Type Of Business Strategy Research Articles

Business strategy and stock price crash risk: The mediating role of financial constraints

The global financial crisis increased uncertainty in economic policy. Firms manage challenges through business strategies and financial constraints and deal with crash risk more proactively to overcome these impediments. This paper investigates the mediating role of financial constraints in the association between business strategy and crash risk, and the type of business strategy that influenced crash risk in Egyptian firms from 2014 to 2021. Data were obtained from financial statements and reports available in the Thomson Reuters database. A total of 792 observations were collected, representing 99 Egyptian firms. The statistical techniques employed in the analysis included ordinary least squares, modified least squares, and path analysis. The results indicate that a higher financial constraint ratio increases crash risk and has a mediating effect on business strategy and crash risk. Results show a positive impact of prospector strategy on crash risk using OLS and GLS, in line with the bad news hoarding hypothesis. Further research shows that prospector strategies have a positive effect on financial constraints. Egyptian firms have higher levels of information asymmetry, which leads to adopting a prospector business strategy and exerts a more pronounced positive influence on the likelihood of crash risk. A robustness check confirms the positive effect of financial constraints as a mediator variable on the relationship between prospector business strategy and crash risk.

АДАПТАЦІЯ БІЗНЕС-СТРАТЕГІЙ УКРАЇНСЬКОГО БІЗНЕСУ В УМОВАХ ВІЙНИ: МІЖНАРОДНИЙ ДОСВІД

Russia's war against Ukraine destroyed infrastructure, disrupted supply chains, caused a loss of markets and resources, an outflow of human capital, and more. In such conditions, search for effective business adaptation and survival strategies ЕКОНОМIКА ТА УПРАВЛIННЯ ПЕРСОНАЛОМ 53 becomes critical. Turning to international experience, in particular to business strategies of the companies that faced crises and conflicts, can become a valuable source of knowledge and insights for Ukrainian business. International management operates with different types of business strategies. Among them: global strategy, multinational strategy, transnational strategy and international strategy. During crises and conflicts, companies are often forced to review their strategies and adapt them to new conditions. The ability to review is dictated by the presence of the following traits in the companies: strategic flexibility, dynamic capabilities, organizational stability, leadership and innovation. The key challenges and threats that Ukrainian enterprises face in wartime, and which must be taken into account when adapting business strategies: the reality of war, hostilities, missile attacks; almost complete blockade of key supply chains through sea lanes; inability to fully and quickly replace maritime supply routes with land ones; internal logistical problems associated with the physical destruction of a significant part of the infrastructure. Based on the international experience of business adaptation to crises, it is possible to recommend domestic management to adapt business strategies in the conditions of military challenges, primarily using proven approaches of international management, adapted to local conditions: in terms of optimizing supply chains, it is advisable to pay attention to the search for alternative, reliable suppliers and logistics routes from among the use of local resources to reduce dependence on imports; in terms of reorientation from exports to the countries of the former CIS, to focus on the domestic market and state orders (in particular, the military industry); to increase use of digital technologies to improve primarily internal business efficiency for digital transformation and innovation; to introduce strategic planning flexibility; personnel development; search for strategic partnerships; revision of approaches to finding financing and lending.

Predicting and assessing bankruptcy risk: the role of accounting conservatism and business strategies

