...E-GOST TSER Contract of the European Union HPSE-CT-2002-50026 (Thematic Network) 1st workshop : April 3rd –4th, 2003 (Strasbourg) RESOURCES AND COMPETENCES PERSPECTIVES ON STRATEGY OF THE FIRM: A discussion of the central arguments F. Amesse, A. Avadikyan, P. Cohendet Introduction: In 1994, Wernerfelt received an award for the best paper of the decade in Strategic Management Review (A resource-based view of the firm, 1984). Considering the fortune of the article among practicing managers (Wernerfelt, 1995), he admitted that such a fortune had been leveraged by the 1990 article of Prahalad and Hamel in Harvard Business Review (“The Core Competence of the Corporation”). Directly addressed to people in management and strategy, this article was clearly prescriptive as to the best way to set winning strategies for the firm, especially as to diversification and the abusive use of SBUs (Strategic Business Units) in highly decentralized profit centres. “In the 1990s, top executives will be judged on their ability to identify, cultivate, and exploit the core competencies that make growth possible”. Since the 1990s, the resource based view (RBV) and the core competence approach (CCA) became very attractive for many researchers and consultants. Such interest was well supported by what seemed to be a clear and superior way of setting strategies by large Japanese groups which frequently served as a benchmark case of core competence management. The strong and pervasive trends...
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...its objectives. Strategic management as a professional field and discipline originated during the period of the half twentieth century, the 1950s with Igor Ansoff, Michael porter, Alfred Chandler and Henry Mintzeberg as the one of the main contributors in the development of the field of strategic management . During the 1950s, after the Second World War, academicians, researchers and practitioners basically paid very little attention to the practical concepts of strategy developed and embraced during the war. After normalcy and stability was achieved most business persons and investors started focusing and laying more emphasis on efficient and effective production in order to restore what was lost during the war. Consequently, production firms and organizations moved and shifted from an emphasis on operations, budgeting and controlling areas to more emphasis on planning aspects (Freeman, 2010). This arose as result of the dynamic environment that businesses were operating in and the urgent need for solutions which eventually demanded future planning taken at a larger perspective and view. This led to many businesses requiring the urgent need of having a corporate policy. With these, the seminar work of Chandler of 1962 placed and positioned the concept of strategy as a unique business function from marketing, sales, finance and production. In this case strategy was defined to comprise and involve planning on the long term goals of an organization (Freeman, 2010). It can be noted...
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...Procurement is An Integral Part of Resource- Based View of An Organization Phuong Duong University College Dublin (12251697) 4112 words ABSTRACT Procurement has become an increasingly widespread practice among organizations and is today of strategic importance that attract great interest from scholars in the literature. The primary purpose of the paper is to contribute with a review of leading studies that analyze procurement from the resource-‐based view of the organization. The paper begins by setting out the business environment of procurement and then presents the development and propensity of procurement. This is followed by a review of principal works and differences of perspectives of resource-‐based view. The next section contains an analysis of the relationship between procurement and resource-‐based theory and discusses empirical works on outsourcing...
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...categories: country-based theories and firm-based theories. Country-based theories view business in a macro perspective from a point a view of a nation and focus on trading phenomenon particularly in exports and imports. While firm-based theories are modern theories that emerged after the Second World War as it views business in a micro perspective from the angle of a firm. Despite the different perspectives of firm-based theories and country-based theories, they are interlinked and complement each other. The firm-based theories were developed from classic country-based theories and supported with empirical research. Country-based theories are international business theories that argue on the evolvement of business since the 16th century. The theories are classical theories that derived from an economic perspective. There are 4 theories involved in country-based theories. They are Mercantilism Theory, Absolute Advantage Theory, Comparative Advantage Theory and Heckscher-Ohlin Theory. Firm-based theories attempt to explain business phenomena related to international trade. Mercantilism theory was the first theory of international business that emerged in England in the mid of 16th century. The principal affirmation of the theory was its gold and silver were the mainstays of national wealth and essential to dynamic business. It was a political economy system that aimed to generate wealth by limiting imports and encouraging exports. Under this theory, the economic growth...
