Todd M. Alessandri

Organizational slack, experience, and acquisition behavior across varying economic environments

Purpose – The purpose of this paper is to examine the effects of the organizational slack and acquisition experience on acquisition behavior across varying environmental conditions. Drawing from behavioral theory and the threat-rigidity hypothesis, the paper explores firm acquisition behavior, in terms of type of acquisitions, before and during the recent economic downturn. Design/methodology/approach – Using data on 385 acquisitions in Italy in the period 2007-2010, the paper tests hypotheses on how organizational slack and acquisition experience influence the likelihood of cross-border and diversifying acquisitions relative to domestic, non-diversifying acquisitions prior to and during the economic downturn. Findings – Results suggest that the availability of financial resources and acquisition experience both have an important influence on acquisition behavior. Firms with greater slack and acquisition experience were more likely to make diversifying and/or cross-border acquisitions, compared to domesti...

Surviving the Bulls and the Bears: Robust Strategies and Shareholder Wealth

Abstract This paper raises the issue of robustness of strategy over financial market cycles. Using an inductive approach, it examines the performance of companies in term of relative value creation or destruction over a bull and bear market cycle. The sample for this research consists of 54 large US firms from seven industries (airlines, banking, computers, network equipment, pharmaceuticals, retail, and semiconductors). The findings demonstrate that few firms performed well in both the bull and bear markets but those that did achieve superior performance over the market cycle employed innovative strategies that competitors struggled to imitate. These superior strategies resulted in lower cost structures and/or the ability to charge premium prices. It concludes by offering lessons that managers should integrate into their business models to obtain similar competitive advantage that is robust to drastically changing market conditions.