Seminar – Going beyond optimal distinctiveness: A machine learning approach to strategic positioning for gaining an audience composition premium

Eric Zhao, Associate Professor, Indiana University

A core question in strategy research is how firms should position themselves to gain favourable audience evaluations. Emphasising the heterogeneity in audience predispositions, we propose that firms can gain an audience composition premium by strategically positioning themselves to gain more (less) attention from audiences with positive (negative) predispositions toward them. We argue that this approach to strategic positioning is more conducive for firms with high dispersion in their audience predispositions, and that firms can increase their ability to gain an audience composition premium by engaging with audiences holding moderately diverse evaluative schemas. We employ recommender systems and topic modelling to analyse 152,312 firm-analyst-year observations from 1997 to 2018 and 297,931 earnings call transcripts of US public firms and find strong support for our predictions.

Speaker bio

Eric Zhao is a tenured Associate Professor of Strategy and Entrepreneurship and the IECE Faculty Fellow at the Kelley School of Business, Indiana University. Eric’s research is cross-disciplinary in nature and sits at the intersection of strategic management, organisation theory, and entrepreneurship. His 2017 SMJ article “Optimal Distinctiveness: Broadening the Interface between Institutional Theory and Strategic Management” and his solo-authored book Optimal Distinctiveness: A New Agenda for the Study of Competitive Positioning of Organizations and Markets are widely regarded as foundational contributions to the burgeoning literature on optimal distinctiveness. His second stream of research focuses on how societal-level institutions, such as patriarchy, racial and ethnic segregation, religious diversity, and social class, shape entrepreneurial actions and performance, with broader implications for organisations’ role in addressing grand social challenges.

Eric’s research has been published in leading management and entrepreneurship journals and has accumulated more than 2,300 citations. He is devoted to an ongoing effort to bridge conversations between strategy, organisation theory, and entrepreneurship scholars. Eric won the Academy of Management Emerging Scholar Award in Entrepreneurship in 2019 and the Strategic Management Society Emerging Scholar Award in 2022, making him the first scholar who has been recognised by top early career awards in both strategy and entrepreneurship.

For more information, please contact Luke Slater.