University of Groningen. The pathfinder Vrieling, Lammert

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1 University of Groningen The pathfinder Vrieling, Lammert IMPORTANT NOTE: You are advised to consult the publisher's version (publisher's PDF) if you wish to cite from it. Please check the document version below. Document Version Publisher's PDF, also known as Version of record Publication date: 1998 Link to publication in University of Groningen/UMCG research database Citation for published version (APA): Vrieling, L. (1998). The pathfinder s.n. Copyright Other than for strictly personal use, it is not permitted to download or to forward/distribute the text or part of it without the consent of the author(s) and/or copyright holder(s), unless the work is under an open content license (like Creative Commons). Take-down policy If you believe that this document breaches copyright please contact us providing details, and we will remove access to the work immediately and investigate your claim. Downloaded from the University of Groningen/UMCG research database (Pure): For technical reasons the number of authors shown on this cover page is limited to 10 maximum. Download date:

2 THE PATHFINDER STRATEGY PATHS AND RESOURCES IN THEIR TERRITORY THROUGH TIME

3 CIP-Gegevens Koninklijke Bibliotheek, Den Haag Vrieling, Lammert The Pathfinder. Strategy Paths and Resources in their Territory through Time / Lammert Vrieling. Capelle a/d IJssel: Labyrint Publication. University of Groningen; Theses on Systems, Organisations and Management. - With index, ref. With summary in Dutch. ISBN NUGI 684 Subject: Management Published by: Labyrint Publication P.O. Box AR Capelle a/d IJssel The Netherlands Lammert Vrieling, 1998 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the author. Printed by: Ridderprint, Ridderkerk

4 RIJKSUNIVERSITEIT GRONINGEN THE PATHFINDER STRATEGY PATHS AND RESOURCES IN THEIR TERRITORY THROUGH TIME PROEFSCHRIFT ter verkrijging van het doctoraat in de Bedrijfskunde aan de Rijksuniversiteit Groningen op gezag van de Rector Magnificus, dr. D.F.J. Bosscher, in het openbaar te verdedigen op donderdag 12 november 1998 om uur door LAMMERT VRIELING geboren op 26 april 1968 te Groningen

5 Promotor: Prof. dr. F. Haselhoff Referent: Dr. H. Sminia

6 PhD-panel (beoordelingscommissie): Prof. dr. ing. F.A.J. van den Bosch (Erasmus University, Rotterdam) Prof. dr. M.R. van Gils (University of Groningen) Prof. dr. A.M. Pettigrew (University of Warwick, U.K.)

7 THE PATHFINDER I TABLE OF CONTENTS TABLE OF CONTENTS...I PREFACE... V 1. STRATEGY: A ÒPATHFINDERÓ MISSION? RISE TO THE OCCASION The Bones Of Strategy : Decision And Choice The Flesh And Blood Of Strategy : Behaviour And Action The Focus: The Becoming Of Resources In Their Territory DEVELOPING THEORY Time Three Levels Of Analysis Potential Ability And Actual Practice Conclusions DEVELOPING METHOD DEVELOPING RESOURCES IN SHORT... A ÒPATHFINDERÓ MISSION ÒRESOURCESÓ IN THEIR TERRITORY INTRODUCTION THE RESOURCE-BASED VIEW Origins Of The Resource-Based View Two Schools Within The Resource-Based View A Resource-Based Vocabulary Resource-Based View Conclusions...31

8 II TABLE OF CONTENTS 3. THE FIRM-IN-SECTOR PERSPECTIVE Three Dimensions Of The Firm-In-Sector Perspective Developments Within The Firm-In-Sector Perspective A Firm-In-Sector Vocabulary Firm-In-Sector Conclusions LINKING LEVELS OF ANALYSIS The Coming Into Being Of A Firm s Resources Path Development CONCLUSIONS CONCERNING METHOD INTRODUCTION CONTEXTUALISM World Hypotheses And Corresponding Root Metaphors Contextualism Conclusions MANAGEMENT RESEARCH Strategy Process Research Process Theories METHODOLOGY Research Design Research Method Research Parameters Data Collection Analysis CONCLUSION KONINKLIJKE HOOGOVENS IN ITS TERRITORY: É INTRODUCTION THE WORLD OF STEEL... 89

9 THE PATHFINDER III 2.1 The Basics Of Steel Change And Continuity In Steel THE WORLD OF ALUMINIUM The Basics Of Aluminium Change And Continuity In Aluminium A BIRDÕS-EYE VIEW OF HOOGOVENS CONCLUSIONS THE ÒSOCIAL BECOMINGÓ OF KONINKLIJKE HOOGOVENS PLC INTRODUCTION TO BECOME IS TO INTERACT MAJOR EPISODES OF BECOMING The Formation Of A Producer Of Iron The Formation Of A Steel Producer The Formation Of A Producer Of Rolled Oxygen Steel The Formation Of A Large And Diversified Company The Formation Of A Complex And More Diversified Company The Formation Of A Two-Metal Company CONCLUSIONS RESOURCES AS THE ÒOUTPUTÓ OF SOCIAL BECOMING INTRODUCTION RESOURCE FORMATION Steel Resource Formation Aluminium Resource Formation Conclusions A COMPARATIVE VIEW Cross-Metal Comparison Comparison Across Time CONCLUSIONS

10 IV TABLE OF CONTENTS 7. WHAT HAVE WE LEARNT? ÒRESOURCESÓ IN THEIR TERRITORY OBJECTIVES OF THIS DISSERTATION RESEARCH QUESTIONS In What Way Do A Firm s Resources Emanate From The Firm? In What Way Are A Firm s Resources Enforced By The Sector? Resource Ability Resource Practice AT THE END OF THE DAY REFERENCES NAME INDEX SUMMARY IN DUTCH ENDNOTES...232

11 THE PATHFINDER V PREFACE Here s to the crazy ones. The misfits. The rebels. The troublemakers. The round pegs in the square holes. The ones who see things differently. They re not fond of rules. And they have no respect for the status quo. You can praise them, disagree with them, quote them, disbelieve them, glorify them or vilify them. About the only thing you can t do is ignore them. Because they change things. They invent. They imagine. They heal. They explore. They create. They inspire. They push the human race forward. Maybe they have to be crazy. How else can you stare at an empty canvas and see a work of art? Or sit in silence and hear a song that s never been written? Or gaze at a red planet and see a laboratory on wheels? [...] And it s the people who are crazy enough to think they can change the world, who actually do. i The more you study strategy processes through time and the more you see the stubbornness of routines and institutions within these processes, the more you will learn to value crazy people who think they can change a company... However, more difficult than merely changing situations is envisioning new possibilities of future situations. In 1943, Thomas Watson of IBM argued: I think there is a world market for maybe five computers. In 1977, Ken Olson of DEC said: There is no reason anyone would want a computer in their home. Today it is easy to ridicule these remarks but that is not fair because no mere human being can single-handily create the future. However, some people are clearly better at foreseeing a future, better at imagining a future. Is there a means to improving such a process? Unfortunately, formal management science does not really help. A Yale University management professor responded to Fred Smith s paper proposing reliable overnight delivery service: The concept is interesting and well-formed, but in order to earn better than a C, the idea must be feasible. Smith, nevertheless went on to found Federal Express. This dissertation does not present a holy grail but works to present a movie of strategy and resources in their territory, where men and matter, and i The Think different campaign of Apple Computers A tribute to innovative thought.

12 VI PREFACE time and tide will prove to be core. Many people have contributed to this project. I would like to thank my supervisor Frits Haselhoff for his commitment, investment and endurance. Thomas Edison once said: Most people fail to recognise opportunity, because it comes dressed in an overall and looks like work. Thanks for looking beyond my inadequacy and for bringing out the best in me. Harry Sminia, my mentor, provided a fruitful platform for discussion, criticism and ideas. Thanks Harry! The contribution of the steel and aluminium company Koninklijke Hoogovens plc has been tremendous. My boss at Hoogovens, Bim Bensdorp, is an original thinker - a crazy one - always concerned where in the strategy process people as well as the company are at. I am so grateful that he let me into his patch. Harry Derkx has been my mentor - are good mentors supposed to be called Harry? - critic, friend and buddy at Hoogovens. Of the many Hoogovens people who contributed to this project I like to mention Trudy de Leeuw, Irene Braham, Bert Gelsing, Betty Leijssius, Job van Wijngaarden, Rolf Vogel and his team, Maarten van Veen and the Board of managing directors. A special thank you for all (retired) Hoogovens people who showed me Hoogovens by telling their story. Based on their testimonies I have been able to present this movie. In 1997 I spent three months at the Centre for Corporate Strategy and Change of the Warwick Business School on invitation of Andrew Pettigrew. In spite of his busy schedule we had many conversations and every conversation with professor Pettigrew was a roller coaster ride providing many valuable ideas. I would like to thank John McGee and Ann Jackson, and also the Netherlands Foundation for Scientific Research (NWO) for making it financially possible. Furthermore, there are many others who have contributed to my PhD whom I like to mention here as well: Jan Arriens, Frans van den Bosch, Wytze Feringa, Ellen Flikkema, Maarten van Gils, Ed Postma, and Hans Wijers. Finally, the beauty of marriage is that it is God s gift of an intimate ally in the struggle of life. Writing a PhD has been a struggle indeed! Conny, my intimate ally, has been, still is and will always be the best partner I can imagine. We share together, plot our lifes together, and support each other in our common vision. Conny, thanks for your support! Lammert Vrieling July 1998