Search results

Unprecedented changes sweeping the world during the last few years have given rise to the need for the development and adoption of contingency strategies. This requires firms to have strategic flexibility in every aspect of their operation. Vendor development strategies constitute an important component in achieving this flexibility. Attempts to draw up an explicit conceptual link between generic business unit strategies and generic vendor development strategies. Proposes a vendor structure framework with three dimensions representing vendor structure scope, vendor structure relationship and vendor structure focus. Uses the framework to develop certain generic vendor development strategies. Considers the four generic strategies suggested by Porter, namely industry‐wide cost leadership strategy, industry‐wide differentiation strategy, segment cost leadership strategy and segment differentiation strategy and, for each one of these, proposes appropriate vendor development strategies.

This study introduces and tests strategic diversity as a mechanism for examining the strategy/structure fit in multinational corporations (MNCs). Strategic diversity is operationalized based on Galbraith and Kazanjian's (1986) framework that used a modified value‐added chain and center of gravity concept to explain diversity as a measure of the firm's movement from and around its original center of gravity. The results indicate that strategic diversity is a valid predictor of MNC organizational structure and may be more relevant for issues of strategy/structure fit in firms with international interests than the traditional measures of diversification. Future research in this area must consider the implications of strategic diversity for issues of strategy/structure fit by examining the effect of strategic diversity on both specific measures of strategy implementation and broad measures of overall economic performance.

The purpose of this paper is to provide a framework to help the manufacturer and the giant retailer to obtain optimal service level, pricing strategy, and market structure in order to maximize their respective profits.

A profit‐maximization model is developed to determine the optimal service level, pricing strategy, and market structure for supply chain players.

Using a profit‐maximization model, it is demonstrated that optimal service level and pricing strategy exist under different market structures in a manufacturer‐giant retailer supply chain. In order to maximize their respective profits, the manufacturer and the giant retailer should cooperatively employ a coordinative market structure as an optimal market structure and a bargaining model can be utilized to implement profit sharing for the manufacturer and giant retailer to optimize their profits. Furthermore, it is also shown that the value of coordinative structure always increases with the customers' sensitivity of service, the number of customers preferring to purchase from giant retailer, and the decreasing price sensitivity.

The study assumes that all supply chain players have perfect market information. However, market information to the supply chain players could be incomplete and asymmetric. It is recommended that future research explores optimal service level and pricing strategy under incomplete and asymmetric information setting.

The paper provides a very useful model framework to study optimum service level, pricing strategy, and market structure for business managers who are working in the manufacturer‐giant retailer supply chain.

The paper fills a conceptual and practical gap for a structured analysis of the current state of knowledge about service level, pricing strategy, and market structures in a manufacturer‐giant retailer supply chain. The paper provides practical, solid advice and business examples that demonstrate the application of the optimal strategies for supply chain management.

Zahra and Covin (1995, p. 46) report that “the current interest in corporate entrepreneurship arises from its potential usefulness as a means for renewing established organizations and increasing their ability to compete in their chosen markets.” In addition, a number of researchers support a contention made by Schollhamer (1982, p. 82), that “corporate entrepreneurship is a key element for gaining competitive advantage and consequently greater financial strength” (Covin & Slevin, 1991; Peters & Waterman, 1982; Zahra & Covin, 1995). Interestingly, however, other researchers argue that corporate entrepreneurship can be risky and may be detrimental to a firm’s short-term financial performance (Burgelman & Scales, 1986; Fast, 1981).

Many researchers and executives have viewed fit as a key to organizational survival and high performance (Summer et al., 1990). However, the type of fit and how it can be best achieved may often be in question (Venkataraman, 1989). The current study empirically examines both external and internal fit as predictors of firm performance where: (1) external fit is the alignment of, or congruence between, the organization's strategy and/or structure and the task environment, and (2) internal fit is the multidimensional matching of strategy with structure. The argument presented here is that both internal and external fit can, and do, occur simultaneously. Further, the presence of one type of fit may compensate for deficiencies in the other. Using fit in terms of both matching and moderation, hypotheses are tested to determine the nature of both internal and external fit of strategy and structure. Testing of the hypotheses is conducted using data from the medical group industry. Findings support the influence of individual strategy and structure variables on medical group performance. However, fit found between strategy and structure, be it as matching or moderation, shows little influence on performance. Implications for medical groups and the broader health care industry are discussed.

Matrix structures are complex and conflict prone, so multinational enterprises (MNEs) would utilize them only if they conferred some advantage over less complex organizational structures. Based upon the information-processing view, a theory of matrix advantage is proposed. It is supported by a secondary analysis of data from a major study of German MNEs. Matrix structures are shown to have an advantage over the elementary structural types. Specifically, the matrix structures fit higher levels of transnational strategy than elementary structures. Transnational strategy is assessed by two concepts: firm internationalization (involvement in foreign sales, manufacturing, and research and development (R&D)) and corporate integration (intracompany transfers). Moreover, three-dimensional matrices are associated with higher levels of transnational strategy than are two-dimensional matrices, confirming the gains from having additional structural dimensions. Matrix structures arise because of the need to simultaneously fit high levels of both firm internationalization and corporate integration. Matrices fit the transnational strategy type of Bartlett and Ghoshal. Implications are drawn for the relationship between the head office and the subsidiary. The matrix often subjects the subsidiary to conflicting expectations from the head office, which it can attempt to manage. Similarly, the head office is challenged by the task of integrating the information that comes from different dimensions of the matrix.

