Reference no: EM132832983

Case Study "Relative exploration and firm performance: Why resource-theory alone is not sufficient"

The resource-based theory states that having valuable, rare, inimitable, non-substitutable, and organized (VRINO) resources and capabilities give firms a sustainable performance. However, by integrating the attention- based view, we raise a question as to why VRIN-O resources alone are not sufficient for sustainable performance. We introduce the variable - decision-makers' attention- as a key moderator in achieving sustainable performance so that VRIN-O/capability and capability/resource heterogeneity may last longer. To test this relationship, we examine how the needs of firms to balance their exploration and exploitation efforts, called relative exploration anchored to resource-based theory is influenced by CEO's attention towards entrepreneurial orientation and market orientation as moderators. Using a panel data set of 269 firms listed on the Nordic NASDAQ stock exchange, we find an inverted U-shaped relationship between relative exploration and long-term performance, while the attentions of the CEO have a positive moderation effect. Thus, using the attention- based view complements the resource-based theory in explaining sustainable competitive advantage especially in the dynamic environment.

1. Discuss the problem researcher define in the following research also identify the source of its research gap?

2. Identify and discuss the methods used in the above study?

Note: Please solve all the answers in an organized manner