Individual decision-making by top executives as a valuable resource for strategic management : a resource-based view and dynamic capability approach

Enríquez-de-la-O, José Francisco (2015) Individual decision-making by top executives as a valuable resource for strategic management : a resource-based view and dynamic capability approach. VEZETÉSTUDOMÁNY, 46 (11). pp. 2-14. ISSN 0133-0179

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Abstract

Strategy is highly important for organisational success and the achievement of competitive advantage. Strategy is dynamic and it depends on accurate individual decision-making from medium and high-level managers and executives. Since managers always formulate strategy, its formulation depends mostly on their assertive decisions. Making good decisions is a complex task, even more in today’s business world where a large quantity of information and a dynamic environment forces people to decide without having complete information. As Shafir, Simonson, & Tversky (1993) point out, “the making of decisions, both big and small, is often difficult because of uncertainty and conflict”. In this paper the author will explain a basic theoretical framework about top manager’s individual decision-making, showing how complex the process of making high-impact decisions is; then, he will compare this theory with one of the most important streams in strategic management, the Resource-Based View (RBV) of the firm. Finally, within the context of individual decision-making and the RBV stream, the author will show how individual decision makers in top management positions constitute a valuable, rare, non-imitable and non-substitutable resource that provides sustained competitive advantage.

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