Publication:
Leveraging synergies versus resource redeployment: Sales growth and variance in product portfolios of diversified firms

Simple item page
dc.contributor.authorPasquini, Martina
dc.contributor.authorGiarratana, Marco
dc.contributor.authorSantaló, Juan
dc.contributor.funderState Research Agency
dc.contributor.rorhttps://ror.org/02jjdwm75
dc.date.accessioned2025-04-25T15:19:32Z
dc.date.available2025-04-25T15:19:32Z
dc.date.issued2021-04-02
dc.description.abstractResearch Summary This article analyzes the relationship between sales growth and variance for diversified firms. Distinguishing product niches linked by scale free versus non-scale free resources, this study predicts that the more a firm diversifies leveraging on a non-scale free resource, the more likely its sales growth and variance are positively correlated. However, this relationship is negatively moderated by the presence of a scale-free resource such that the presence of scale-free resources of high value implies a negative correlation. These theoretical intuitions are consistent with data from 2008 to 2013, reflecting firm sales growth rates in five industries spanning 45 product niches in seven EU countries and the United Kingdom. These industries prioritize shelf space as a non-scale free resource, and brand as a scale free resource. Managerial Summary Diversifiers may base their value creation either in pursuing synergies or in exploiting the benefits derived by internal resource redeployment across products or across industries. Here, we highlight the different managerial implications on risk/performance structure derived from diversification based on resource redeployment compared to diversified companies exploiting synergies. Can the disparity of sales growth between products of the same firm's portfolio be good for the corporate performance? Here, we show that diversification based on resource redeployment goes hand in hand with a positive relation between overall firm growth and variance of results within the same firm. On the contrary, firm diversification based on synergies implies a negative relationship between within firm disparity and overall firm growth.
dc.description.peerreviewedyes
dc.description.statusPublished
dc.formatapplication/pdf
dc.identifier.citationGiarratana, M. S., Pasquini, M., & Santaló, J. (2021). Leveraging synergies versus resource redeployment: Sales growth and variance in product portfolios of diversified firms. Strategic Management Journal, 42(12), 2245-2272. https://doi.org/10.1002/smj.3281.
dc.identifier.doihttps://doi.org/10.1002/smj.3281
dc.identifier.issn1097-0266
dc.identifier.urihttps://hdl.handle.net/20.500.14417/3783
dc.issue.number12
dc.journal.titleStrategic Management Journa
dc.language.isoen
dc.page.final2272
dc.page.initial2245
dc.page.total44
dc.publisherWiley
dc.relation.departmentStrategy
dc.relation.entityIE University
dc.relation.projectIDPID2019-104568GB-100
dc.relation.projectIDPID2019-111422GB-I00
dc.relation.schoolIE Business School
dc.rightsAttribution-NonCommercial-NoDerivatives 4.0 International
dc.rights.accessRightsinfo:eu-repo/semantics/openAccess
dc.rights.urihttps://creativecommons.org/licenses/by-nc-nd/4.0/deed.en
dc.titleLeveraging synergies versus resource redeployment: Sales growth and variance in product portfolios of diversified firms
dc.typeinfo:eu-repo/semantics/article
dc.version.typeinfo:eu-repo/semantics/publishedVersion
dc.volume.number42
dspace.entity.typePublication
relation.isAuthorOfPublication12109eb9-bcb9-4afb-a669-131aac6e0e90
relation.isAuthorOfPublicatione9508b29-b78b-4aa3-9560-d71aa11f6ee6
relation.isAuthorOfPublicationb15ba486-b637-4a5f-ae06-6a5e367ce510
relation.isAuthorOfPublication.latestForDiscovery12109eb9-bcb9-4afb-a669-131aac6e0e90
Files
Original bundle
Now showing 1 - 1 of 1
Thumbnail Image
Name:
Leveraging Synergies versus Resource Redeployment Sales Growth and Variance in Product Portfolios of Diversified Firms.pdf
Size:
541.67 KB
Format:
Adobe Portable Document Format
Download
License bundle
Now showing 1 - 1 of 1
No Thumbnail Available
Name:
license.txt
Size:
2.83 KB
Format:
Item-specific license agreed to upon submission
Description:
Download
Collections
Research Articles