Are more resources always better for growth? Resource stickiness in market and product expansion

We examine how managerial growth logics combine with financial and human resource slack to influence the short-term revenue growth of a sample of 112 manufacturing firms drawn from a unique database provided by the Ewing Marion Kauffman Foundation. Our results provide evidence that firms pursuing pr...

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Bibliographic Details
Published in:Strategic management journal 2004-12, Vol.25 (12), p.1179-1197
Main Authors: Mishina, Yuri, Pollock, Timothy G., Porac, Joseph F.
Format: Article
Language:English
Subjects:
Business expansion
Business structures
content analysis
Corporate strategies
Correlation analysis
Economic growth rate
Entrepreneurs
entrepreneurship
Executive compensation
Financial resources
growth
Growth rate
Human resource management
Human resources
Influence
Management
Management science
managerial cognition
Manufacturing
Market
Narratives
Resource allocation
resource-based
Sales growth
slack
Strategic management
Studies
Written narratives
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Summary:We examine how managerial growth logics combine with financial and human resource slack to influence the short-term revenue growth of a sample of 112 manufacturing firms drawn from a unique database provided by the Ewing Marion Kauffman Foundation. Our results provide evidence that firms pursuing product expansion logics generally grow more slowly than firms that are not expanding their product base, but that financial slack positively moderates this relationship. We also find that human resource slack enhances short-term market expansion, but slows down short-term product expansion. We discuss the implications of these results for resource-based views of growth.
ISSN:0143-2095
1097-0266
DOI:10.1002/smj.424