Resource Commitment and Cost Behavior Under Different Strategies

Simple item page
atmire.migration.oldid5827
dc.contributor.advisorAnderson, Mark
dc.contributor.authorYu, Zhimin
dc.contributor.committeememberHerremans, Irene
dc.contributor.committeememberMashruwala, Raj
dc.contributor.committeememberTanaka, Atsuko
dc.contributor.committeememberNatarajan, Ram
dc.date.accessioned2017-08-04T15:55:39Z
dc.date.available2017-08-04T15:55:39Z
dc.date.issued2017
dc.date.submitted2017en
dc.description.abstractI analyze asymmetric cost behavior from the perspective of resource commitment made to support strategic positions. Previous studies of asymmetric cost behavior consider how managers’ expectations about future demand in relation to costs of adjusting resources affect cost stickiness. My studies focus on how managers’ resource commitments made for strategic reasons affect cost behavior, and how cost stickiness as evidence of commitment to strategy is associated with firm performance. My first study investigates how resource commitment or resource flexibility reflected in cost stickiness is related to firm performance under different generic strategies. I interpret higher cost stickiness as evidence of commitment to a differentiation strategy and find that intangible value (measured by Tobin’s Q) associated with differentiation increases with cost stickiness. I also find that the persistence of return on assets (ROA) increases with cost stickiness for differentiators. My second study examines stickiness of SG&A costs as a consequence of resource commitments made to support a customer-focused strategy reflected in higher customer satisfaction. I find that customer satisfaction increases with both the intensity and stickiness of SG&A costs. I also document that the positive relation between intangible value and customer satisfaction increases with cost stickiness. My third study focuses on the airline industry in order to gain further insights about the roles of strategy and operations in determining cost behavior. In the airline industry, full service carriers (FSCs) employ clearly distinctive operating strategies from low cost carriers (LCCs). Resource complementarity is important to FSCs whose strategy depends on combinations of resources that enable high levels of service but resource flexibility is important to LCCs whose strategic goals are to minimize costs in both up and down markets. I use revenue passenger miles (RPMs) flown as the primary cost driver to separate the influence of volume changes from price changes on the empirical analysis. I find that operating costs, number of employees, and number of flights all exhibit stickiness for FSCs but not for LCCs.  en_US
dc.identifier.citationYu, Z. (2017). Resource Commitment and Cost Behavior Under Different Strategies (Doctoral thesis, University of Calgary, Calgary, Canada). Retrieved from https://prism.ucalgary.ca. doi:10.11575/PRISM/27646en_US
dc.identifier.doihttp://dx.doi.org/10.11575/PRISM/27646
dc.identifier.urihttp://hdl.handle.net/11023/4003
dc.language.isoeng
dc.publisher.facultyGraduate Studies
dc.publisher.institutionUniversity of Calgaryen
dc.publisher.placeCalgaryen
dc.rightsUniversity of Calgary graduate students retain copyright ownership and moral rights for their thesis. You may use this material in any way that is permitted by the Copyright Act or through licensing that has been assigned to the document. For uses that are not allowable under copyright legislation or licensing, you are required to seek permission.
dc.subjectEducation--Business
dc.subject.otherCost Behavior
dc.titleResource Commitment and Cost Behavior Under Different Strategies
dc.typedoctoral thesis
thesis.degree.disciplineManagement
thesis.degree.grantorUniversity of Calgary
thesis.degree.nameDoctor of Philosophy (PhD)
ucalgary.item.requestcopytrue
Files
Collections
Open Theses and Dissertations