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Performance implications of aligning generic strategies with the business environment

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  • P. Reklitis, P. Trivellas

Abstract

This article investigates the relationship between the external environment and competitive strategies compared with organisational performance. Firstly, we assess the independence of the environment, strategy and performance dimensions through a Principal Components Analysis (PCA). Secondly, we investigate the impact of the external environment (dynamism, complexity) and competitive strategies (differentiation, cost-leadership, focus) on the organisational performance of two selected samples of Greek manufacturing enterprises, by using a Hierarchical Regression Analysis. Based on a sample of 109 financially successful manufacturing firms, the first study suggests that a hybrid strategy encompassing elements of differentiation and low-cost based strategies is strongly associated with firms' growth. Further, this study indicates that differentiation strategy contributes to higher financial performance (profitability). Findings from a sample of 248 firms in Greece, competing in a wide variety of industries, confirm partially these relationships between business environment and generic strategies with organisational performance. This research concludes that a hybrid strategy encompassing elements of differentiation and low-cost based strategies is strongly associated with profitability. Finally, the results of the second study indicate also that a hybrid strategy that combines differentiation and focus based strategies is strongly related to firm’s growth in environments high in dynamism.

Suggested Citation

  • P. Reklitis, P. Trivellas, 2002. "Performance implications of aligning generic strategies with the business environment," International Journal of Management and Decision Making, Inderscience Enterprises Ltd, vol. 3(3/4), pages 319-336.
    • Handle: RePEc:ids:ijmdma:v:3:y:2002:i:3/4:p:319-336
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    Cited by:

    1. Panagiotis Trivellas & Georgios Malindretos & Panagiotis Reklitis, 2020. "Implications of Green Logistics Management on Sustainable Business and Supply Chain Performance: Evidence from a Survey in the Greek Agri-Food Sector," Sustainability, MDPI, vol. 12(24), pages 1-29, December.
    2. Panagiotis Reklitis & Damianos P. Sakas & Panagiotis Trivellas & Giannis T. Tsoulfas, 2021. "Performance Implications of Aligning Supply Chain Practices with Competitive Advantage: Empirical Evidence from the Agri-Food Sector," Sustainability, MDPI, vol. 13(16), pages 1-21, August.

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