Business Model Diversification, Resource Relatedness, and Firm Performance
Journal
Academy of Management Best Paper Proceedings
ISSN
0065-0668
ISSN-Digital
0896-7911
Type
journal article
Date Issued
2014-08-01
Author(s)
Abstract
Despite the recognition that many firms operate multiple business models at the same time, little is known about when and how business model diversification may create value. In this study, we develop the construct of business model relatedness and examine its relationship with firm performance. Using a unique panel dataset of multibusiness firms in the retail- and wholesale-trade sectors (1997-2010), we find that the extent to which business model diversification is related increases firm performance. Interestingly, results also show that business model relatedness is more influential in determining firm performance than industry relatedness. This finding suggests that the concept of business model relatedness may be better able to capture the underlying resource relatedness among lines of business than the traditionally used concept of industry relatedness.
Language
English
Keywords
Business model
corporate diversification
relatedness
firm performance
resource-based view.
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Academy of Management
Publisher place
Briarcliff Manor, NY
Number
74 (forthcoming)
Start page
1
End page
6
Pages
6
Subject(s)
Division(s)
Eprints ID
230645