Date of Award


Document Type

Dissertation - Rollins Access Only

Degree Type


Degree Name

Doctor of Business Administration (DBA)


Dr. Robert Prescott

Second Advisor

Dr. Halil Kiymaz


This study investigates the relationship between corporate asset deployment strategies and firm performance in the presence of contracting markets and assesses those strategies having the greatest performance impact. Leveraging two categories of firms (high and low recessionary exposure) within the defense industry during the 2011 to 2015 defense market contraction, various retrenchment, investment, and combined strategies were assessed against firm performance. Correlation and multivariate regression analysis was performed within a longitudinal design to assess five primary and two moderator hypotheses.

The study offers three significant findings expanding the body of research. First, distinctly different patterns emerge when comparing those firms having high levels of defense/recessionary exposure to those firms having lower levels. Firm performance amongst the high exposure group is most related to the generation of free cash flow and dividend payouts, whereas firm performance amongst the low exposure group is most related to capital investment. Second, the importance of capital investment changes vi during different phases of the recessionary period. High defense exposure firms significantly reduced capital investment levels in favor of returning cash to the shareholder during the early phase of the contraction. However, during the latter phase of the contraction, capital investment levels increased, trending closely with overall performance. Conversely, those firms having low defense exposure did not demonstrate as strong a relationship between free cash flow and performance. Instead, their use of cash for capital investment purposes was consistently associated with firm performance throughout the recessionary window. Finally, the direct contribution of merger and acquisition (M&A) and divestiture activities to firm performance was quite modest and actually tended to negatively impact performance. This suggests that more importance should be attached to generation of cash, payouts, and organic capital investment strategies. These findings may be further assessed in future research by extending the analysis into other industries and recessionary periods.

Because market contractions reflect very real and often deleterious conditions for business leaders, guidance is necessary for these leaders to survive and grow the firm. Through the assessment of specific asset deployment strategies and their resultant effectiveness, this analysis advances the body of knowledge and is applicable to both theory and practice.