Levels Of Competitive Intensity Research Articles

The Association between microfinance rating scores and corporate governance: a global survey

The global microfinance industry has experienced high growth rates over the past decades, and the World Bank foresees a future market with billions of customers. However, the industry's continued growth is contingent on its ability to create a governance structure that supports microfinance institutions' long-term performance. Because microfinance institutions' performance is multidimensional and difficult to measure, prior research has not been successful in establishing consistent associations between governance structures and microfinance institutions' performance. We apply microfinance rating scores – a unique innovation of the microfinance industry – as a summary performance metric and find that several governance metrics are related to microfinance performance. Specifically, we find that CEO/Chair duality has a negative relation to rating scores, whereas the number of international board directors, the presence of internal auditors and the level of competition intensity are positively associated with rating scores. These findings should prove useful in an industry in which there is no established ‘best set-up’ for governance mechanisms.

Opening the Black Box of Upper Echelons in China: TMT Attributes and Strategic Flexibility

Many scholars have suggested that strategic flexibility is a critical firm capability to survive in today's competitive arena. The decision to take strategic actions to make the firm more strategically flexible typically originates in the top management team (TMT). As the principal decision‐making unit of the firm, TMT members' information acquisition and processing capabilities and subsequent interpretation of environmental changes critically influence the decision to make the firm more strategically flexible to achieve a better fit with its market environment.Therefore, in order to understand how firms can adapt to environmental changes, scholars must study the sociopsychological processes of interaction among members of the TMT. This study examines the relationships between TMT's sociopsychological attributes (shared vision, social integration, and political ties) and strategic flexibility, which is decomposed into organizational flexibility and technological flexibility. The study further investigates how the level of competitive intensity can moderate the relationships. All the hypotheses are tested using structural equation models based on the survey data from 227 firms in China.The results show that organizational flexibility mediates the impact of TMT's social integration and political ties on technological flexibility. Surprisingly, a TMT's shared vision for the firm neither impedes nor facilitates the firm's effort in attaining the desired degree of organizational flexibility. However, TMT's shared vision does have a positive and direct impact on technological flexibility. Moreover, intense competition amplifies the positive impact of TMT social integration on the degree of organizational flexibility, but there is no significant moderating effect of competitive intensity on the relationship between a TMT's political ties and organizational flexibility. The results extend previous research by highlighting the importance of TMTs' sociopsychological attributes in driving technological flexibility, through the mediating impact of organizational flexibility.

Is There a Level of Competition Intensity that Maximizes Investment in the Mobile Telecommunications Industry?

This paper investigates the relationship between competition and investment in the wireless industry from a dynamic perspective. Using firm level data and instrumental variable estimation strategy, it finds that the relationship is inverted-U shaped, with an investment maximising intensity of competition at 60 or 63 percent, depending on whether capital expenditures are normalised by the number of subscribers. This finding means that investment increases with competition as long as wireless operators’ profits represent more than 37 or 40 percent of their total revenue. Below these thresholds, there is a tradeoff between competition and investment. Moreover, there is a significant long run effect of competition on investment in the wireless industry. The magnitude of the long run effect is 3 or 4 times the short run effect.

Detecting the relationship between competitive intensity and firm product line length: Evidence from the worldwide mobile phone industry

The way firms lengthen or shorten their product line with respect to rivals is regarded as one of the possible strategies firms can pursue to respond to competition. This article builds and tests hypotheses to study the effect of different levels of competitive intensity on product line length. The empirical analysis of data on 3,527 handset models introduced by 66 mobile phone vendors from 1994 to 2010 shows a consistent inverse U‐shaped relationship between competitive intensity and the firm's product line length. In this way, we pinpoint an interesting link between the product line extension literature and the competitive dynamics and competitive intensity perspectives. Copyright © 2013 John Wiley & Sons, Ltd

Project competition intensity (PCI) in the construction market: a case study in China

In economic terminology, ‘competition intensity’ can be used to mirror to a certain degree the status of industrial competition in a specific market, while in the construction market, it particularly involves the part of project competition intensity (PCI). Based on a road project in China, two forms of PCI, overt and covert, are identified in this study. To lower project construction cost thus enabling better project tendering performance, clients can facilitate higher levels of overt PCI by tailoring their tendering procedures, whereas, through covert PCI project competitors can adopt anti‐competitive behaviours to attain the expected works. The difference between overt PCI and covert PCI indicates various practitioners' perspectives and impact on the levels of competition intensity in construction. The findings suggest a way to promote PCI studies in the future, and offer new insights into other parts of competition intensity in construction.

