Are more resources always better for growth? Resource stickiness in market and product expansion

Abstract

We examine how managerial growth logics combine with financial and human resource slack to influence the short-term revenue growth of a sample of 112 manufacturing firms drawn from a unique database provided by the Ewing Marion Kauffman Foundation. Our results provide evidence that firms pursuing product expansion logics generally grow more slowly than firms that are not expanding their product base, but that financial slack positively moderates this relationship. We also find that human resource slack enhances short-term market expansion, but slows down short-term product expansion. We discuss the implications of these results for resource-based views of growth.

The Two Facets of Collaboration: Cooperation and Coordination in Strategic Alliances

“…Partners may, for example, struggle to implement alliance coordination provisions, or changes to such provisions, due to resistance from organizational members or external stakeholders (Doz, 1996;Hannan & Freeman, 1984). Furthermore, resource stickiness may constrain how fast partners can acquire and integrate new tangible or intangible resources, or repurpose existing resources for new purposes (Mishina, Pollock, & Porac, 2004;Penrose, 1959;Szulanski, 2003). Thus they will be unable to properly respond to plans if they require resources and capabilities that are not readily available.…”

Entrepreneurs as intermediaries

“…A lot of entrepreneurs may lack significant tangible resources. However, they often compensate for such a lack of tangible resources by being proactive (Mishina, Pollock, & Porac, 2004;Peng, 2001). In other words, instead of waiting for opportunities to present themselves, resource-poor but enthusiastic entrepreneurs can and need to constantly search for opportunities (Katila & Shane, 2005).…”

Strategy Analysis of the Biggest World Supermarkets With Open Capital and Which Act in the Brazilian Market

“…For Nohria and Gulati (1996) and Kim and Huarng (2011), this strategy is considered to be a kind of innovation. More recent studies such as Baker and Nelson (2005) and Mishina, Pollock, and Porac (2004) claim that the excess resources are also considered as a financial slack, in which this is only used when the retailer's performance begins to fall.…”

“…In the vision of Mishina et al (2004), the supermarket format only gained momentum after World War II in the United States, and its growth is slow.…”