The Effect of Business Environment on the Corporate Performance Through Business Strategies in the Construction Service Industry in DKI Jakarta, Indonesia

Abstract

This research on the construction service industry in DKI Jakarta aims to: 1) analyze the influence of the external and internal business environment on corporate performance, 2) Analyze the influence of the external and internal business environment on business strategy, and 3) Analyze the influence of business strategy on the corporate performance. This research uses a quantitative research approach. The number of samples was 370 top management/heads of construction service companies in DKI Jakarta. Data were collected through questionnaire and interview instruments. Data analysis was performed by SEM With Partial Least Square (PLS). The analysis shows that the external and the internal environment have a significant influence on business strategy and performance. The business strategy also influences the performance of construction service companies in DKI Jakarta. These findings suggest that construction service companies are always on the lookout for turmoil that occur in the external environment, so that they can be major consideration for companies in setting their strategies both in the short and in the long term.