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Exploration and Firm Performance: The Moderating Impact of Competitive Strategy
Author(s) -
Su Zhongfeng,
Guo Hai,
Sun Wei
Publication year - 2017
Publication title -
british journal of management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.407
H-Index - 108
eISSN - 1467-8551
pISSN - 1045-3172
DOI - 10.1111/1467-8551.12218
Subject(s) - cost leadership , competitive advantage , business , context (archaeology) , industrial organization , linkage (software) , marketing , appeal , strategic management , paleontology , biochemistry , chemistry , gene , political science , law , biology
In this study we examine the moderating effect of competitive strategy (including differentiation and cost‐leadership strategies) on the relationship between exploration and firm performance. We find that the moderating effect of differentiation strategy is positive while that of cost‐leadership strategy is negative. And, these moderating effects are stronger in a highly competitive context. This study offers an explanation for previous mixed findings on the linkage of exploration to firm performance and enriches the discipline's knowledge regarding the performance implications of exploration. Moreover, we respond directly to the appeal in research on competitive strategy to clarify the role played by competitive strategy in profiting from exploration.