Session Details: Session 1069

Leveraging and Repositioning Resources

Track E

Date: Monday, October 13, 2008


Time: 17:00 – 18:15


Room: Salon 17

Session Chair:
Christian Stadler, University of Warwick

Title: Organizational Forgetting In Divestment: Senior Moment Or Stimulus For Post-Divestment Performance?


  • Sven Kunisch, University of St. Gallen

Abstract: Applying the lens of organizational learning, we investigate the role of organizational forgetting in divestments. We propose that forgetting moderates the relationship between divestment and post-divestment performance. Specifically, we infer positive impacts for firms with low levels of accidental forgetting while firms with high levels experience negative impacts. Likewise, we infer positive impacts for high levels of purposeful forgetting while firms with low levels face negative impacts. We argue that purposeful forgetting fosters to free up resources that can be leveraged for creating additional organizational knowledge. Hence, forgetting antecedes new organizational learning and enables firms to do new things or existing things better with the newly configured portfolio. Ultimately, this leads to increased post-divestment performance. We use an organizational forgetting model to analyze the relationship.

Title: Paradise Sold: Identity, Resource Partitioning and Organizational Form in the Organic Farming Industry


  • Katarina Sikavica, University of Munich
  • Jo-Ellen Pozner, Santa Clara University

Abstract: We argue that organic farming is an identity movement whose success has led to changes in its institutional environment. Because the definition of organic is open to interpretation, information asymmetries between consumers and producers leave room for lobbying efforts by generalists hoping to weaken organic standards and redefine the organic label. These changes, in turn, introduce a new competitive dynamic, which forces actors to choose between remaining true to their movement’s ideals and defecting from the movement, resulting in active identity management and the introduction of a hybrid organizational form. We predict that organizations whose identities are less embedded in the organic movement are more likely to defect, and that this relationship will be moderated by the local institutional environment.

Title: Related Diversification As An Exploration Strategy: An In-Depth Historic Case Study of Large European Firms


  • Christian Stadler, University of Warwick

Abstract: According to March (1991) firms need to exploit existing resources to generate rent and explore for new knowledge to compete in the future. More recently, however, the attention was primarily on innovation as a strategy to generate competitive advantage. Based on historical case studies of 9 successful and 9 less successful large European firms we suggest that firms succeeded primarily through leveraging existing resources. They were able to put more emphasis on exploitation as they accumulated the financial means to purchase new knowledge. In other words firms used related diversification as an exploration strategy. This way the balance between exploration and exploitation was not achieved on the firm but on the social system level.

Title: Think Inside the Box: When Should (Not) a Firm Retrench?


  • Dominic S. K. Lim, Western University, Canada
  • Nikhil Celly, HanCelly
  • Eric Morse, University of Western Ontario

Abstract: In this study, we argue that the efficacy of different retrenchment strategies can be different contingent upon the firm’s dominant rent creation logic: Ricardian versus Schumpeterian. Specifically, we hypothesize that the effect of cost retrenchment can be detrimental when the firm’s dominant rent creation mechanism is Schumpeterian, while the effect of asset retrenchment in the same case may be positive. On the other hand, when the firm’s dominant rent creation mechanism is Ricardian, the cost retrenchment should be preferred. Simply put, managers should be careful not to destroy the firm’s rent creation mechanism when they develop turnaround strategies. We test our hypotheses through a series of regression analysis using a sample of 1640 firm-year observations of Japanese firms for the time period of 1970-2000.

All Sessions in Track E...

Sun: 10:00 – 11:30
Session 1501: Exploration Strategies: Current Research and Future Content and Methodological Challenges
Sun: 13:00 – 14:30
Session 1601: Organizational Capabilities and Competitive Advantage: Where Do We Go From Here?
Sun: 15:00 – 16:30
Session 1701: Using Research Centers to Foster ABC Collaboration
Mon: 11:15 – 12:30
Session 1067: The Upside of Financial Investments
Session 1072: Lessons from Industry Cases
Mon: 15:30 – 16:45
Session 1073: Learning and Competitive Dynamics
Session 1074: Configurations and Performance
Session 1076: The Knowledge-Based View in New Arenas
Mon: 17:00 – 18:15
Session 1060: Value Creation and Appropriation: Perspectives From the Resource-Based View, Property Rights and Incomplete Contracting
Session 1062: Mastering Alliance Capability
Session 1069: Leveraging and Repositioning Resources
Tue: 11:15 – 12:30
Session 1059: Networks and Social Capital
Session 1070: Performance and the Competitive Arena
Tue: 14:30 – 15:45
Session 1063: Topics on Competitive Dynamics
Session 1066: Managing and Environmental Stewardship
Session 1075: Strategic Decision Making
Wed: 10:00 – 11:15
Session 1065: Managing Stakeholder Networks and External Communication
Session 1071: Technology, Innovation and Competitive Advantage
Wed: 11:30 – 12:45
Session 1064: Exploring Dynamic Capabilities
Session 1068: Signals and Firm Reputation

Strategic Management Society

Cologne Conference