Performance forecasts in uncertain environments: Examining the predictive power of the VRIO-framework
AbstractStrategy tools are widely used in the practice of strategic management to yield a good solution with an acceptable problem-solving effort. This paper presents results of an experimental research project that assesses the practical effectiveness of a theory-based decision-making tool, the VRIO-Framework, in predicting the stock-market performance of different companies. The VRIO's predictive power is compared to the predictions derived from Analyst Ratings that are a widespread and commonly used tool in the decision-making context of this study. Our results suggest that the VRIO-Framework is a particularly effective forecasting tool whereas the power of Analyst Ratings is disputable. The results also provide support for the practical usefulness of resource-based theory. --
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Bibliographic InfoPaper provided by Free University Berlin, School of Business & Economics in its series Discussion Papers with number 2010/22.
Date of creation: 2010
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-01-23 (All new papers)
- NEP-CSE-2011-01-23 (Economics of Strategic Management)
- NEP-EXP-2011-01-23 (Experimental Economics)
- NEP-FOR-2011-01-23 (Forecasting)
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