The three laws of business combinations: how to create value by remixing assets

Abstract

Purpose

The author defines and discusses the three laws of business combinations that are essential to a profitable use of resources.

Design/methodology/approach

The author shows how applying these laws is necessary for success.

Findings

All business combinations must have the potential to create joint value, must be governed to realize this value, and must share value in a way that provides a reward to each party’s investment

Practical implications

In remix strategy, the fundamental unit of analysis is the combination of resources that yields value. That combination competes with other combinations. Some combinations will gain advantage over others because they encompass just the right resources; others will gain advantage because they manage their collective resources better than others do.

Originality/value

The author’s insight is that instead seeing competition as a battle of firm vs. firm, practitioners need to understand how bundles of resources compete, regardless of whether they are organized as firms.

Citation

Gomes-Casseres, B. (2015), "The three laws of business combinations: how to create value by remixing assets", Strategy & Leadership, Vol. 43 No. 5, pp. 18-23. https://doi.org/10.1108/SL-06-2015-0053