TITLE

Reasoning About Competitive Reactions: Evidence from Executives

AUTHOR(S)
Montgomery, David B.; Moore, Marian Chapman; Urbany, Joel E.
PUB. DATE
January 2005
SOURCE
Marketing Science;Winter2005, Vol. 24 Issue 1, p138
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
Much of the empirical research on competitive reactions describes how or why rivals react to a firm's past actions, but stops short of examining whether managers attempt to predict such reactions, which we call strategic competitive reasoning. In three exploratory studies, we find evidence of managers' thinking about competitors' past and future behavior, but little incidence of strategic competitive reasoning. Competitive intelligence experts and other experienced managers' assessment of the results suggests that the relatively low incidence of strategic competitor reasoning is due to perceptions of low returns from anticipating competitor reactions more than to the high cost of doing so. Both the difficulty of obtaining competitive information and the uncertainty associated with predicting competitor behavior contribute to these perceptions. The paper suggests both a need for research on competitive behavior and an opportunity to influence and improve managerial judgment and decision making.
ACCESSION #
16384186

 

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