How to overcome path dependency through resource reconfiguration

Nikolaos Goumagias*, Kiran Jude Fernandes, Alberto Nucciarelli , Feng Li

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

Firms reconfigure their resources when responding to changes in their external or internal environment, often by incorporating new knowledge and resources in collaboration with external stakeholders. However, the reconfiguration process is challenging, costly, and often fails. The firm’s history plays an important role in the resource reconfiguration process being path dependent. Path dependency, debatably, leads to lock-in effects that prevent reconfiguration. However, we argue that this is a very limited viewpoint. In this paper, drawing empirical evidence from the digital games industry, we contend that path dependency constrains the reconfiguration action space and can potentially improve strategic planning by identifying the paths of least resistance. Depending on the extent of the reconfiguration, we identify two alternatives: direct reconfiguration (horizontal reconfiguration) or increasing the complexity by incorporating additional configurations (vertical reconfiguration).
Original languageEnglish
Pages (from-to)78-91
Number of pages14
JournalJournal of Business Research
Volume145
Early online date3 Mar 2022
DOIs
Publication statusE-pub ahead of print - 3 Mar 2022

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