Initial Conditions, Resource Configuration, and Technological Performance
Date Issued
2009
Date
2009
Author(s)
Wu, Hsiang-Hsun
Abstract
Whether the organization can enhance performance through resource configuration has been the one of core arguments between organizational theory and strategy theory. Strategy scholars emphasize that the organization can through the allocation of resources to gain better economic performance. Organizational theory scholars do not deny the organization’s capability of resource configuration but question the organizational capability to timely respond to environmental changes. Because of the organization inertia, organizations can not immediately change the resource configuration to reflect the need of the environment. Organization theory scholars further argue that the organizational inertia is formed by the initial conditions which are characterized with random distribution. Hence, initial conditions might be the most determinant of performance, not organizational resource configuration. However, strategy theories such as the resource-based view and dynamic capability perspective are not so concerned about the influence of initial conditions on the performance. This study intends to propose a comprehensive point of view based on these two theoretical streams. he current study examined the enduring effect of initial conditions and potential interaction effect between initial conditions and resource configuration on technological performance. The research took global TFT-LCD manufacturers from 1988 to 2006 for the empirical test. In this context, the firm’s network positions -- technological status and competitive crowding in the technological network at the initial stage of industry were used to define the initial conditions. The firm’s resource configuration includes the absorptive capacity and external resource leverage. Results indicated that initial status has positive and increasing effect on technological performance. Initial crowding which was different from expected had positive effect on technological performance. Results further indicated that firms with poor initial conditions can increase the absorptive capacity and leverage the external resources to improve the technical performance. However, it is worthy to note that detailed results showed that initial conditions limit the effectiveness of enhancing absorptive capacity and engaging external resource leverage. For example, the performance of initial low-crowing or low-status firms with highly investment of absorptive capacity cannot eventually be compared with that of initial high-crowding or high-status firms. This showed that, when we did not consider the impact of initial conditions, the influence of resource configuration could be over-estimated. These results provided rich strategic implications for practice and shed light on future research of initial conditions and resource configuration.
Subjects
initial conditions
organizational ecology
resource based view
dynamic capability
resource configuration
Type
thesis
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