The Management of Resources: Temporal Effects of Different Types of Actions on Performance

This article contributes to the understanding of competitive dynamics and resource management by studying empirically the element of time in the relationship between resource management actions and firm performance. It shows that four types of actions identified on the basis of the literature on competitive dynamics and resource management, namely, actions to structure, bundle, and leverage resources in product and regulatory arenas, differ in the time they take to positively affect firm performance, in the persistence of this positive impact, and in their total impact on performance over time. Better understanding of the temporal dimension of the action-performance relationship is important for theory and practice. On the theory side, time is a dimension of competitive strategy that has long been argued to be important but that is often neglected by researchers. In particular, existing theories in competitive strategy offer very few arguments that can be used to predict the timing of the impact of firm actions on performance. Regarding practice, managers need to know which actions can improve their firm performance in the short, medium, or long term and how sustainable the improvement is likely to be.