INO Seminar

Seminar by Filippo Carlo Wezel, University of Lugano, Switzerland.

A DYNAMIC THEORY OF STRATEGIC POSITIONING. A Diversity-Dependence Perspective

ABSTRACT

The question as to strategic positioning in the marketplace is at the heart of competitive strategy. We suggest a dynamic, multi-level diversity-dependence theory of strategic positioning that maps the macro-level industry evolution of organizational diversity with the micro-level events of firm entry and exit. In particular, we develop hypotheses as to the decision where to locate in product space by new entrants, as well as the exit likelihood of incumbent firms given their location in product space. The key argument is that macro-level organizational diversity drives entrepreneurial entry location in product space, and shapes the performance impact that incumbents obtain from strategic conformity. Our hypotheses are tested in the British motorcycle industry in the 1895-1993 period, where we find support for our theory.