The Role of Adaptive Decision Making in Resource Choices among SMEs

Glenn A. Metts


DOI: 10.2190/CN.32.2.b

Abstract

This article explores the relationship between adaptive decision making and the ability of a firm to acquire certain competitively valuable human resources (HR). The characteristics of these human resources include organizational capabilities, marketing capabilities, and technological capabilities. This research tests the hypothesis that in smaller firms the negotiating mechanism that determines which resources are acquired and developed is bounded by the decision-making process of the organization's top management. The research model is tested using structural equation modeling, and the results indicate that adaptive decision making is one of the processes which drives the emphasis and selection of competitively valuable resources in small and medium-sized enterprise (SME) manufacturing environments. The hypothesized positive direct effect of adaptive decision making on the level of internal resources and capabilities is strongly supported.

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