Identifying internal markets for resource redeployment
成果类型：
Article
署名作者：
Dickler, Teresa A.; Folta, Timothy B.
署名单位：
IE University; University of Connecticut
刊物名称：
STRATEGIC MANAGEMENT JOURNAL
ISSN/ISSBN：
0143-2095
DOI：
10.1002/smj.3205
发表日期：
2020
页码：
2341-2371
关键词：
corporate strategy
demand opportunities
multi-business firms
resource redeployment
RESOURCE-BASED THEORY
摘要：
Research summary This article explores one important way in which multi-business firms have advantages over single-business firms. By having flexibility to reallocate resources, such as human capital, production capacity, or equipment, between businesses in their portfolio, they may be able to efficiently expand in markets with strong opportunities and contract in less attractive markets. We provide empirical evidence confirming that compared to single-business firms in the same industry and of the same size, businesses in multi-business firms expand revenues 12% more aggressively, and retrench revenues 37% more aggressively, on average. This first generalizable test of the theory also reveals that the relative advantage of multi-business firms escalates with lower internal resource adjustment costs, higher external transaction costs, and greater opportunity differences with the portfolio. Managerial summary In this article, we show an important way in which multi-business firms have advantages over single-business firms. By having flexibility to reallocate resources, such as employees, production capacity, or equipment, between businesses in their portfolio, they may be able to efficiently expand in markets with strong opportunities and contract in less attractive markets. We provide empirical evidence confirming that compared to similar single-business firms in the same industry and of the same size, businesses in multi-business firms expand revenues 12% more aggressively, and retrench revenues 37% more aggressively, on average. The article also provides theoretical predictions about when the advantage is most pronounced.
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