Competitive strategy and performance measurement in the Malaysian context

Ruzita Jusoh (Department of Management Accounting and Taxation, Faculty of Business and Accountancy, University of Malaya, Kuala Lumpur, Malaysia)
John A. Parnell (School of Business, University of North Carolina‐Pembroke, Pembroke, North Carolina, USA)

Management Decision

ISSN: 0025-1747

Publication date: 8 February 2008

Abstract

Purpose

The purpose of this paper is to contribute to a better understanding of competitive strategy and performance measurement in the Malaysian context by applying a modified version of Conant et al's generic strategy scale and categorizing Malaysian firms along the Miles and Snow business strategy typology.

Design/methodology/approach

Competitive strategy and performance measurement were assessed via survey. A total of 975 firms were randomly selected from the directory of Federation of Malaysian Manufacturers (FMM) as listed in 2003. Overall, 133 surveys were returned, 120 of which were usable for analysis.

Findings

Results suggest that Malaysian firms view competitive strategy differently and are more likely than their Western counterparts to emphasize the use of financial measures of organizational performance. Findings also highlight the difficulties faced when Western measurement scales are employed in non‐Western emerging nations.

Research limitations/implications

Because greater emphasis was placed on financial rather than non‐financial measures, results indicate a statistically significant different improvement only in sales growth and ROI performance among the three strategy categories. Strategy researchers should focus their attention to the use of multiple performance measures in assessing firm's performance as shown by the significant different in the use of customer satisfaction and loyalty measures, as well as employee satisfaction and training measures.

Originality/value

These findings hold relevance for executives responsible for the formulation and implementation of business strategy. A better understanding of the relationship between business strategy and performance measures using the BSC perspectives of measures has been provided. The study provides some useful insights into the role of performance measures. In addition, this study conveys the message to top managers and designers of performance measurement tools–most notably the balanced scorecard– should pay particular attention to non‐financial performance measures in implementing their organization's strategy.

Keywords

Citation

Jusoh, R. and Parnell, J. (2008), "Competitive strategy and performance measurement in the Malaysian context", Management Decision, Vol. 46 No. 1, pp. 5-31. https://doi.org/10.1108/00251740810846716

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Publisher

:

Emerald Group Publishing Limited

Copyright © 2008, Emerald Group Publishing Limited

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