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Linking Porter’s generic strategies to firm performance

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  • Xhavit Islami

    (Saints Cyril and Methodius University in Skopje
    Department of Management, Faculty of Economics, University Kadri Zeka in Gjilan)

  • Naim Mustafa

    (Department of Management, Faculty of Economics, University Kadri Zeka in Gjilan)

  • Marija Topuzovska Latkovikj

    (Saints Cyril and Methodius University in Skopje)

Abstract

In this study, the significance of using Porter’s generic strategies in firms that operate in competitive environments is investigated. The aim is to indicate the effects of Porter’s generic strategies (low-cost strategy, differentiation strategy, and focus strategy) on firm performance. The questionnaires of the study have been prepared, the responses have been obtained, and the econometric model is constructed to measure these relationships. Findings stemmed by data that were taken from 113 firms that operate in the Republic of Kosovo. t test, Pearson’s correlation analysis, and multivariate regression analysis were used to provide testing of hypotheses. Econometric results suggest that pursuing differentiation strategy provides higher firm performance compared to two other Porter’s generic strategies (low-cost strategy or focus strategy) that have a positive impact as well.

Suggested Citation

  • Xhavit Islami & Naim Mustafa & Marija Topuzovska Latkovikj, 2020. "Linking Porter’s generic strategies to firm performance," Future Business Journal, Springer, vol. 6(1), pages 1-15, December.
    • Handle: RePEc:spr:futbus:v:6:y:2020:i:1:d:10.1186_s43093-020-0009-1
    DOI: 10.1186/s43093-020-0009-1
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    References listed on IDEAS

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