From Resource Allocation to Strategy

by Bower, Joseph L.; Gilbert, Clark G.

• ISBN13: 9780199277452
• ISBN10: 0199277451
• Format: Paperback
• Copyright: 2007-10-11
• Publisher: Oxford University Press

Summary

Is strategy a coherent plan conceived at the top by a visionary leader, or is it formed by a series of individual commitments, not always reflecting what top management has in mind? If it is a series of commitments, how can they be managed? To answer these questions, Joseph L. Bower and Clark G. Gilbert present research that examines how strategy is actually made by company managers across several levels of an organization. The research penetrates the "black box" of strategy formulation and shows that a company's realized strategy emerges less from the formal statements of corporate strategy, but often out of the pattern of resource commitments that originate across every level of the firm. Drawing on over thirty yeas of research on resource allocation, including studies from Harvard Business School, Stanford, London Business School, and INSEAD, the book's five sections detail the structural characteristics of the resource allocation process, how the process can lead to breakdowns in strategic outcomes, and where top management can intervene to shape desired results. And while the organizing authors connect over three decades of research on resource allocation, they have also included assessments of this work by thought leaders in the fields of economics, competitive strategy, organizational behavior, and strategic management. The processes described represent the complex reality of strategy formulation in large organizations, but the ideas are presented in a way that enables the reader to access and understand the implications of these complexities. The findings should inform the research of economists, strategists, and behavioural scientists. Thoughtful executives and those who consult with them will also find the book provocative and instructive.

Table of Contents

List of Figures	p. xiv
List of Tables	p. xvi
List of Contributors and Affiliations	p. xviii
Introduction to the Resource Allocation Process
Linking Resource Allocation to Strategy	p. 3
Modeling the Resource Allocation Process	p. 26
The Role of Strategy Making in Organizational Evolution	p. 38
Anomaly-Seeking Research: Thirty Years of Theory Development in Resource Allocation Theory	p. 71
When the Bottom-up Process Fails
When the Bottom-up Resource Allocation Process Fails	p. 93
Customer Power, Strategic Investment, and the Failure of Leading Firms	p. 99
No Exit: The Failure of Bottom-up Strategic Processes and the Role of Top-down Disinvestment	p. 135
The Process of International Expansion: Comparing Established Firms and Entrepreneurial Start-ups	p. 176
Restoring the Bottom-up Process
Restoring the Bottom-up Process of Resource Allocation	p. 207
Strategy Making as an Iterated Process of Resource Allocation	p. 213
Beyond Resource Allocation: How Definition and Impetus Interact to Shape Strategic Outcomes	p. 269
The Need for Top-down Intervention
Corporate Intervention in Resource Allocation	p. 299
The Entrepreneurial M-Form: A Case Study of Strategic Integration in a Global Media Company	p. 307
Strategic Flexibility: Corporate-level Real Options as a Response to Uncertainty in the Pursuit of Strategic Integration	p. 330
Resource Allocation Processes in Multidimensional Organizations: MNCs and Alliances	p. 365
Outside Commentaries on the RAP Perspective
Resource Allocation, Strategy, and Organization: An Economist's Thoughts	p. 395
Comments on the Resource Allocation Process	p. 403
Research Complementarities: A Resource-Based View of the Resource Allocation Process Model (and Vice Versa)	p. 409
CEO as Change Agent?	p. 427
Conclusion
A Revised Model of the Resource Allocation Process	p. 439
Index	p. 457
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