Managerial Economics and Global Competition

Global managerial economics tends to emerge in conditions of strong, continuous competitive tension, in contexts that are open and subject to political, social and technological instability. Globalisation and new competition boundaries oblige companies to adopt a new ‘market-oriented competitive management philosophy’ (market-driven management), in which customer value management predominates. Global managerial economics thus interfaces with numerous competition spaces, all with different levels of competitive intensity, and market-driven corporate management thus refers to specific competitive conditions, which may typically be summed up as: conditions of scarcity of supply (D>S), with business economics focused on price competition; conditions of controlled competition (D~S), where management economics embodies widespread internationalisation and non-price competition policies; conditions of over-supply (D<S), where management economics underlines the central role of corporate and product intangible assets.

Deregulation and Competition in the Financial Industry

Deregulation has stimulated much economic and political interest. This paper develops a framework for understanding the effects of deregulation from an ecological perspective and reports empirical studies of financial institutions (banks, thrifts and mutual funds) at two levels of analysis: the system and the population. These both show that deregulation bad a dramatic impact on the level of competitive intensity within the financial industry. The main contributions of this paper are the application of a general sociological theory of organizational dynamics to understanding deregulation and the development of a general approach to modelling which could lead to new ways to evaluate the organizational consequences of major environmental changes.

An Empirical Investigation of Adoption Issues Relating to Activity‐Based Costing

This paper provides empirical evidence relating to the characteristics of firms adopting ABC compared to those not adopting ABC. The empirical evidence is based on responses received from 120 manufacturing companies. The characteristics explored relate to what are referred to as firm characteristic and business environment variables which are defined as those relating to: cost structure, production complexity, production diversity, firm size and the level of competitive intensity. Five hypotheses are developed from a discussion of the literature relating to adoption issues. The results suggest that there would appear to be significant differences between firms adopting ABC and those not adopting ABC in relation to production complexity, firm size and level of competitive intensity, while there would appear to be no significant differences in relation to the proportion of overhead costs in total manufacturing costs and production diversity.

Effects of exploitative food competition on food niche dynamics — a simulation analysis

The effects of intra- and interspecific exploitative food competition on food niche dynamics were analysed using simulation models with 2 or 5 coexisting predator species, competing for 2 or 5 prey species. For each of these combinations, food consumption by predators was calculated assuming functional responses of either type 1, 2 or 3. Two levels of competition intensity were studied: low and high intensity, with food consumption decreased by 1% or 50% as compared to a situation without competition. The reproduction of prey was either slow or rapid, potentially increasing the number of prey at the end of a simulation by either 2∗ or 100∗ initial abundances. Prey reproduction was either exponential, influenced by intraspecific interaction or by both intra- and interspecific interactions between prey. All together, separate analyses of intra- and interspecific competition between different numbers of predator species combined with different numbers of available prey species, competition intensities, functional responses and rates and regulation of prey reproduction, gave 288 different types of models. For each of these, 100 simulations were run, with prey capture rates determined randomly for each predator-prey combination. The output data analysed were frequencies of increases and decreases in food niche overlap in response to interspecific competition and expansion and contraction in food niche width in response to either intra- or interspecific competition. All changes in niche parameters resulted from pure exploitative competition, without behavioural changes, short-term selection or evolutionary processes. The results were complex, with both increases and decreases in niche width and niche overlap as results of intra- and interspecific competition. Frequencies of increases and decreases were influenced by complex interactions between number of species of predators and preys, functional response of predators and reproduction rate and density dependence in prey population growth. The effect of one species on the niche width of another, as well as on their mutual niche overlap, sometimes changed with the intensity of competition. These results are in strong contrast to the niche dynamics theory frequently used as basis for interpreting field data, according to which species are assumed to generalise in response to intraspecific competition (niche expansion), and segregate and specialise in response to interspecific competition (decreased overlap and niche contraction [resource partitioning]). These variable results were derived from models which are very simple compared to the complexity of Nature, a complexity which is reasonable to assume increases the possibility for the development of complex niche dynamics. In my opinion, niche dynamics in Nature are thus very likely to be complex and great care must be taken before concluding from field data on food niche dynamics whether or not coexisting species compete.