Abstract

According to many researchers of organizational theory, a great number of problems encountered by the manufacturing firms are due to their ineffectiveness to respond to significant changes of their external environment and align their competitive strategy accordingly. From this point of view, the pursuit of the appropriate generic strategy is vital for firms facing a dynamic and highly competitive environment. In the present paper, we adopt Porter's typology to operationalise organizational strategy (cost leadership, innovative and marketing differentiation, and focus) considering changes in the external business environment (dynamism, complexity and munificence). Although simulation of social events is a quite difficult task, since there are so many considerations (not all well understood) involved, in the present study we developed a dynamic system based on the conceptual framework of strategy‐environment associations.

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