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Why pure strategies may be wrong for transition economy firms

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  • George A. Shinkle
  • Aldas P. Kriauciunas
  • Greg Hundley

Abstract

The strategy purity hypothesis argues firms will have better results pursuing a single, business‐level strategy of either cost leadership or differentiation rather than a mix of both. Since this claim implicitly assumes a developed‐economy context, we examine the efficacy of business strategies in transition economies. We find the benefits of a pure strategy are diminished when the institutional environment has a low degree of market orientation but are increased when the institutional environment is more market oriented. Our results indicate a boundary condition for the strategy purity hypothesis and support arguments for an institution‐based view of business strategy. Copyright © 2013 John Wiley & Sons, Ltd.

Suggested Citation

  • George A. Shinkle & Aldas P. Kriauciunas & Greg Hundley, 2013. "Why pure strategies may be wrong for transition economy firms," Strategic Management Journal, Wiley Blackwell, vol. 34(10), pages 1244-1254, October.
    • Handle: RePEc:bla:stratm:v:34:y:2013:i:10:p:1244-1254
    DOI: 10.1002/smj.2060
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