PhD Seminar Series: Star-stacking? The strategic choice to engage with multiple rankings

Star-stacking? The strategic choice to engage with multiple rankings

Speaker: Clara Depalma

Abstract: Organizations are increasingly rated, ranked, certified, and otherwise subject to many forms of evaluations, each relying on distinct and potentially conflicting criteria. Engaging with any of these evaluations is however not an inevitable choice, but a strategic decision with potentially far-reaching implications. In this paper we study this strategic decision inductively, by examining organizational responses to the introduction of the Green Star—an award recognizing sustainability, by the Michelin Guide, an influential evaluator that has been traditionally assigning Red Stars for culinary excellence. We combine qualitative insights from 53 interviews with chefs and restaurant owners with the analysis of longitudinal data on menus and websites for 371 Michelin-starred restaurants to investigate why some high-status restaurants actively pursued the new evaluation while others refrained. Our findings suggest that engagement with a new evaluation is a strategic decision shaped by trade-offs between potential gains from recognition and palpable costs associated to reallocating attention and resources. We further show that firms differ systematically in how they approach this decision depending on similarity to prior awardees and insecurity of their status position. We contribute to research one valuations and producer reactivity and advance our understanding of how organizations navigate multiple, externally imposed performance criteria.