Impact of Porter’s Generic Strategy on Firm Performance with reference to Nepalese Retail Banking Sector

2021 ◽  
Vol 4 (i) ◽  
Keyword(s):  
Regression Analysis ◽  
Firm Performance ◽  
Low Cost ◽  
Differentiation Strategy ◽  
Cost Strategy ◽  
Generic Strategy ◽  
Low Cost Strategy ◽  
Focus Strategy ◽  
Generic Strategies ◽  
Focus Strategies

Porter’s generic strategies are the proven and pervasive strategic options in achieving competitiveness and better firm performance. This paper aims in examining the effect of Porter’s generic strategies (low-cost, differentiation, and focus) on firm performance in the context of Nepalese retail banks, a more competitive service industry. This study applies casual comparative research design and the data have been collected through administering questionnaire survey from 75 senior bank managers of 18 Nepalese commercial banks who being engaged in strategic affairs. The econometric model has been constructed to measure the expected effect of the strategies on firm performance. The descriptive analysis, Pearson’s correlation analysis, and multivariate regression analysis were conducted. The empirical results of correlation analysis and multiple regression analysis produced consistent results indicating positive associations between generic strategies and firm performance. The empirical results from regression analysis declared higher positive and significant impact of low-cost on firm performance. Similarly, positive effect of differentiation strategy and focus strategy on firm performance was reported. The findings suggested that pursuing low cost strategy provides more financial returns with comparison to differentiation and focus strategies. The finding also suggested for combination of low-cost and differentiation (and focus) strategies could provide better competitiveness and firm performance. Keywords: Generic Strategy, Low-cost strategy, Differentiation strategy, Focus strategy, Firm performance

scholarly journals Business Strategy, State-Owned Equity and Cost Stickiness: Evidence from Chinese Firms

2020 ◽  
Vol 12 (5) ◽  
pp. 1850
Author(s):  
Tingyong Zhong ◽  
Fangcheng Sun ◽  
Haiyan Zhou ◽  
Jeoung Yul Lee
Keyword(s):  
Business Strategy ◽  
Low Cost ◽  
Differentiation Strategy ◽  
Cost Strategy ◽  
Cost Behavior ◽  
Low Cost Strategy ◽  
The Cost ◽  
The Relationship ◽  
Management Expectations ◽  
Cost Stickiness

This paper investigates the relationship between business strategy and cost stickiness under different ownership. Using the data from listed firms in China from 2002 to 2015, we find that first, firms with different strategies exhibit different cost behavior. The cost stickiness of choosing a differentiation strategy is higher than that of choosing a low-cost strategy. Second, management expectations will affect cost stickiness. Optimistic expectations will increase cost stickiness, while pessimistic expectations will reduce cost stickiness. Third, management expectations can adjust the relationship between business strategy and cost stickiness in terms of government-created advantages (GCAs). If management expectations tend to be optimistic, the cost stickiness is higher with a differentiation strategy than with a low-cost strategy. If management expectations tend to be pessimistic, then cost stickiness is higher with a low-cost strategy than with a differentiation strategy. Finally, the state-owned equity affects the extent of the effect of a differentiation strategy on cost stickiness. State-owned firms, which receive more GCAs than non-state-owned firms, have stronger cost stickiness than non-state-owned firms, even if both categories of firms use more differentiation strategy.

scholarly journals Antecedents of University Performance: Does Strategy Matter?

2021 ◽  
Vol 9 (2) ◽  
pp. 176
Author(s):  
Okechukwu Lawrence Emeagwali
Keyword(s):  
Structural Equation ◽  
Equation Modeling ◽  
Differentiation Strategy ◽  
Generic Strategy ◽  
And Performance ◽  
Survey Responses ◽  
The Cost ◽  
University Performance ◽  
Focus Strategy ◽  
Generic Strategies

In a bid to contribute to the increasing body of extant interdisciplinary research within the antecedents of university performance and strategic management domains, this study investigates the role of generic strategies in the perceived performance of universities. Using a case study of eight Nigerian universities and survey responses from 380 academics and administrative staff from these universities, the study tested four succinct hypotheses using the covariance structural equation modeling (CB-SEM) technique. Findings revealed that while there was a limited link between differentiation strategy and performance, there was a substantially strong link between focus strategy and performance according to the findings. Similarly, findings revealed that respondents from public-private universities perceived their institutions as having the strongest generic strategy-performance connection, followed by respondents from the public sector. The cost leadership-performance path demonstrated no significant effect.

scholarly journals An Analysis of a Strategic Transformation Plan: The Case of Alaska Airlines

2013 ◽  
Author(s):  
Paul Caster ◽  
Carl Scheraga
Keyword(s):  
Product Differentiation ◽  
Airline Industry ◽  
Low Cost ◽  
Operating Income ◽  
Cost Leadership ◽  
Differentiation Strategy ◽  
Cost Strategy ◽  
Low Cost Strategy ◽  
Network Carrier ◽  
Strategic Transformation

