Catherine A. Maritan

Building a Bridge Between Resource Acquisition and Resource Accumulation

Resource-based theory (RBT) has become one of the dominant perspectives in strategic management, and a very large body of work has developed; yet, there are aspects of RBT that remain underexplored and less developed than others. One of these aspects concerns how the heterogeneous resource positions that lie at the core of RBT come to exist. Two separate mechanisms have been described in the literature—resource acquisition in strategic factor markets and internal resource accumulation. The authors propose that considering these mechanisms jointly can generate insights and lay the groundwork for future work, and they discuss several issues that are critical to developing a more complete theoretical and practical understanding of the creation of heterogeneous resource positions.

Investing in Capabilities: The Dynamics of Resource Allocation

In this research, we examine the dynamic capability of resource allocation to invest in operational capabilities. Using a computer simulation, we model a process of firms competing in factor markets for opportunities to invest in existing capabilities and acquire new ones. Based on the simulation results, we derive a set of propositions about the conditions under which there are and are not performance benefits from possessing a superior ability to search for new capabilities. Because the definition of what constitutes a new capability is based on a firms preexisting capabilities, we also incorporate differences in initial endowments into the analysis. We find that endowment and search ability both matter, and that in many circumstances, the effects of possessing a superior endowment dominate the effects of superior search ability.

Capabilities, Real Options, and the Resource Allocation Process

In this paper, we consider the relationship between the investment decision process and returns to investments in capabilities. We draw on characteristics of capabilities to develop a framework that identifies four components of the returns to an investment that are derived from industry-based versus firm-specific elements, and option and non-option elements. We then link these components to elements of the resource allocation process. In taking this approach we place the study of real options into the larger investment context, recognizing that they co-exist with and should be understood in conjunction with other investment characteristics. These arguments highlight the importance of connecting the investment process with realization of returns, thereby providing the conceptual foundations for a decision tool.

Bringing a Resource and Capability Lens to Resource Allocation

This article highlights a perspective that has been underexplored in resource allocation research. By viewing resource allocation through a resource and capability lens, three connections are developed between resource-based theories of strategy and strategy research on resource allocation. First, the lens is applied to frame capital investments as investing in capabilities. This framing provides a theoretical path connecting the strategic purpose of investments, through value creation from resource commitments, to the creation of competitive advantage. Second, resource allocation for the purpose of capability development is related to a resource-based model of asset accumulation. Placing resource allocation decisions in the context of capability development suggests that key features of the asset accumulation process can usefully inform research on the resource allocation process. Last, corporate capital allocation is connected to resource redeployment in multibusiness firms. This connection explicates ways in which corporate headquarters can add to firm value. These connections illustrate the potential that resource-based theories have to contribute insights to resource allocation research.

Resource Allocation and Strategy

Resource allocation is fundamental to strategic management. Yet, surprisingly, there is not a large body of literature specifically about the allocation of financial, physical, technological, and human resources that support firm strategies. This special issue seeks to bring renewed attention to resource allocation as an important topic for strategy research. The curated set of articles and commentaries offer conceptual and empirical contributions that assess the current state of research on the topic, present analyses and new insights, and propose promising directions for future research. Through this special issue, we hope to encourage more research that examines resource allocation as a central focus of study for achieving deeper and better understandings about firm strategies.