Strategy and Capabilities in the P-form Corporation: Linking Strategic Direction with Organizational Capabilities

There has been a growing interest in the field of strategic management to understand the relationship between the organizational capabilities of firms and (a) the direction of strategies pursued and (b) the impact on competitive performance. Much of this literature has been influenced by the resource-based view of the firm. As indicated in early formulations of this theory, one implication is that the organization of resources is equally important as the resources themselves. Accordingly, the organizational and integration of resources and knowledge can be viewed as a core facet of the organizational capabilities of firms that are difficult to imitate for competitors. This paper explores a particular kind of organization referred to as the “P-form corporation” (Project-Form), its organizational capabilities and options for strategic alternatives. The chapter addresses three broad questions: (1) What are the main characteristics of P-form corporations? (2) What are the capabilities acquired and developed by P-form corporations and how are these acquired? (3) How do these capabilities vary across different strategic alternatives in the P-form corporation? The chapter concludes with a discussion about the implications for strategy and management.