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Article
Publication date: 9 October 2017

Anders Pehrsson

The study draws on the resource-based view and the contingency view of strategy. The purpose of this paper is to contribute to international strategy literature by extending the…

Abstract

Purpose

The study draws on the resource-based view and the contingency view of strategy. The purpose of this paper is to contribute to international strategy literature by extending the current understanding of foreign subsidiary’s competitive strategy in terms of cost leadership and product differentiation.

Design/methodology/approach

Hypotheses concern associations between corporate support building on product and skills relatedness and subsidiary strategies. Also, it is hypothesized that strategies are due to the type of local competitive intensity. The hypotheses were tested on wholly owned subsidiaries of Swedish industrial firms in Germany, the UK and the USA.

Findings

Product and skills relatedness between the subsidiary and the corporate core unit are positively associated with the subsidiary’s emphasis on cost leadership. Also, a positive association was found between skills relatedness and product differentiation, and extensive competitive intensity strengthens the relationship.

Research limitations/implications

The study specifies what business relatedness is needed for a subsidiary’s competitive strategy; skills relatedness is more important than product relatedness; the type of local competitive intensity is important; corporate support and local strategy operate simultaneously.

Practical implications

Management is advised to implement a foreign subsidiary’s competitive strategy by recognizing the mechanisms identified in this study.

Originality/value

In a unique way, the study captures the role of corporate support of a foreign subsidiary’s competitive strategy relying on business relatedness and the importance of aligning the strategy with competitive intensity.

Details

European Business Review, vol. 29 no. 6
Type: Research Article
ISSN: 0955-534X

Keywords

Article
Publication date: 2 October 2017

Ahmad Herzallah, Leopoldo J. Gutierrez-Gutierrez and Juan Francisco Munoz Rosas

The purpose of this paper is to examine the relationship between quality ambidexterity (QAMB), competitive strategies (cost leadership, differentiation, and focus), and firm…

1835

Abstract

Purpose

The purpose of this paper is to examine the relationship between quality ambidexterity (QAMB), competitive strategies (cost leadership, differentiation, and focus), and firm performance in Palestinian industry, and to analyze the combination of quality exploitation (QEI) and quality exploration (QER) (QAMB) associated with the different levels of each competitive strategy.

Design/methodology/approach

Using data collected through a survey of 205 Palestinian industrial firms, the study conducted structural equation modeling to test the proposed relationships. Additional statistical analyses were applied to the combinations of QEI and QER for each competitive strategy.

Findings

The results show a positive and significant relationship between QAMB and three competitive strategies, and between competitive strategies and financial performance, focus strategy excepted. Balanced combination with similar levels of QEI and QER is found to be more suitable for higher levels of competitive strategies implementation, whereas an excess of QER over QEI is associated with lower levels of strategies implementation.

Research limitations/implications

Although Palestine has two regions, the West Bank and the Gaza Strip, all survey respondents were from the West Bank. The data used in this study come from the industrial sector only.

Originality/value

This study is the first empirical test to examine the impact of QAMB on financial performance through competitive strategies. The study results may help managers to implement QEI and QER practices in order to allocate resources effectively and ultimately improve financial performance.

Details

International Journal of Operations & Production Management, vol. 37 no. 10
Type: Research Article
ISSN: 0144-3577

Keywords

Article
Publication date: 7 October 2014

Christian Felzensztein and Eli Gimmon

This study aims to focus on how companies operating in international food commodity markets can improve their long-term competitiveness and profitability upon financial pressure…

2231

Abstract

Purpose

This study aims to focus on how companies operating in international food commodity markets can improve their long-term competitiveness and profitability upon financial pressure. Management can choose between generic strategies of either cost leadership or enhanced value adding by differentiation and innovative marketing strategies. The aim of the paper is to highlight key findings from a case study perspective.

Design/methodology/approach

The research is set within the farmed salmon sector in the world’s second largest producing country, Chile, which is also a fast growing emerging economy in Latin America. Semi-structured personal interviews were conducted with General Managers of this global industry.

