Managerial rationales for investing and divesting under uncertainty

This study examines the strategic investment and divestment decisions of fifteen Norwegian power companies that were made in response to an increasingly uncertain business environment. The objective is to investigate the rationales underlying decisions for strategic renewal through the lens of real...

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Autores principales:	Rikke S. Platou, Arild Aspelund
Formato:	article
Lenguaje:	EN
Publicado:	Taylor & Francis Group 2019
Materias:	real options strategic decision-making managerial rationales strategic renewal uncertainty incumbents power companies Business HF5001-6182 Management. Industrial management HD28-70
Acceso en línea:	https://doaj.org/article/cd27f53921a24ec186d94415e6571bdf
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id	oai:doaj.org-article:cd27f53921a24ec186d94415e6571bdf
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spelling	oai:doaj.org-article:cd27f53921a24ec186d94415e6571bdf2021-12-02T16:42:11ZManagerial rationales for investing and divesting under uncertainty2331-197510.1080/23311975.2019.1685426https://doaj.org/article/cd27f53921a24ec186d94415e6571bdf2019-01-01T00:00:00Zhttp://dx.doi.org/10.1080/23311975.2019.1685426https://doaj.org/toc/2331-1975This study examines the strategic investment and divestment decisions of fifteen Norwegian power companies that were made in response to an increasingly uncertain business environment. The objective is to investigate the rationales underlying decisions for strategic renewal through the lens of real options logic. The qualitative analysis of 68 decisions allowed for an in-depth understanding of the multiple considerations top managers of energy companies deliberate prior to making strategic directive decisions. Findings show that uncertainty triggers diversification and that companies tend to move unidirectionally. However, the underlying rationales and determinants for strategic decisions vary considerably among the companies examined in this study—from deliberate, long-sighted strategic visions to opportunistic, short-sighted gut feelings. Further, boards of directors and owners exert some influence on top managers’ strategic decisions to expand their business activities. Knowing that some arguments carry more influence is important for managers who attempt to steer companies through turbulent times successfully.Rikke S. PlatouArild AspelundTaylor & Francis Grouparticlereal optionsstrategic decision-makingmanagerial rationalesstrategic renewaluncertaintyincumbentspower companiesBusinessHF5001-6182Management. Industrial managementHD28-70ENCogent Business & Management, Vol 6, Iss 1 (2019)
institution	DOAJ
collection	DOAJ
language	EN
topic	real options strategic decision-making managerial rationales strategic renewal uncertainty incumbents power companies Business HF5001-6182 Management. Industrial management HD28-70
spellingShingle	real options strategic decision-making managerial rationales strategic renewal uncertainty incumbents power companies Business HF5001-6182 Management. Industrial management HD28-70 Rikke S. Platou Arild Aspelund Managerial rationales for investing and divesting under uncertainty
description	This study examines the strategic investment and divestment decisions of fifteen Norwegian power companies that were made in response to an increasingly uncertain business environment. The objective is to investigate the rationales underlying decisions for strategic renewal through the lens of real options logic. The qualitative analysis of 68 decisions allowed for an in-depth understanding of the multiple considerations top managers of energy companies deliberate prior to making strategic directive decisions. Findings show that uncertainty triggers diversification and that companies tend to move unidirectionally. However, the underlying rationales and determinants for strategic decisions vary considerably among the companies examined in this study—from deliberate, long-sighted strategic visions to opportunistic, short-sighted gut feelings. Further, boards of directors and owners exert some influence on top managers’ strategic decisions to expand their business activities. Knowing that some arguments carry more influence is important for managers who attempt to steer companies through turbulent times successfully.
format	article
author	Rikke S. Platou Arild Aspelund
author_facet	Rikke S. Platou Arild Aspelund
author_sort	Rikke S. Platou
title	Managerial rationales for investing and divesting under uncertainty
title_short	Managerial rationales for investing and divesting under uncertainty
title_full	Managerial rationales for investing and divesting under uncertainty
title_fullStr	Managerial rationales for investing and divesting under uncertainty
title_full_unstemmed	Managerial rationales for investing and divesting under uncertainty
title_sort	managerial rationales for investing and divesting under uncertainty
publisher	Taylor & Francis Group
publishDate	2019
url	https://doaj.org/article/cd27f53921a24ec186d94415e6571bdf
work_keys_str_mv	AT rikkesplatou managerialrationalesforinvestinganddivestingunderuncertainty AT arildaspelund managerialrationalesforinvestinganddivestingunderuncertainty
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Managerial rationales for investing and divesting under uncertainty

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