Title

Linking Hypercompetition and Strategic Group Theories: Manoeuvering and Entry Pathways in the U.S. Insurance Industry

Publication Type

Journal Article

Publication Date

2001

Abstract

Focusing on the dynamics of strategic maneuvering, this paper draws parallels between the accumulated perspectives of strategic group theory and ideas drawn from evolutionary economics and from a recent strategy-oriented book on hypercompetition (D'Aveni RA. 1994. Hypercompetition: Managing the Dynamics of Strategic Maneuvering. The Free Press: New York). Using insurance industry data, the paper first uses the methodological framework of strategic groups to define competitive positioning and the identity of close competitors. It then develops a Markovian model to analyse two important aspects of strategic maneuvering over time: the level of firm movement, and the determination of optimal maneuvering paths and their related long-term performance. The results provide insights into industry competitive dynamics and rivalry. First, there is clear evidence of strategic maneuvering over the entire time period studied and a higher level of maneuvering in the long run. Second, for some competitive scenarios, there are optimal maneuvering trajectories that optimize a firm's long-term economic performance.

Discipline

Business

Research Areas

Strategy and Organisation

Publication

Managerial and Decision Economics

Volume

22

Issue

4-5

First Page

265

Last Page

279

ISSN

0143-6570

Identifier

10.1002/mde.1015

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