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A Study of the Role Played by Manufacturing Strategic Objectives and Capabilities in Understanding the Relationship between Porter's Generic Strategies and Business Performance
Author(s) -
GonzálezBenito Javier,
SuárezGonzález Isabel
Publication year - 2010
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/j.1467-8551.2008.00626.x
Subject(s) - flexibility (engineering) , sample (material) , strategic management , proposition , process management , business , competitive advantage , industrial organization , marketing , knowledge management , computer science , economics , management , philosophy , chemistry , epistemology , chromatography
An appropriate alignment between business strategy, manufacturing strategic objectives and manufacturing capabilities reportedly influences business performance positively. However, few papers empirically analyse this proposition for the case of Porter's generic strategies of cost leadership and differentiation, and none jointly considers all four elements. This paper integrates strategies, capabilities and performance in a single model and proposes that both manufacturing competitive priorities and capabilities, articulated in terms of cost and flexibility, are essential for explaining the link between generic business strategies and business commercial and financial performance. Within this analytic framework, we test whether companies that emphasize one business strategy rather than another achieve a better alignment and superior performance. The analyses conducted with a sample of 148 Spanish manufacturers provide general support for these propositions and contribute to a deeper understanding of the role played by functional strategies in understanding the outcomes of business strategy.