• Initial focus on identifying the contexts of potential acquisitions, seeking to identify variation in uncertainty and controversy (the independent variables), before turning to selecting cases and then identifying valuation methods (the dependent variables).|
• Extensive discussions with the chaebol of the relevance of the ideas and implications.
○ Discussions with the think tank at the chaebol of potentially relevant contextual factors reinforced the importance of uncertainty and controversy (the primary role of the think tank is in-housing consulting, together with responsibilities for macroeconomic forecasts, organizational culture, and semi academic research).
○ Follow-up interactions with former key interviewees.
○ Circulation of our reports to the key interviewees and other managers.
○ Ex post presentation at the chaebol’s corporate strategy and planning team, as well as internal and external experts.
|Non-random choice of interviewees, obtrusive observation||
• Identified a wide range of knowledgeable executives based on personal contracts, follow on suggestions from initial respondents, suggestions from investor relations managers, and executives identified in media articles.|
• Discussions with external experts, including industry analysts and academic scholars in Korea.
• Crosschecking of interviewees’ comments with archival and media information.
|Ex post rationalization and recall bias||
• Cross-checking through archival information and media articles; we chose visible deals for which substantial information is available.|
• Extensive discussions with the chaebol of the accuracy of the information, plus discussions with the strategy and planning team, an in-house M&A expert, and external experts.
• Crosscheck our interpretation through discussions with executives and analysts.|
• Develop logical model of cognitive processes and integration with the data.
• Ex post interviews and presentation at the chaebol to identify other factors that influence choice of valuation methods, either directly or by shaping uncertainty and controversy. Deal size, time limits, and habitual methods are possible factors. Size can affect either controversy or uncertainty depending on cases. Time limits are related with the perceived amount of uncertainty at the moment of valuation, which is our focal analysis subject. Uncertainty and controversy can explain the origin of valuation habits and routines.|
• Although it is impossible to identify all confounding factors and to analyze their influences in any study, this creates opportunities for future research.
|Data censoring/internal validity issues||
• Most cases (7 of 10) were executed, including at least one case in each combination of uncertainty and controversy.|
• Balance of complete and incomplete deal to check whether results remain robust.
• Interviewees are high-level executives, with careers in different affiliates and divisions, who have a corporate-level perspective on the deals.|
• Affiliates coordinate with each other through formal and informal networks (legally informal, although regarded as standard [i.e., formal] in the firm). Every M&A deal is reviewed by the de facto headquarters (“central office”) of the chaebol, which reduces affiliate-level heterogeneity.
• Affiliates share similar document formats and approval processes, producing (and reflecting) common organizational culture and routines.
|Non-independence of controversy and uncertainty||• Discussed in the text, within “Empirical Issues in Stage 1”|