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Article
Publication date: 9 October 2017

Anders Pehrsson

The study draws on the resource-based view and the contingency view of strategy. The purpose of this paper is to contribute to international strategy literature by extending the…

Abstract

Purpose

The study draws on the resource-based view and the contingency view of strategy. The purpose of this paper is to contribute to international strategy literature by extending the current understanding of foreign subsidiary’s competitive strategy in terms of cost leadership and product differentiation.

Design/methodology/approach

Hypotheses concern associations between corporate support building on product and skills relatedness and subsidiary strategies. Also, it is hypothesized that strategies are due to the type of local competitive intensity. The hypotheses were tested on wholly owned subsidiaries of Swedish industrial firms in Germany, the UK and the USA.

Findings

Product and skills relatedness between the subsidiary and the corporate core unit are positively associated with the subsidiary’s emphasis on cost leadership. Also, a positive association was found between skills relatedness and product differentiation, and extensive competitive intensity strengthens the relationship.

Research limitations/implications

The study specifies what business relatedness is needed for a subsidiary’s competitive strategy; skills relatedness is more important than product relatedness; the type of local competitive intensity is important; corporate support and local strategy operate simultaneously.

Practical implications

Management is advised to implement a foreign subsidiary’s competitive strategy by recognizing the mechanisms identified in this study.

Originality/value

In a unique way, the study captures the role of corporate support of a foreign subsidiary’s competitive strategy relying on business relatedness and the importance of aligning the strategy with competitive intensity.

Details

European Business Review, vol. 29 no. 6
Type: Research Article
ISSN: 0955-534X

Keywords

Article
Publication date: 11 March 2019

Anders Pehrsson

Business relatedness is important in international diversification because it enables a firm’s transfer of resources to business units operating in foreign markets. The purpose of…

Abstract

Purpose

Business relatedness is important in international diversification because it enables a firm’s transfer of resources to business units operating in foreign markets. The purpose of this paper is to develop a conceptual model based on a review of the major contributions of studies regarding the relatedness of subsidiaries, joint ventures or any other foreign unit.

Design/methodology/approach

The paper examines theory bases, the relatedness construct, data issues and the key achievements of previous studies. Drawing on organizational learning, transaction costs economics and industrial organization, a conceptual model and propositions are developed that intend to close important research gaps.

Findings

The model includes competitive strategy as a mediator of the effects of relatedness on foreign unit performance, type of foreign unit – that is, a wholly owned unit or joint venture – as a moderator; and competition barriers as a moderator.

Research limitations/implications

In future research, the propositions need to be transformed into testable hypotheses. It is recommended to treat relatedness as a multidimensional concept.

Practical implications

A firm is primarily advised to evaluate how its relatedness with foreign units enables knowledge transfer. A foreign cost leadership strategy benefits from product relatedness, while a differentiation strategy calls for resource relatedness.

Originality/value

The proposed model is unique as it includes an actionable component that mediates the effects of relatedness on international performance, i.e. competitive strategy, and concerns both wholly owned foreign units and international joint ventures.

Details

European Business Review, vol. 31 no. 2
Type: Research Article
ISSN: 0955-534X

Keywords

Article
Publication date: 18 May 2010

Anders Pehrsson

The purpose of this paper is to improve the existing knowledge of international strategy antecedents of foreign subsidiary performance.

Abstract

Purpose

The purpose of this paper is to improve the existing knowledge of international strategy antecedents of foreign subsidiary performance.

Design/methodology/approach

Hypotheses are developed regarding the impact of perceived relatedness between the foreign subsidiary and the parent firm's core business unit, and the moderating effect of the subsidiary's business strategy. In order to test the hypotheses, the study uses survey data from Europe (Germany and the UK), and the USA, and the subsidiaries belong to Swedish manufacturing firms.

Findings

Perceived relatedness regarding intangible resources affects foreign subsidiary performance positively. Competitive differentiation and market knowledge of a foreign subsidiary reinforce the performance impact of the perceived relatedness.

