Strategic Management Journal 1991

Successful bear‐fighting strategies

Hein Schreuder¹; Patrick Van Cayseele^2,3; Patrick Jaspers⁴; B de Graaff⁴

¹ European Institute for Advanced Studies in Management · ² United Nations University – Maastricht Economic and Social Research Institute on Innovation and Technology · ³ KU Leuven · ⁴ National Investment Bank, The Hague, The Netherlands

Abstract

This paper explores the factors involved in determining the differential performance of firms in bear markets. Bear markets are identified at the industry level by employing the criterion of a 20 percent drop of the industrial value added index over a period of at least 3 years. Twenty‐one matched pairs of Dutch firms which have experienced such bear markets (one successful, the other unsuccessful), are analyzed. The dominant finding is that successful firms follow market‐oriented strategies, whereas their unsuccessful counterparts are distinguished by their focus on costs. Success, however, is a multifaceted phenomenon. Differences in initial conditions, in other types of strategic measures, in energy levels and in timing are also involved. The findings are related to the literatures on decline, failure, turnaround and transformation.

DOI

10.1002/smj.4250120705

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