Findings

Unexpectedly, our findings show that executives preferred competitive strategy of cost reduction rather than differentiation. Based on previous research, we recommend managers of individual firms and trade associations to play down commoditisation and to pursue differentiation strategies with particular attention to emergent environmental attributes.

Originality/value

Practitioners from Latin America may learn on empirical considerations of international marketing strategies taking this competitive global industry as an example. An overall cost leadership strategy is not sufficient in a mature industry, and customer-oriented strategies are needed more than production-oriented strategies. Clustered firms are recommended to benefit from differentiation strategies with particular attention to emergent environmental attributes.

Details

European Business Review, vol. 26 no. 6
Type: Research Article
ISSN: 0955-534X

Keywords

Article
Publication date: 1 February 1993

K.C. Chan

The ideas expressed in this work are based on those put intopractice at the Okuma Corporation of Japan, one of the world′s leadingmachine tool manufacturers. In common with many…

1571

Abstract

The ideas expressed in this work are based on those put into practice at the Okuma Corporation of Japan, one of the world′s leading machine tool manufacturers. In common with many other large organizations, Okuma Corporation has to meet the new challenges posed by globalization, keener domestic and international competition, shorter business cycles and an increasingly volatile environment. Intelligent corporate strategy (ICS), as practised at Okuma, is a unified theory of strategic corporate management based on five levels of win‐win relationships for profit/market share, namely: ,1. Loyalty from customers (value for money) – right focus., 2. Commitment from workers (meeting hierarchy of needs) – right attitude., 3. Co‐operation from suppliers (expanding and reliable business) – right connections., 4. Co‐operation from distributors (expanding and reliable business) – right channels., 5. Respect from competitors (setting standards for business excellence) – right strategies. The aim is to create values for all stakeholders. This holistic people‐oriented approach recognizes that, although the world is increasingly driven by high technology, it continues to be influenced and managed by people (customers, workers, suppliers, distributors, competitors). The philosophical core of ICS is action learning and teamwork based on principle‐centred relationships of sincerity, trust and integrity. In the real world, these are the roots of success in relationships and in the bottom‐line results of business. ICS is, in essence, relationship management for synergy. It is based on the premiss that domestic and international commerce is a positive sum game: in the long run everyone wins. Finally, ICS is a paradigm for manufacturing companies coping with change and uncertainty in their search for profit/market share. Time‐honoured values give definition to corporate character; circumstances change, values remain. Poor business operations generally result from human frailty. ICS is predicated on the belief that the quality of human relationships determines the bottom‐line results. ICS attempts to make manifest and explicit the intangible psychological factors for value‐added partnerships. ICS is a dynamic, living, and heuristic‐learning model. There is intelligence in the corporate strategy because it applies commonsense, wisdom, creative systems thinking and synergy to ensure longevity in its corporate life for sustainable competitive advantage.

Details

Industrial Management & Data Systems, vol. 93 no. 2
Type: Research Article
ISSN: 0263-5577

Keywords

Article
Publication date: 28 September 2010

Qiang Wang, Baofeng Huo, Fujun Lai and Zhaofang Chu

The paper's aim is to replicate and compare Huo et al.'s study to better understand performance drivers of third‐party logistics (3PL) in mainland China and to disseminate Hong…

2468

Abstract

Purpose

The paper's aim is to replicate and compare Huo et al.'s study to better understand performance drivers of third‐party logistics (3PL) in mainland China and to disseminate Hong Kong 3PL providers' experience to mainland China's peers.

Design/methodology/approach

A structural model is estimated to test the construct relationships using data collected from 105 mainland China's 3PL providers. The results are compared with the results of Huo et al.'s study of Hong Kong 3PL providers.

Findings

While the operations emphasis of low cost may still be effective for mainland China's 3PL providers, it may result in worse financial performance for Hong Kong 3PL providers. In mainland China, lowcost emphasis is affected by local competition, but not by operational challenges, while it is influenced by both local competition and operational challenges in Hong Kong. Operational challenges have a positive impact on lowcost emphasis in Hong Kong, but no impact in mainland China.

