The Role of Resource Flexibility in Leveraging Strategic Resources

28 Pages Posted: 14 Jun 2011

See all articles by James G. Combs

James G. Combs

University of Alabama - Culverhouse College of Commerce & Business Administration

David J. Ketchen, Jr

affiliation not provided to SSRN

R. Duane Ireland

Texas A&M University - Department of Management

Justin W. Webb

Oklahoma State University - Stillwater

Date Written: July 2011

Abstract

Recent advances in resource‐based theory suggest that the ways managers use strategic actions to leverage resources has important influences on firms' resulting competitive advantages. However, theory dealing with the nature of leveraging remains underdeveloped. We develop the notion that strategic actions that successfully leverage one resource might not leverage another resource. In particular, our theorizing distinguishes between flexible resources that can be leveraged in new markets and rigid resources that must be leveraged in their current market. Using data from the restaurant industry, we find evidence that top management team experience (a flexible resource) can be profitably leveraged by franchising, but that attempting to leverage specific knowledge (a rigid resource) through either franchising or multi‐chaining weakens performance. Our theory and results help explain how different types of resources can be leveraged using different strategic actions.

Suggested Citation

Combs, James G. and Ketchen, Jr, David J. and Ireland, R. Duane and Webb, Justin W., The Role of Resource Flexibility in Leveraging Strategic Resources (July 2011). Journal of Management Studies, Vol. 48, Issue 5, pp. 1098-1125, 2011, Available at SSRN: https://ssrn.com/abstract=1864425 or http://dx.doi.org/10.1111/j.1467-6486.2009.00912.x

James G. Combs (Contact Author)

University of Alabama - Culverhouse College of Commerce & Business Administration ( email )

Culverhouse College of Business
Tuscaloosa, AL 35487-0223
United States

David J. Ketchen, Jr

affiliation not provided to SSRN

No Address Available

R. Duane Ireland

Texas A&M University - Department of Management ( email )

430 Wehner
College Station, TX 77843-4218
United States

Justin W. Webb

Oklahoma State University - Stillwater ( email )

Stillwater, OK 74078-0555
United States

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