In 2003, amid the turmoil of the U.S. airline industry in the post-9/11 environment, the senior management of the Alaska Air Group announced a “strategic vision” entitled “Alaska 2010.” The pronouncement articulated positions with regard to cost leadership, product differentiation, and growth. This study empirically assesses the efficacy of this decision with regard to the major network carrier of the air group, Alaska Airlines. The analysis focuses on the period beginning with the announcement and ending in 2010.The implementation of such a strategic protocol is dynamic and inter-temporal in nature. Therefore, it is often difficult to assess the effectiveness of changes in strategies, particularly since such effectiveness is often a function of the confounding forces of organizational strategy and market conditions. Thus, this study utilizes the multi-period methodology of the strategic variance analysis of operating income.This methodology decomposes operating income into three components: (1) growth, (2) price recovery, and (3) productivity. This is of particular interest from a strategic planning perspective, as the price component evaluates a company’s product differentiation strategy while the productivity component evaluates whether an airline’s low cost strategy was successful because of efficiency gains.

scholarly journals How do learning orientation and strategy yield innovativeness and superior firm performance?

2014 ◽  
Vol 45 (2) ◽  
pp. 35-50 ◽  
Author(s):  
M. Dülger ◽  
G. Alpay ◽  
C. Yılmaz ◽  
M. Bodur
Keyword(s):  
Firm Performance ◽  
Outcome Variable ◽  
Product Innovativeness ◽  
Differentiation Strategy ◽  
And Performance ◽  
Focus Strategy ◽  
Generic Strategies ◽  
Porter's Generic Strategies ◽  
Eventual Outcome

This paper attempts to shed light on the role of learning orientations of firms and their adoption of Porter’s generic strategies on four dependent variables: Behavioral innovativeness, product innovativeness, technological innovativeness and, ultimately, firm performance. Hierarchical regressions were run with data from a random sample of 121 firms operating in Turkey. Findings indicate that internally-focused learning, market-focused learning and differentiation strategy have significant effects on the three innovativeness dimensions. When firm performance is included as the eventual outcome variable into the analysis, internally-focused learning, focus strategy and product innovativeness emerge as its main predictors. In fast-paced, highly unpredictable market environments, managers can make use of these findings to their benefit in terms of elevating their firms’ innovativeness and performance levels.

scholarly journals The Combinations of Market and Non-Market Strategies That Facilitates Family Firm Survival

2020 ◽  
Vol 0 (0) ◽  
Author(s):  
Rodrigo Basco ◽  
Ana Isabel Rodríguez-Escudero ◽  
Natalia Martin Cruz ◽  
Ismael Barros-Contreras
Keyword(s):  
Family Business ◽  
Strategic Behavior ◽  
Family Firms ◽  
Low Cost ◽  
Business Systems ◽  
Differentiation Strategy ◽  
Family Enterprise ◽  
Kaplan Meier ◽  
Cost Strategy ◽  
Low Cost Strategy

AbstractEven though family firms are characterized by an overlap between the family and business systems, family business research has focused separately on how family firms compete (i. e., strategic behavior) and how families are involved their firms (i. e., types of family orientation). With the aim of closing this research gap, we draw on the heterogeneity principle of family firms and the equifinality principle of the configurative approach to conjecture that family firms can successfully adjust their strategic behavior and family business orientation in a variety of ways to enhance their likelihood of survival. We follow a sample of Spanish family firms over an 11-year period (2004–2015) to test our model. Based on the Kaplan–Meier survival estimator and the Cox proportional hazard model, we find that survival likelihood is higher when firms combine a differentiation strategy with a business-first or a family-enterprise-first orientation or when firms follow a low-cost strategy with a family-first orientation.

scholarly journals JSE listed companies in the food and drug retail sector: A content analysis of financial statements to determine their primary purpose

2016 ◽  
Vol 9 (3) ◽  
pp. 927-950
Author(s):  
Vanessa Gregory ◽  
Mihalis Chasomeris
Keyword(s):  
Low Cost ◽  
Financial Statements ◽  
Listed Companies ◽  
Retail Sector ◽  
Differentiation Strategy ◽  
Conscious Capitalism ◽  
Cost Strategy ◽  
Content Analyses ◽  
Low Cost Strategy ◽  
Sustainability Model

The overall purpose of the study is to analyse financial statements to determine the primary purpose of JSE listed companies in the food and drug retail sector. There were two parts to the analyses. First, the study examines the literature on the three models, namely: neoclassical, conscious capitalism and entity maximisation and sustainability in order to identify themes or major identifiers of each model. Second, it analyses the financial statements (over five years from 2010 to 2014) of JSE listed companies in the food and drug retail sector, in particular the non-financial information. The entire population was analysed as there were only four in the population, namely SPAR, Pick n Pay, Shoprite and Clicks. Annual integrated reports and sustainability reports (where separately published) were analysed using content analyses. Keywords and themes were used to link the attributes of the company to the attributes identified in the literature to determine the model the company used. The content analyses showed that the dominant model was the entity maximisation and sustainability model. However, each company appears to have chosen to focus on a different stakeholder: SPAR on employees, Pick n Pay on customers (with a differentiation strategy), Shoprite on customers (with a low cost strategy) and Clicks on shareholders.