Originality/value

The study enriches the literature on China's logistics and provides mainland China's 3PL managers valuable insights from the business practices of their Hong Kong peers.

Details

Industrial Management & Data Systems, vol. 110 no. 9
Type: Research Article
ISSN: 0263-5577

Keywords

Article
Publication date: 25 January 2022

Manjeet Kharub, Rahul S. Mor and Sudhir Rana

This paper examines the mediating role of manufacturing strategies in the relationship between competitive strategies and firm performance.

1491

Abstract

Purpose

This paper examines the mediating role of manufacturing strategies in the relationship between competitive strategies and firm performance.

Design/methodology/approach

This study gathered 250 responses from firms in a developing country's key manufacturing sectors, including mechanical, electronics, automotive, textile and food. First, descriptive statistics were applied to fix outliers like respondent biases, missing values and normality issues. Second, exploratory factors analysis (EFA) ensured data adequacy and homogeneity through Kaiser–Meyer–Olkin (KMO) and Bartlett tests. Finally, confirmatory factors analysis (CFA) was used to identify the interactions (direct, indirect and total effects) between latent variables representing manufacturing strategies (quality, cost, delivery and flexibility), competitive strategies (cost-leadership and differentiation) and firms' performance (sales growth and profitability). In total, two structural equation modelling (SEM) models (SEM-I, SEM-II) were created to test the hypotheses.

Findings

Of the 40 items identified by the literature review, four were outliers, and three could not satisfy the EFA criteria (eigenvalue >1). Only 33 items could therefore reach CFA. SEM–I and SEM-II study results found no direct relationship between competitive strategies and firm performance (−0.03 = β = 0.08; p > 0.05). However, the findings revealed that cost-leadership could be an appropriate strategic choice and improved firms' performance if the quality and delivery are focussed (0.20 = β = 0.87; p < 0.001). While competitive strategies impact manufacturing strategies positively, the latter is only a mediator between the cost-leadership strategy and the firms' performance.

Originality/value

This research shows that the cost-leadership approach currently seems viable; however, flexibility and cost requirements were not satisfied due to infeasible product differentiation. These results will be beneficial to executives interested in investing in India's industries.

Details

Benchmarking: An International Journal, vol. 29 no. 10
Type: Research Article
ISSN: 1463-5771

Keywords

Article
Publication date: 1 December 2006

Qiang Wang, Kenneth Zantow, Fujun Lai and Xiaodong Wang

To examine the strategic posture of third‐party logistics (3PLs) providers in mainland China.

5956

Abstract

Purpose

To examine the strategic posture of third‐party logistics (3PLs) providers in mainland China.

Design/methodology/approach

A sample survey, obtained by mail, of 3PLs firms in mainland China. Key informant data are used to operationalize Porter's competitive strategy and provides a framework to identify logistics strategies pursued by 3PLs providers. Various aspects of 3PLs providers are compared by different strategy types.

Findings

Identified four logistics strategies pursued by 3PLs providers in mainland China. Differentiation strategy outperforms cost leadership strategy. Companies pursuing cost leadership are shifting towards differentiation strategy to cope with the intense competition faced in mainland China's immense logistics markets.

Research limitations/implications

Bias may exist due to the mail survey. In‐depth studies on strategy formulation of 3PLs providers could be carried out to examine what factors influence the strategy formulation and explore the strategy evolution path.

Practical implications

This study is a very insightful source of information about 3PLs in mainland China for logistics managers, investors and policy‐makers. It provides guidance for 3PLs executives to formulate logistics strategy, adjust business objectives and prioritize operations, and for logistics users to select appropriate logistics providers. There are also suggestions for government to improve the business environment for the logistics industry. The study provides a basis for research on logistics management in mainland China.

Originality/value

This study is a pioneer and comprehensive study of mainland China's 3PLs providers. To the best of our knowledge, this is the first study to examine 3PLs providers in mainland China.