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...Service Firms: A Resource-Based Approach Mohammadreza Asgari*, Mohd Nazari Ismail**, Syed Zamberi Ahmad*** Faculty of Business and Accountancy, University of Malaya, Kuala Lumpur ABSTRACT The rapid progress in services has attracted scholars to study the behaviour and decisions of service firms. Firms from Malaysia, as a developing country, with a fast growing economy that increasingly relies on services have shown a remarkable expansion into foreign markets, which has resulted in high foreign direct investment (FDI) outward inflows and increasing exports of services. This paper utilizes the resource-based theory, in which the main determinants of the choice of entry mode are organizational variables compared to environmental factors, to explain the choice of entry strategies made by Malaysian service firms and the motives for it. This study aims to develop a framework for the choice of entry mode strategies that has fewer shortages than others, analyze the determinants of entry mode strategy in order to find the similarities and differences existing between firms in the decision-making process for the choice of entry mode, and consider the role of psychic distance in adopting an appropriate strategy in different markets. Suggestions for future research are also presented. Keywords: Entry mode strategy, developing country, Malaysia, service industries, multinational corporations INTRODUCTION Because of the fast globalization of business since the 1980s, many firms have developed...
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...Strategic Marketing and the Resource Based View of the Firm Strategic Marketing and the Resource Based View of the Firm John Fahy University of Limerick Alan Smithee Alloa Metropolitian University John Fahy is Professor of Marketing, Dept. of Management & Marketing, University of Limerick, Limerick, Ireland 353-61-213126 (office), 353-61-338171 (fax) John.Fahy@ul.ie. Alan Smithee is Senior Lecturer in Marketing, Alloa Metropolitian University, Alloa, Scotland. Please address all correspondence to the first author. EXECUTIVE SUMMARY The resource-based view of the firm (RBV) is one of the latest strategic management concepts to be enthusiastically embraced by marketing scholars. This paper argues that the RBV holds much promise as a framework for understanding strategic marketing issues but cautions that, before it is adopted, it needs to be fully understood. Consequently, the paper charts the development of the RBV from its origins in early economic models of imperfect competition, through the work of evolutionary economists to the contributions of strategy and marketing scholars over the past two decades. This broad literature base has given rise to a great deal of ambiguity, inconsistent use of nomenclature and several overlapping classification schema. The paper seeks to draw together common themes of firm heterogeneity, barriers to duplication, sustainable competitive advantage and Ricardian rents within an overall model of resource-based competitive advantage. The second...
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...of “Organization Theory” much information from different perspectives was presented about the issues how the literature defines a firm, how a firm can operate most efficiently and what has to be considered to generate sustainable success. For me personally the topic “resourced-based view of a company” was the most interesting one. Therefore, I was wondering if it is possible to apply a resource-based view as an innovative perspective to support the strategic decision making process of certain management sections. During this research proposal I am going to present my research strategy to answer this question. 2. Literature Review In order to prove the value of the research question a review of the relevant literature was undertaken. Obviously, the central element of my research question is “the resource-based view” (RBV). Therefore, I disclose which initial assumptions, approaches and results have been evolved about the RBV thematic in literature. The findings about the development of the concept are introduced chronologically. Moreover, a dissertation about a closely related topic to my research question is presented. As for every major business concept, there exist countless definitions about the RBV. A concise and covering one might be: “A management device used to assess the available amount of a business' strategic assets. In essence, the resource-based view is based on the idea that the effective and efficient application of all useful resources that the company...
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...Ed van Sluijs & Frits Kluytmans MERIT Open University This article is based on a journey through the wilderness of strategic human resource management. Part 1 gives an overview of the recent literature on this topic, particularly pertaining to the two issues which received have most attention until now: the relational aspects and the content aspects. In part 2, we go deeper into the wilderness and explore the least known aspect of strategic human resource management, namely the process aspects. This exploration is based on the simultaneous study of the (scarce) literature and four cases. Finally, the connection between the three aspects is investigated. INTRODUCTION Increased integration between human resource management and business strategy is one of the most important demands that are placed upon modern strategic human resource management. In both the management and the academic literature, it is generally acknowledged that the strategic deployment and management of personnel can contribute to the success and continuity of the firm. Some go even further by stating that a firm’s human resources form the basis of the firm’s competitive advantage. In this view, the human resources are the most important assets of an organisation. At the same time, in addition to the importance of the human resources as such, it is believed to be important that the management of the human resources should be in perfect fit with the management of the organisation as a whole and...