scholarly journals A Strategic Variance Analysis of the Profitability of U.S. Network Air Carriers

2011 ◽  
Author(s):  
Paul Caster ◽  
Carl A. Scheraga
Keyword(s):  
Product Differentiation ◽  
Planning Process ◽  
Low Cost ◽  
Variance Analysis ◽  
Operating Income ◽  
Cost Leadership ◽  
Differentiation Strategy ◽  
Cost Strategy ◽  
Low Cost Strategy ◽  
Air Carriers

Airlines, as part of their strategic planning process, articulate positions with regard to cost leadership, product differentiation, and growth. Decisions implemented are dynamic and inter-temporal in nature. Therefore, it is often difficult to assess the effectiveness of changes in strategies, particularly since such effectiveness is often a function of the confounding forces of organizational strategy and market conditions. Managers thus need a multi-period methodology to evaluate the implementation of strategic positions. One such approach is the strategic variance analysis of operating income. Horngren et al. (2000, 2006, 2012) demonstrate a methodological template for decomposing operating income into three components: (1) growth, (2) price recovery, and (3) productivity. It is suggested that the price recovery component assesses a firm’s product differentiation strategy and that the productivity component assesses a firm’s low-cost strategy. Thus, this framework is very much in the spirit of Porter’s (1980) seminal work.This study examines U.S. network airlines in the post-9/11 environment. Utilizing the above methodology, it first identifies comparative strategic positions across airlines and then assesses the implementation efficacy of these positions.

scholarly journals Industry Environment And Business Strategy: A Comparison Of Contingency Theory Expectations And Relationships Between Small Manufacturing Firm Managers Perceptions Of Environment And Strategy

2011 ◽  
Vol 1 (8) ◽  
Author(s):  
Alfred M. Pelham ◽  
Pamela Lieb
Keyword(s):  
Contingency Theory ◽  
Low Cost ◽  
Positive Association ◽  
Sales Managers ◽  
Differentiation Strategy ◽  
Cost Strategy ◽  
Industry Environment ◽  
Market Turbulence ◽  
Low Cost Strategy ◽  
Customer Differentiation

Contingency theory suggests that that an appropriate match must be made between strategy and industry environment conditions. This study compared contingency theory expectations with the associations between perceptions of industry environment conditions and reported firm strategy, as reported by the firms president and national sales manager. Confirming theory expectations, there were significant and positive associations between perceived industry technical/market turbulence and reported growth/differentiation strategy as well as significant and negative associations with low cost strategy. The direction and significance of these associations were similar regardless of which manager supplied the perception of technical/market turbulence or the reported strategy. However there were differences across the two managers reports in the associations between strategy and perceptions of product differentiation, customer differentiation, and competitive intensity. Confirming theory expectations, there were significant and positive associations between perceptions of industry competitive intensity and the sales managers reported use of low cost strategy, but not the presidents reported use of that strategy. Confirming theory expectations, there was a significant and positive association between the presidents (but not the sales managers) perceptions of industry product differentiation and managers reported use of growth/differentiation strategy. There was a significant and positive association between the sales managers (but not the presidents) perceptions of industry customer differentiation and managers reported use of growth/differentiation strategy. The presidents and sales managers perceptions of product and customer differentiation had significant negative associations with the sales managers (but not the presidents) reported use of low cost strategy. The authors discuss potential explanations for these results and implications for managers.

scholarly journals KEUNGGULAN KOMPETITIF PRODUK TEPUNG KELAPA PADA PT. PUTRA KARANGETANG MINAHASA SELATAN

2018 ◽  
Vol 14 (1) ◽  
pp. 81
Author(s):  
Amelia Prisilia Sarah Tombeng ◽  
Leonardus R. Rengkung ◽  
Nordy F. L. Waney
Keyword(s):  
Competitive Advantage ◽  
Consumer Satisfaction ◽  
Low Cost ◽  
Data Retrieval ◽  
Simple Random Sampling ◽  
Cost Strategy ◽  
Total Data ◽  
Low Cost Strategy ◽  
Focus Strategy ◽  
Product Difference

The purpose of this study to determine the competitive advantage of coconut flour products at PT. Putra of Karangetang as measured by Low Cost Strategy, Product Differentiation and FocusStrategy. Research conducted at PT. Putra Karangetang located in Popontolen Village, Tumpaan Sub-District, South Minahasa Regency, in March 2017 until May 2017. The data used are primarydata through direct interview and filling questionnaire with sampling using simple random sampling method as much as 30 respondents who bought the product in PT. Putra of Karangetang, South Minahasa. The data is measured using Likert scale. The results showed the process of measuring the competitive advantage of coconut flour products at PT. Putra Karangetang South Minahasa total data retrieval 1517 which shows the index rate measuring consumer satisfaction of 72.23% and quite satisfied. This indicates that the company in PT. Putra Karangetang Minahasa Selatan aware about the benefits of coconut flour products in PT. Putra of Karangetang seen from low cost strategy, product difference strategy, focus strategy.

Sign in / Sign up

Export Citation Format

Share Document