Research limitations/implications

A foreign subsidiary's relatedness to the core business unit of its parent firm determines the subsidiary's ability to assimilate the parent firm's core competencies. The relatedness represents a synergy potential that is realized by the subsidiary's core competence exploitation and economies of learning.

Originality/value

The paper extends current knowledge of international strategy antecedents of foreign subsidiary performance as it applies the perceptual approach to relatedness and acknowledges the impact of foreign subsidiary strategy.

Details

Journal of Strategy and Management, vol. 3 no. 2
Type: Research Article
ISSN: 1755-425X

Keywords

Article
Publication date: 13 May 2014

Anders Pehrsson

There is a lack of research on how the industrial firm's international strategy is associated with basic and advanced value-adding modes of the wholly owned foreign subsidiary…

Abstract

Purpose

There is a lack of research on how the industrial firm's international strategy is associated with basic and advanced value-adding modes of the wholly owned foreign subsidiary. The purpose of this paper is to fill the gap by answering two questions: how are relatedness between the firm and the foreign subsidiary, and the firm's international scope associated with foreign subsidiary's value-adding mode? How does the subsidiary's market experience moderate the relationships?

Design/methodology/approach

The study develops a conceptual model that integrates strategy theory and internationalization theory in order to explain basic value-adding modes (promotion, sales, and after-sales services), and advanced modes that also include product development and/or production. Also, the study tests the model using statistical data from subsidiaries of Swedish firms operating in Germany, the USA, and the UK.

Findings

It was found that greater relatedness between the core business unit of the parent firm and the foreign subsidiary favors a basic mode. However, the foreign subsidiary's market experience weakens the relationship, and the interaction triggers an advanced mode. Also, greater international scope of the firm favors an advanced mode.

Research limitations/implications

The model test shows that research needs to consider both international strategy and market experience in explaining value-adding modes of an industrial firm's wholly owned subsidiary.

Practical implications

By using the study contributions the industrial firm's efforts to efficiently implement international strategy would become more efficient as strategy coherence will increase.

Originality/value

This paper contributes to literature on international strategy and internationalization by showing that international strategy and market experience of foreign markets mutually impact value-adding modes of wholly owned foreign subsidiaries.

Details

Journal of Strategy and Management, vol. 7 no. 2
Type: Research Article
ISSN: 1755-425X

Keywords

Article
Publication date: 1 December 1998

Prescott C. Ensign

Discusses how interrelationships can be developed for synergy. Also focuses on horizontal strategy as a way to achieve competitive advantage. Organizational context can determine…

6593

Abstract

Discusses how interrelationships can be developed for synergy. Also focuses on horizontal strategy as a way to achieve competitive advantage. Organizational context can determine a firm’s motivation and ability to develop interrelationships that result in overall competitive advantage. Corporate strategy must move beyond the idea that the primary way of creating synergy is the combination of related businesses (by buying and selling businesses). Corporate strategy must focus on creating value that is independent of business unit value. This means developing horizontal strategies that have the objective of coordinating activities and developing programs that encourage the sharing of resources and skills. An understanding of the horizontal organization helps to emphasize that organizational structure and processes are significant in developing interrelationships with the potential to reach the goals of synergy and competitive advantage.

Details

Management Decision, vol. 36 no. 10
Type: Research Article
ISSN: 0025-1747

Keywords

Article
Publication date: 26 November 2021

Samar Rahi, Mahmoud Alghizzawi, Sajjad Ahmad, Mubbsher Munawar Khan and Abdul Hafaz Ngah

This study aims to gain insight into factors that impact employee readiness to change and organizational change management. Therefore, an integrative research model is developed…

1033

Abstract

Purpose

This study aims to gain insight into factors that impact employee readiness to change and organizational change management. Therefore, an integrative research model is developed with the combination of perceived competence, perceived relatedness, perceived autonomy, codification strategy and personalization strategy to investigate employee readiness to change. The research model tests the mediating role of employee readiness to change between factors underpinned self-determination theory, knowledge management strategy and organizational change management. In addition to the moderating role of self-efficacy is examined between the relationship of employee readiness to change and organizational change implementation.

