Presenter: Christian Geisler Asmussen, King’s college London & Department of Strategy and Innovation, Copenhagen Business School
April 25th, 2019 at 11.00-12.00
Where: Kraks Fond, Frederiksholms Kanal 30, seminar room
Competitive Rivalry and the Management of (Socially) Valuable Resources
Research in strategic management suggests that firms reap higher economic benefits from their competitive advantages when they are faced with strong rivalry in their product markets. Accordingly, it has been suggested that firms facing more intense competition should be willing to pay more for resources such as technologies and brands, as well as inclined to invest more aggressively in corporate social responsibility (CSR). However, most empirical tests of these ideas have been built on theoretical arguments that do not take strategic interaction into account, effectively ignoring how product market rivals respond to resource acquisition strategies, as well as how such strategies may be coordinated across dispersed managers within the firm. Drawing on game-theoretic modeling, this presentation outlines a research program that revolve around these issues, including findings from three papers. The first paper analyzes how competition is influenced by “scale free” resources, which can be acquired by multiple firms simultaneously and deployed against one another in product market competition. The second paper looks at the organizational challenges of managing CSR-related resources—specifically, “social brands”—in a global context. The third paper combines the rivalry aspect from the first paper with the social dimension of the second paper, showing that increased competition will lead to more CSR in some scenarios, but less CSR in others—and sometimes will lead firms to invest more in social brands while actually doing less socially responsible action. In combination, these findings shed light on issues of resource-based strategic interaction between and within firms, and points to the importance of taking into account contextual factors when designing empirical studies of competition, strategic factor markets, and CSR.
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