Resource Dependency Theory

Topics: Sony, Dependency theory, Video Pages: 1 (265 words) Published: October 19, 2010
Resource dependency theory argues that the “goal of an organization is to minimize its dependence on other organizations for the supply of scare resources in its environment and to find ways to influence them to secure needed resources” (Jones, 2010). There are two basic types of interdependencies: symbiotic and competitive (Jones, 2010). In the case of the video format war, the different organizations were competing for: customers/market share; deals with motion picture companies (, 2010a); and to produce the most efficient VCR in order to, ultimately, become the industry standard (, 2010a). This, therefore, means that the relevant interdependency in the video format war is that of competitive interdependency, where organizations are competing for scare inputs and outputs. Sony clearly did not adequately anticipate these interdependencies because it failed to: •properly anticipate resistance stemming from the motion picture industry and to broker deals with motion picture companies (, 2010c) •form strategic alliances with other companies to support Betamax’s format before production; thus, making Sony inflexible because altering the design of its VCR would require expensive changes to its manufacturing equipment (Cusumano, Mylonadis and Rosenbloom, 1992) •take into account was what the consumers wanted; Sony believed that what they wanted were better quality recordings. However, instead of better quality recordings, what consumers wanted were longer recording time, and compatibility for easy transfers of videos (, 2010b) •spend more time on research and development; instead Sony tried to save money by picking a version of technology it thought would do best without really exploring all the options (, 2010b)
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