Decisions about the design of the organization and the competitive strategy of a firm are very important in order to gain competitive advantage and to improve firm performance. The relationship between organizational structure, competitive strategy, and firm performance has usually been analyzed using the contingency approach. The objective of this paper is to extend the relevant empirical literature of the strategy‐structure‐performance paradigm by comparing the resource‐based view (RBV) with contingency theory. To that end, the paper seeks to examine how organizational structure affects firm performance, taking into account the relationship with competitive strategy.

A sample of large Spanish firms was studied using the partial least squares (PLS) technique.

The results support both the RBV and the contingency approach, but the RBV is more strongly supported. The findings show that organizational structure does not exert a direct influence on performance, but has an indirect influence through competitive strategy.

The findings are limited to large firms. Therefore, they cannot be generalized to smaller companies. In addition, the use of opinion scales gives the study a subjective character. However, in this respect, most of the characteristics of organizational structure and competitive strategy are difficult to measure with objective data.

Researchers have studied the relationship between strategy and structure for a long time based on contingency theory. This study provides an alternative formulation for organizational design theory, based on the RBV, which makes it possible to reframe the relationships between strategy and structure by analyzing the organizational structure as a valuable resource and a source of competitive advantage.

The strategic management perspective suggests that organizations structure their governing boards to complement the strategic goals of the organization. In contrast, the institutionalization perspective holds that organizations structure their governing boards to respond to institutional pressures in their task environment. Regardless of which perspective is followed, three structural dimensions of governing boards are expected to be affected: size, diversity of composition, and medical staff representation. A study was conducted to relate the institutional requirements and strategies of acute care hospitals to the structural characteristics of their boards of directors. Results indicated that, after controlling for organizational size and membership in a multihospital system, the governing board structure of 109 acute care hospitals varied significantly both as a function of their overall business strategy and as a function of institutional linkages. However, the proportion of the total variance in board structure accounted for by strategy variables was approximately twice as much as that accounted for by institutional variables.

This paper aims to attempt to bring together various organisational aspects that have never been collectively investigated before in the strategic management literature. Its main objective is to examine the relationship between “strategic orientation” and “firm performance”, in the light of two firm-specific factors (“distinct manufacturing capabilities” and “organisational structure”). The proposed research model of the present study is built upon the resource-based view (RBV) of the firm and the organisational aspect of the VRIO framework (the “O” from the VRIO model).

The study proposes a newly developed research model that adopts a four-factor approach, while examining a number of direct and indirect effects. The examination of the proposed research model was made with the use of a newly developed structured questionnaire that was distributed on a sample of Greek manufacturing companies. Research hypotheses were tested using the structural equation modelling technique. The present study is explanatory (examines cause and effect relationships), deductive (tests research hypotheses), empirical (collects primary data) and quantitative (analyses quantitative data that were collected using a structured questionnaire).

The empirical results suggest the coexistence of three distinct categories of effects on “firm performance”: strategy or “utility” effects, depending on the content of the implemented strategy; firm-specific effects, depending on the content of the organisational resources and capabilities; and organisational effects, depending on the implemented organisational structure. More specifically, the statistical analysis underlines the significant mediating role of “strategic orientation” and the complementary role of “organisational structure”. Finally, empirical results support the argument that “strategy follows structure”.

The use of self-reported scales constitutes an inherent methodological limitation. Moreover, the present study lacks a longitudinal approach because it provides a static picture of the subject under consideration. Finally, the sample size of 130 manufacturing companies could raise some concerns. Despite that, previous empirical studies of the same field, published in respectable journals, were also based on similar samples.

When examining the total (direct and indirect) effects on “firm performance”, it seems that the effect of “organisational structure” is, almost, identical to the effect of “distinct manufacturing capabilities”. This implies that “organisational structure” (an imitable capability) has, almost, the same contribution on “firm performance” as the manufacturing capabilities of the organisation (an inimitable capability). Thus, the practical significance of “organisational structure” is being highlighted.

There has been little empirical research concerning the bundle of firm-specific factors that enhance the impact of strategy on business performance. Under the context of the resource-based view (RBV) of the firm, the present study examines the impact of “organisational structure” on the “strategy-capabilities-performance” relationship, something that has not been thoroughly investigated in the strategic management literature. Also, the present study proposes an alternate measure for capturing the concept of business strategy, the so-called factor of “strategic orientation”. Finally, the study adopts a “reversed view” in the relationship between structure and strategy. More specifically, it postulates that “strategy follows structure” and not the opposite (“structure follows strategy”). Actually, the empirical data supported that (reversed) view, challenging the traditional approach of Chandler (1962) and calling for additional research on that ongoing dispute.

The Nature of Business Policy Business policy — or general management — is concerned with the following six major functions: