A firm's organizational and technological boundaries are two important demarcation lines when sourcing for technology. Based on this theoretical lens, four possible combinations of exploration and exploitation emerge. Applying an ambidexterity perspective to a firm's technology sourcing strategy, we hypothesize that a curvilinear relationship exists between a firm's technology sourcing mix and its performance. We further introduce a contingency element by proposing that a firm's absorptive capacity exerts a positive moderating effect on this relationship. We empirically test these hypotheses on a random, multi-industry sample of U.S. manufacturing companies. We find support for the notion that the relationship between technology sourcing mix and firm performance is an inverted U-shape. Moreover, higher levels of absorptive capacity allow a firm to more fully capture the benefits resulting from ambidexterity in technology sourcing.

Purpose -This paper, anchored in the resource-based view of the firm, attempts to develop linkages between firm-level resources, Porter's competitive strategy space and firm performance and explores them in the context of a new industry -the marketing technology industry. Design/methodology/approach -In the marketing technology industry the authors classify resource configurations (generalists, specialists, innovators) which group firms with distinctive competences on similar resource dimensions. They then map these firm-level resource configurations onto their respective optimal strategies in the industry's competitive strategy space. Findings -The major findings are: some firms that are close together in strategy space vary in performance; some firms that are close together in strategy space belong to quite different resource configurations; firms that belong to the same resource configuration (i.e. are close together in resource space and distant from others) vary in performance; given the origin (i.e. resource configuration) of a new entrant there exists an optimal strategy that can be theoretically defined; and corresponding to each resource configuration there seems to exist a unique optimal region in strategy space. Originality/value -It is one of few attempts to empirically explore the parallels between firm level resource-based and industry level competitive strategies. IntroductionThe resource-based theory (RBV) literature (Barney, 1991;Grant, 1991;Penrose, 1959;Wernerfelt, 1984) explains firm performance in terms of firm level resource differences while the generic business strategy framework drawn from the theory of industry and competitive analysis (Porter, 1980;1985) argues that the failure to choose between one of the generic strategies in the strategy space of potential competitive strategies can result in inferior performance (Campbell-Hunt, 2000). In this paper, we examine firm performance by drawing upon and integrating insights from the two theories, i.e. firm-level resources and industry/market-based competitive strategies rather than by simply using only one of them. Indeed, Collis and Montgomery (2008, p. 142) note that "the RBV inextricably links a company's internal capabilities (what it does well) and its external environment (what the market demands and what competitors offer)".Following a literature review, we first develop hypotheses linking configurations based on resource position similarities (i.e. distinctive competences on similar resource dimensions), closeness in strategy space (i.e. the set of available strategies in an industry or market) and firm performance. We then test these hypotheses in the context of a new industry, namely, the marketing technology industry which supplies technologies specifically created for use in marketing applications. The process of finding strategic resource configurations is particularly important in new industries where stable or dominant competitive patterns may not yet be obvious or even have emerged yet (Porter, 1980). Therefore, the paper ...

We suggest that the relationships between strategy and financial performance and between strategy and marketing performance depend on the resource bundle and strategy of a firm. The better the correspondence between strategy and resource bundle, the better the performance. We empirically test and find support for this explanation. By building empirically calibrated models of the marketing and financial performance, we are able to show that, indeed, the optimum strategies for the two are not the same and more importantly that the difference varies depending on the resource bundle of a firm.KEYWORDS: Resource-based theory; strategy; coherence; performance; tradeoffs INTRODUCTIONAs one considers a firm's success, it is tempting to assume that marketing success is highly correlated to financial success. Further consideration would lead to the question of what is the relationship between the success of a brand or a product in the market place and that of firm's shareholder returns. In more general terms the question may be posed as one of providing a parsimonious explanation for the differences between the two: Traditionally, marketing activities focus on success in the product marketplace. Increasingly, however, top management requires that marketing view its ultimate purpose as contributing to the enhancement of shareholder returns (Day and Fahey, 1988). This change has led to the recognition that the relationship between marketing and finance must be managed systematically; no longer can marketers afford to rely on the traditional assumption that positive product-market results will translate automatically into the best financial results. (Srivastava, Shervani and Fahey, 1998, p. 2) The above quotation and the extant literature suggest that the traditional assumption that positive product-market results will translate automatically into the best financial results is not true. We propose a resource-strategy correspondence explanation to understand the differences in discrepancy between the two performance measures across firms in an industry.Our paper is set in the literature streams in marketing strategy and strategic management that examine the relationships between resources, strategies, competitive advantage and performance. If early studies have investigated the relationships between market share and profitability (e.g., Buzzell and Gale, 1987), over the last decade, the identification of the relationship between strategy, resources, and competitive advantage has become particularly important in the development of marketing strategy thought and practice (e.g., Bharadwaj, Varadarajan and Fahy, 1993;Capron and Hulland, 1999;Day and Van den Bulte, 2002;Day and Wensley, 1988;Dickson, 1996; Morgan, 1995, 1996;Srivastava, Fahey and Christensen, 2001;Srivastava et al., 1998). Indeed, the primary focus of this stream of the marketing strategy literature has been on identifying sources of competitive advantage, debating over the merits of various performance objectives for assessing competitive strength, and address...

Many new products are based on new technologies, which may in turn be based on new scientific discoveries. The extant literature on new product development has focused on how a firm may successfully commercialize new products. There is a corporate cost associated with new product failure, which extends beyond the final product-manufacturing corporation to all the parties involved in the supply chain for the failed product. The new product development community has developed frameworks for managing the new product development process to minimize new product failure, notably by incorporating customer preferences into a cross-functional approach to new product design and by creating a set of decision points or stage gates. The focus of these has been on the latter stages of the new product development process. Besides corporate decisions, society and its various institutions play a role in the shaping of new products from knowledge discoveries. Identifies how other participants may indeed influence the development of new products. Permits a more deliberate understanding of the possible impact of aiding or preventing a movement up the development hierarchy and so a clearer understanding of the potential benefits and opportunity costs may arise.