Details

International Journal of Physical Distribution & Logistics Management, vol. 36 no. 10
Type: Research Article
ISSN: 0960-0035

Keywords

Article
Publication date: 1 March 2006

Jeff Hoi Yan Yeung, Willem Selen, Chee‐Chuong Sum and Baofeng Huo

Aims to investigates the relationship of strategic choices of pure cost‐, pure differentiation‐, or a combination‐strategy on a composite measure of financial performance for…

5405

Abstract

Purpose

Aims to investigates the relationship of strategic choices of pure cost‐, pure differentiation‐, or a combination‐strategy on a composite measure of financial performance for third‐party logistics (3PL) providers in Hong Kong. In addition, it seeks to identify the importance of operations priorities underlying the respective adopted strategy, as well as the importance given to future competitive challenges for each strategy.

Design/methodology/approach

Uses cluster analysis, ANOVA.

Findings

Logistics service providers classified to follow different strategies report different financial performance, with companies adhering to the combined strategy of cost and differentiation performing best, followed by pure differentiation companies, which in turn outperform pure cost‐, commodity driven‐companies.

Research limitations/implications

Future research may be widened to include customer, and not solely competitor, perceptions. Further studies could elaborate on technology adoption, information sharing, strategy formulation, operations practices, and benchmarking. Other studies could focus on the differences between high and low performers in terms of business performance, and the processes that enable low performers to become high performers; as well as comparing logistics strategies and practices between different countries.

Practical implications

Third‐party logistics providers, solely competing on cost and offering basic services only, need to differentiate to gain improved financial performance. Logistics companies can improve along multiple operational dimensions to achieve competitive advantage in the marketplace. Research identifies operational areas to be emphasized to drive strategy according to strategic orientation, as well as generic factors that will drive future logistics management in Hong Kong.

Originality/value

Linking perceived financial performance to strategic choices of pure cost‐, pure differentiation‐, or a combination‐strategy for 3PL providers in Hong Kong.

Details

International Journal of Physical Distribution & Logistics Management, vol. 36 no. 3
Type: Research Article
ISSN: 0960-0035

Keywords

Article
Publication date: 1 January 1991

Byron Sharp

In this article which is based on a marketing analysis of MichaelPorter′s definition of competitive strategies, the confusion present inmarketing and strategic management texts as…

10229

Abstract

In this article which is based on a marketing analysis of Michael Porter′s definition of competitive strategies, the confusion present in marketing and strategic management texts as to the definitions of the three strategies of low cost, differentiation and focus is noted. The idea that using price to differentiate means a firm is using a low cost strategy is dismissed and the value of a definition of focus strategy as merely some degree of extreme differentiation is questioned. New definitions of the three strategies are proposed which are based upon the idea that firms react to, and take actions which influence, the structure of the market in which they operate. They influence market structure through determining the market′s proximity level ‐the minimum level of marketplace performance which a firm must reach in order to compete across the broad marketplace. If a firm has the ability to reach this level and go further to excel in the provision of one or more benefits, it can implement a differentiation strategy. Alternatively, it can attempt to lift the market′s proximity level or partake in imitative activity, which reduces the potential bases for differentiation in the market, a low cost strategy (only sensible for the firm with the lowest costs of production). If a firm lacks the ability to reach the proximity level, it must seek segments which do not require reaching proximity in order to serve them, a focus strategy.

Details

Marketing Intelligence & Planning, vol. 9 no. 1
Type: Research Article
ISSN: 0263-4503

Keywords

Article
Publication date: 1 August 1995

William A. Drago

Popularity of the resource‐based theory of the firm has brought renewed interest in internal organisational domain as an important contributing factor toward organisational…

Abstract

Popularity of the resource‐based theory of the firm has brought renewed interest in internal organisational domain as an important contributing factor toward organisational success. Generally, this research has taken the perspective that a direct link exists between internal domain and performance. An underlying premise of this view is that competitive direction is simply a reflection of the parameters of this domain. This study investigates the strength and direction of the link between internal domain and competitive direction to determine the significance of this assertion.

Details

Management Research News, vol. 18 no. 8/9
Type: Research Article
ISSN: 0140-9174

11 – 20 of over 15000