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...Norges Handelshøyskole Bergen, Spring 2011 Master Thesis within the main profile of International Business Thesis Advisor: Professor Svein Ulset Title: International Modes of Entry Subtitle: The Case of Disney By, Carlos Gonzalez Hernandez This thesis was written as a part of the master program at NHH. Neither the institution, the supervisor, nor the censors are -through the approval of this thesis- responsible for neither the theories and methods used, nor results and conclusions drawn in this work. International Modes of Entry: The Case of Disney 1 Abstract The case of Disney’s theme parks represents an opportunity to test major internationalisation theories in a setting of large investments with little chance for reversal of commitments. The purpose of the research is to study the benefit of different entry modes dependent on Disney’s Theme Parks value-generating resources and capabilities while conditioned to certain local industrial and institutional conditions in foreign markets. Five major theories and frameworks were used to analyze all four Disney’s ventures abroad. This resulted in 20 individual hypotheses analyzed. Results indicate that Disney followed a predictable internationalisation process in the cases of Tokyo, Hong Kong and Shanghai, but that it went off-path in the Paris one. In successful cases Disney followed a cautious approach, involving local partners to transfer and adapt the “Disney Experience”. In the case of Paris the company decided to enter...
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...Evaluating Firm Strengths and Weaknesses What Does Internal Analysis Tell Us? Internal analysis provides a comparative look at a firm’s capabilities • what are the firm’s strengths? • what are the firm’s weaknesses? • how do these strengths & weaknesses compare to competitors? Why Does Internal Analysis Matter? Internal analysis helps a firm: • determine if its resources and capabilities are likely sources of competitive advantage • establish strategies that will exploit any sources of competitive advantage Traditional research on firm strengths and weaknesses • Theories of distinctive competence – General managers as distinctive competencies – Institutional leadership as a distinctive competence • Ricardian economics • Penrose’s theory of firm growth Research on the skills of general managers, institutional leaders, economic rents and firm growth have been brought together to develop a rigorous model to analyze a firm’s strengths and weaknesses: the resource-based view of the firm The Theory Behind Internal Analysis The Resource-Based View • developed to answer the question: Why do some firms achieve better economic performance than others? • used to help firms achieve competitive advantage and superior economic performance • assumes that a firm’s resources and capabilities are the primary drivers of competitive advantage and economic performance The Resource-Based View Resources and Capabilities Resources: • tangible and intangible assets of a firm » tangible:...
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...Business Strategy and Human Resource Management: Setting the Scene Ed van Sluijs & Frits Kluytmans MERIT Open University This article is based on a journey through the wilderness of strategic human resource management. Part 1 gives an overview of the recent literature on this topic, particularly pertaining to the two issues which received have most attention until now: the relational aspects and the content aspects. In part 2, we go deeper into the wilderness and explore the least known aspect of strategic human resource management, namely the process aspects. This exploration is based on the simultaneous study of the (scarce) literature and four cases. Finally, the connection between the three aspects is investigated. INTRODUCTION Increased integration between human resource management and business strategy is one of the most important demands that are placed upon modern strategic human resource management. In both the management and the academic literature, it is generally acknowledged that the strategic deployment and management of personnel can contribute to the success and continuity of the firm. Some go even further by stating that a firm’s human resources form the basis of the firm’s competitive advantage. In this view, the human resources are the most important assets of an organisation. At the same time, in addition to the importance of the human resources as such, it is believed to be important that the management of the human resources should be in perfect fit with...
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...November, 2012, London.UK. Network-based theories and internationalization of firms: applications to empirical studies Mojtaba Hosseini and Hosseini Dadfar Linkoping University, Sweden Key Words Network based theories, Internationalization, Revised Uppsala Model, ARA-Model, and Network Embeddedness. Abstract By using a topology of the most frequently used network-based theories on the firms’ internationalization; this paper is going to present some recommendations to correctly apply those theories in future internationalization studies. We have identified eight network-based theories that are broadly used in internationalization studies. These theories are Relationship Approach, Social Network Analysis and Network Mapping in American schools, and Industrial Marketing and Purchasing Group (IMP) Interaction Approach, ARA-Model, Network Embeddedness, Revised Uppsala Model and Network-based Internationalization Theory, which are developed by European universities. This paper, will explain these theories, their applications to internationalization and then making some recommendations for the future empirical studies. Figures and tables are used to clarify and summarize the theories and their empirical applications. Introduction Researchers have been using of different basic theories to explain the internationalization of companies. For example, transaction cost approach (TCA) (Anderson 1986; Lee, Koh, and Heo 2011), resource-based view (RBV) (Mariz-Pérez and García-Álvarez...
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...Week 1: The economic foundations of theories in strategy Corporate strategy; where to compete, portfolio, parent level Competitive strategy; how to compete, SBU, competitive advantage Three layers of theory: management – strategic management – economies Paradox: how is it possible to have a general statement about uniqueness? We try to have general statements about uniqueness. Theory=general statement about cause and effect Stoelhorst, J.W. (2008), Thinking about Strategy Stoelhorst: 5 Schools of thought about strategy • Prescriptive schools: ○ 1960s: Design school (strategy formulation) ○ 1970s: Planning school (strategy formulation) ○ 1980s: Positioning school (strategic analysis) ○ 1990s: Resource-based school (strategic analysis) • Descriptive school: ○ 1980s onwards: Process school Design school: Strategy formulation is a process of conception The CEO formulates a clear, simple, and unique strategy (business policy) through a deliberate process of conscious thought. There should be a fit between a firm’s strengths and weaknesses and external opportunities and threats (SWOT analysis). Strategy formulation and implementation are clearly separate activities. Planning school: Strategy formulation is a formal process ...
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...mid-eighties witnessed the emergence of a growing body of work collectively labelled the resource and capability-based view of the firm (RBV). In reality, Resource Competence View (RCV) first adopted an “economic” orientation. Pioneer studies (Wernerfelt, 1984) , Barney, 1986, 1991, Dierickx and Cool, 1989, Peteraf, 1993) focused on the type of resources and competencies that could offer to its owner a sustainable competitive advantage. Therefore, resources and competencies approach first appeared as a theory of competitive advantage or a theory of “performance of the firm” (Argyres & Zenger, 2007). It is only recently, in the last 20 years that organizations have started using the resource based view approach on strategy. Nowadays, they view it as the most important key development in international business research and strategic management, an approach that gives a coherent vision based on a firm's capabilities to help determine the strategic resources necessary for the firm's survival and growth within a particular market place. As Hitt et al (2001) stated, “the resource based model assumes that each organization is a collection of unique resources and capabilities that provides the basis for its strategy and that is the primary source of return.”. It suggests that in order for a firm to sustain competitive advantage, it must not only have resources and capabilities but also have a firm control over it and they must meet certain basic criteria such as being: valuable, rare...
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...independent companies. As large companies have pulled back their collaboration boarders through outsourcing and divestment of ‘non-core’ activities, they have increasingly cooperated with other companies in order to engage in activities and access resources outside their own boundaries. The concept of strategic alliances has become widely used in the business language to refer to the types of partnerships agreements between two or more companies that pursue a clear strategic collaboration objective, with different levels of possible integration among the members. In today’s competitive global economy strategic alliances are a crucial option for achievement of competitive advantage. By developing strategic alliances, organisations can share their excess or complementary resources and capabilities so as to strengthen their position in the market and gain competitive advantage. When such alliances are effectively and efficiently managed the partnering firms can gain immensely towards mutual profitability. In any cooperative relationship trust is key for success. Where mutual trust and synergies exists, partnering organisations can benefit substantially from opportunities that can be exploited through maximum utilization of combined resources. On the other hand, where there is no trust, extensive monitoring systems become necessary to monitor each partners’ contribution and this results in increased cost of operations that ultimately hamper the competitiveness of the alliance. Definition ...
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