Reconsidering the Reputation—Performance Relationship: A Resource-Based View

Abstract

Reputation is thought to differentiate organizations and help explain variability in their performance. A recent study contributed to knowledge about the reputation—performance relationship by depicting reputation as having two dimensions and linking each dimension to the prominence and performance of U.S. business schools. The authors propose an alternative approach that draws on the resource-based view (RBV) wherein reputation is an intangible asset that is composed of complementary and reinforcing relationships whose synergies create causal ambiguities that have positive performance implications. The authors also test a direct effect of faculty experience on prominence. Their results support the merit of the RBV model, indicating that it offers greater explanatory power. The findings suggest that reputation cannot be bought by additive and independent investments. Instead, enhancing a reputation requires managers to carefully nurture interdependencies and complex relationships. The findings also provide new insights about the determinants of business school reputation.