The moderating effect of strategic fit enhances business performance: Empirical evidence from the telecommunication industry

Abstract

AbstractCompetitiveness is inevitable in a highly dynamic and rapidly changing technological situation. A proper linkage among business strategies is a key to developing a sustainable competitive advantage, enhance business performance, and to cope with global competition and rapidly changing environment. Drawing on the configuration theoretic approach, this study posits that firms can improve overall performance through accurate alignment of business strategies. Strategic fit is an emerging concept to make strategy effective. This study empirically tests a conceptual model within a sample of 320 respondents from the telecommunication industry of Malaysia. Data were analyzed with statistical software SMART‐PLS, which is recently used by numerous studies. This article concludes strategic fit significantly and positively moderate the relationship of business strategies and knowledge management strategies with business performance. Results show that business strategy (innovation and competitive advantage) and knowledge management strategy (codification and personalization) have a significant and positive impact on business performance. Although this research expands our understanding of the strategic fit importance in business performance, however, worthwhile prospects of future research remain, this study is limited to monomethod and only two exogenous variables are studied, future research can use mixed‐method and other factors that can influence business performance.