudes also determine its future readiness. The algorithm (app) analyses many public news sources from the last decade.
Our tailored app communicates with over 60 international media sources through an API (Application Programming Interface). The app downloads tens of thousands of news articles. It focuses on those articles that have the company as their chief topic. We then track the frequency when certain words and phrases appear. Academic, peer-reviewed papers previously validated these terms. By doing so, we can measure how much companies follow certain psychological constructs. The app can answer important questions on companies’ behaviors, for example,
- Which companies are more proactive learners?
- Which companies do rather exploit near term opportunities as opposed to explore capabilities that have less immediate pay off?
- Which companies are more committed to embracing digital trends?
This approach follows a long history of research from the academic management literature. We compare the scores between companies in each calendar quarter. This is to ensure a fair baseline as companies face the similar circumstances at the same point in time.
Companies which are focused on exploring “identify new opportunities” and follow “processes of concerted variation, planned experimentation, and play”. These companies focus their innovation activities on “technological innovation aimed at entering new product-market domains” (Uotila et al., 2009; Allison, McKenny, & Short, 2014; March, 1991; Raisch & Birkinshaw, 2008; Baum, Li, and Usher, 2000; Gupta, Smith, and Shalley, 2006). Exploring is the opposing construct to exploiting.
Companies high in exploration are often mentioned in connection with words like searching, variation, exploration, risk-seeking, experimentation, playing, flexibility, discover, etc. This also includes variations of the words, like the corresponding nouns.
Some management scholars have investigated how exploration relates to other of our constructs in textual analysis. For instance, Kammerlander et al. (2014) suggests positive correlation between exploration & promotion. Similarly, Tuncdogan, Van den Bosch, and Volberda (2015) explain that exploration is more correlated with promotion than exploration is with prevention.
Companies which focus on exploiting “seize existing opportunities”, and focus on processes of “local search, experiential refinement, and selection and reuse of existing routines”. These companies’ activity focuses on “improving existing product-market domains” (Uotila et al., 2009; Allison, McKenny, & Short, 2014; March, 1991; Raisch & Birkinshaw, 2008; Baum, Li, and Usher, 2000; Gupta, Smith, and Shalley, 2006). Exploiting is the opposing construct to exploring.
Companies high in exploitation are often mentioned in connection with words like refining, choosing, exploiting, production, efficiency, selection, implementation, execution, etc. This also includes variations of the words, like the corresponding nouns.
Which type of scholarly literature investigates exploitation?
The most prominent literature that focuses on exploitation discusses the so-called exploration-exploitation dilemma, which states that companies struggle to face an inherent trade-off of exploitation and exploration. As such, only “ambidextrous” organizations, which are rare, manage to overcome that hurdle (O’Reilly & Tushman: The ambidextrous organization, 2004; O’Reilly & Tushman: Ambidexterity as a dynamic capability, 2008)
Learning orientation is a behavior derived from the literature on organizational learning and describes the motivation, ability, and executional quality of learning in an organization. Learning orientation concerns the whole organization and not only individuals. It also measures the dissemination of the relevant organizational knowledge throughout the organization.
Companies high in learning orientation are often mentioned in connection with words like analyse, evaluate, discuss, exchange, fail, identify, interpret, induce, infer, learn. This also includes variations of the words, like the corresponding nouns.
Many management scholars have researched organizational learning orientation. For example, Calantone, Cavusgil, and Zhao (2002) investigated the link between learning orientation, firm innovation capability, and firm performance. They find that learning orientation is a key factor to organizational competitive advantage. Further, Sujan, Harish, Weitz, and Kumar (1994) find that learning orientation is important for effective marketing and sales staff. Finally, Baker and Sinkula (1999) suggest that learning orientation and market orientation contribute to good organizational performance.
Digital orientation is an organization’s guiding principle to pursue digital technology-enabled opportunities to achieve competitive advantage. It encompasses the dimensions of digital technology scope, digital capabilities, digital ecosystem coordination, and digital architecture configuration.
Companies high in digital orientation are often mentioned in connection with words from the four dimensions mentioned above. These include algorithm, compute, API, developer, digital, functionality, IoT, open source, virtual, etc. This also includes variations of the words, like the corresponding nouns.
Our conceptualization and use of digital orientation stems from Kindermann et al. (2020), who are the first scholars to propose a digital dictionary for automated textual analysis. These scholars conceptualize digital orientation as a distinct type of strategic orientation, i.e., an orientation which “reflects the firm’s philosophy of how to conduct business through a deeply rooted set of values and beliefs that guides the firm’s attempt to achieve superior performance (Gatignon & Xuereb, 1997)”.