Divestiture decisions: conceptualization through a strategic decision-making lens

Abstract

Research on corporate divestitures lacks a systematic understanding of how the divestiture process influences divestiture outcomes. This study reviews the relevant literature and offers conceptual insights into decision making, a fundamental aspect of the process, in the context of corporate divestitures. A framework based on the general strategic decision-making research is developed and then applied to a comprehensive and traceable discussion of the literature. The review strongly indicates that differences among decision-making processes can explain why corporations facing similar conditions make very different divestiture decisions, leading to different outcomes. However, this study also reveals considerable variances in maturity and conclusiveness among the concepts reviewed, such as the interdependencies among decision-making characteristics, contexts, and effectiveness. In consequence, suggestions for further research are provided.