Design/methodology/approach

This research is conducted under a positive paradigm, and therefore, a quantitative research approach is incorporated to design a research strategy. The research model is empirically tested with a sample size of 361 employees working in commercial banks of Pakistan. For data analysis, the structural equation modelling approach is applied.

Findings

Empirical findings indicate that altogether perceived competence, perceived autonomy, perceived relatedness, codification and personalization strategies had explained 76.8% variance in employee readiness to change. The effect size analysis shows that codification strategy has the largest impact in determining employee readiness to change. Therefore, the relatedness of employee tasks stands at the second stage in determining employee readiness to change. The predictive relevance of the research model is computed through blindfolding procedure and revealed substantial predictive relevance in measuring employee readiness to change. The findings of the research confirmed that the relationship between employee readiness to change and organizational change implementation will be stronger when self-efficacy is higher.

Practical implications

The current research has several contributions to theory and practice. Theoretically, this research extends the self-determination theory with knowledge management strategy and enriches literature in employee readiness to change and organizational change management context. Practically, this research suggests that policymakers should focus on factors underpinned by self-determination theory and knowledge management model to develop a positive attitude among employees towards readiness to change. Similarly, self-efficacy is another important factor that moderates the relationship between readiness to change and change implementation and should be considered for managerial implication.

Originality/value

This research is significant as it integrates two unique models, namely, the self-determination framework and the knowledge management model to investigate employee readiness to change. In addition to that, the research model is extended with the moderating effect of self-efficacy between the relationship of employee readiness to change and organizational change implementation.

Details

International Journal of Ethics and Systems, vol. 38 no. 2
Type: Research Article
ISSN: 2514-9369

Keywords

Article
Publication date: 1 July 2004

Anders Pehrsson

This article presents a study of the link between strategy competence and performance in the context of international market entry. The concept of strategy competence encompasses…

11856

Abstract

This article presents a study of the link between strategy competence and performance in the context of international market entry. The concept of strategy competence encompasses international market entry and business relatedness. It is assumed that efforts of a firm to establish a business in a market where the firm encounters limited entry barriers, and where the local business belongs to the corporate core, lead to high performance in the local business. The empirical findings are based on a study of 173 Swedish ventures in Germany and indicate that limited customer access problems lead to high performance. At the same time, high relatedness between the core business and the local business, in terms of similar requirements for management skills and similar brand recognition, leads to high performance of the local business. In light of the findings, management would be well advised to leverage key management skills such as brand management from the core to the local business and to continuously evaluate ways to achieve customer access.

Details

Management Decision, vol. 42 no. 6
Type: Research Article
ISSN: 0025-1747

Keywords

Book part
Publication date: 27 June 2017

Timo Sohl and Govert Vroom

While the literature on corporate strategy has typically focused on examining diversification along the industry and geographical market dimensions, this study seeks to supplement…

Abstract

While the literature on corporate strategy has typically focused on examining diversification along the industry and geographical market dimensions, this study seeks to supplement previous research by introducing the concept of business model as a new way of thinking about diversification. Specifically, by integrating the literatures on business models, diversification, and acquisition strategy, we provide a conceptual analysis of how business model relatedness may influence performance implications of M&As. When business models among acquirers and targets are related, the sharing and transfer of superior resources may improve post-acquisition performance. In contrast, when business models among acquirers and targets are unrelated, internal and external identity conflicts may harm post-acquisition performance. Moreover, the conceptual framework developed in this study suggests that even if acquirers and targets are related in a product and geographical market sense, dissimilarities across business models may still harm post-acquisition performance. Overall, we suggest that using the recently emerged concept of business model may provide a new step in examining diversification decisions above and beyond the traditionally examined concepts of product and geographical markets, providing a more complete understanding of when and how multibusiness firms can create value.

Open Access
Article
Publication date: 12 March 2024

Arthur Ribeiro Queiroz, João Prates Romero and Elton Eduardo Freitas

This article aims to evaluate the entry and exit of companies from local productive structures, with a specific focus on the sectoral complexity of these activities and the…

Abstract

Purpose

This article aims to evaluate the entry and exit of companies from local productive structures, with a specific focus on the sectoral complexity of these activities and the complexity of these portfolios. The study focuses on empirically demonstrating the thesis that related economic diversification exacerbates the development gap between more and less complex regions.

Design/methodology/approach

The article uses indicators formulated by the economic complexity approach. They allow a relevant descriptive analysis of the economic diversification process in Brazilian micro-regions and provide the foundation for the econometric tests conducted. Through three distinct estimation strategies (OLS, logit, probit), the influence of complexity and relatedness on the entry and exit events of firms from local portfolios is tested.

Findings

In all estimated models, the stronger relationship between an activity and a portfolio significantly increases its probability of entering the productive structure and, at the same time, acts as a significant factor in preventing its exit. Furthermore, the results reveal that the complexity of a sector reduces the probability of its specialization in less complex regions while increasing it in more complex regions. On the other hand, sectoral complexity significantly increases the probability of a sector leaving less complex local structures but has no significant effect in highly complex regions.

Research limitations/implications

Due to the data used, the indicators are calculated considering only formal job numbers. Additionally, the tests do not detect the influence of spatial issues. These limitations should be addressed by future research.

Practical implications

The article characterizes a prevailing process of uneven development among Brazilian regions and brings relevant implications, primarily for policymakers. Specifically, for less complex regions, policies should focus on creating opportunities to improve their diversification capabilities in complex sectors that are not too distant from their portfolios.

Originality/value

The article makes an original contribution by proposing an evaluation of regional diversification in Brazil with a focus on complexity, introducing a more detailed differentiation of regions based on their complexity levels and examining the impact of sectoral complexity on diversification patterns within each group.

Details

EconomiA, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1517-7580

Keywords

Article
Publication date: 4 September 2017

Nadine Andrews

The purpose of this study is to gain insight into psychosocial factors influencing sustainability professionals in their work to lead by influencing and improving…

1139

Abstract

Purpose

The purpose of this study is to gain insight into psychosocial factors influencing sustainability professionals in their work to lead by influencing and improving pro-environmental decision-making in their organisations and to increase understanding of psychosocial factors that affect their effectiveness in achieving desired results.

Design/methodology/approach

Using Interpretative Phenomenological Analysis as a framework, the study enquires into the lived experience of six research subjects. The participants are sustainability professionals and leaders from the UK and Canada. The primary data source is semi-structured interviews, analysed with micro-discourse analysis.

Findings

Key psychosocial factors involved in participants’ experience are identified, specifically psychological threat-coping strategies, psychological needs, motivation and vitality, finding complex interactions between them. Tensions and trade-offs between competency, relatedness and autonomy needs and coping strategies such as suppression of negative emotion and “deep green” identity are modelled in diagrams to show the dynamics. How these tensions are negotiated has implications for psychological well-being and effectiveness.

Practical/implications

The concepts and models presented in this paper may be of practical use to sustainability professionals, environmentalists and organisation leaders, for example, in identifying interventions to develop inner resources, support authentic and effective action and disrupt maladaptive responses to ecological crisis.

Originality/value

The study contributes insight to understanding of underlying processes shaping environmental cognition and behaviour, particularly in relation to psychological threat-coping strategies and interacting factors. With a transdisciplinary approach, the methodology enables nuanced interpretation of complex phenomena to be generated.

Details

Sustainability Accounting, Management and Policy Journal, vol. 8 no. 4
Type: Research Article
ISSN: 2040-8021

Keywords

1 – 10 of over 5000