Purpose This study aims to investigate the effect of accounting conservatism and business strategies as mitigating tools for bankruptcy risk. It determines the association among these factors and provides insights into the effectiveness of accounting discretion and business strategies in decision-making. Design/methodology/approach The study uses a sample of 83 nonfinancial listed firms in ASE for the period from 2013 to 2019. Bankruptcy risk is measured using the Altman Z-score (1968). Accounting conservatism is measured using the accrual-based approach, and optimal business strategies are identified through cluster analysis. Findings The results indicate that accounting conservatism has a significant negative effect on bankruptcy risk. Increased application of accounting conservatism practices leads to a decrease in the level of bankruptcy risk. However, the type of business strategy adopted by firms does not have a significant impact on bankruptcy risk, suggesting that firms are not effectively implementing their strategies to mitigate this risk. Research limitations/implications This study focuses on nonfinancial listed firms in the ASE, limiting the generalizability of the findings to other contexts. The study's findings contribute to the understanding of the role of accounting conservatism in reducing bankruptcy risk but highlight the need for further research on the effectiveness of business strategies in mitigating this risk. Originality/value This study lies in understanding of the role of accounting discretion in financial evaluations and emphasizes the importance of accounting conservatism as a tool for mitigating bankruptcy risk. The study's insights provide valuable guidance to practitioners, regulators and researchers in this field.

Digitising Miles and Snow: using cluster analysis to empirically derive digital business strategy types

ABSTRACT Digitisation is among the macro-trends that significantly influence the business world in the twenty-first century. Firms striving to succeed in this environment must develop new strategic approaches. The accelerating development of information technology (IT) drives digitisation. Therefore, IT and business strategies must be integrated. In this context, the information systems literature promotes the concept of digital business strategies (DBSs), reflecting a fusion between IT and business strategies. However, knowledge of the types and characteristics of such DBSs is currently scarce. Therefore, we developed a conceptually and empirically grounded typology of DBS based on the well-known business strategy classification by Miles and Snow (1978). Using a dataset comprising 192 firms worldwide, we conducted a cluster analysis, identified basic types of DBS, and evaluated their effects on firm performance. Moreover, we identified four types of DBS: non-digital reactor, analyser, digital opportunist, and digital producer. The study contributes to a better understanding of new business strategy concepts in the digitisation context.

Exploring HR practitioner’s perspective on linking of employer branding and porter’s generic strategies: an alignment of business and HR strategy

PurposeThe purpose of this study is to identify the impact of Michel Porter's generic business-level strategies adopted by the organisation on its employer branding strategy. Based on the expert’s opinion and insights, this study aims to determine the extent to which the employer branding strategy, its inherent significance, the requisite investment and the used tactics are influenced by the organisation's business strategy.Design/methodology/approachConsidering a phenomenological research design, this study adopted semi-structured interviews as a means to gather qualitative data from a purposive sample comprising HR professionals. The collected data were subjected to thematic analysis, enabling the identification of recurring themes and patterns. Findings and conclusions were subsequently derived in accordance with the outcomes of the thematic analysis.FindingsThe study revealed that the significance, nature, challenges and ways of implementation of employer branding strategies vary depending on the type of business strategy adopted by the organisation. While organisations pursuing a differentiation strategy heavily invest in employer branding and placing considerable efforts into developing an appealing employee value proposition, companies pursuing cost leadership invest relatively less in employer branding by implementing cost-effective tactics. Companies implementing a focus strategy demonstrate a moderate level of investment in employer branding initiatives.Research limitations/implicationsThe study is limited to IT, manufacturing and banking sectors only. Additionally, the sample of the study is limited.Practical implicationsEmployer branding as a strategy has been widely explored in the recent past. Similarly, Michel Porters’ generic strategies have also been widely researched. However, the interconnection between these two levels of strategies presents novel perspectives for business strategists and HR professionals involved in the formulation and implementation of HR strategies. This linkage provides valuable insights that facilitate effective decision-making in relation to employer branding strategies, enabling organisations to prioritise their objectives more effectively.Originality/valueThe existing literature lacks research that investigates the connection between employer branding strategy and business strategy. Hence, this study represents a pioneering effort that aims to explore this unexplored linkage. Further, this research effort has also uncovered previously uninvestigated findings concerning the comparative analysis of employer branding strategies across different sectors while examining the connection between business strategy and employer branding strategy.

DIRECTIONS FOR IMPROVING THE ORGANISATIONAL SYSTEM OF VALUE-BASED MANAGEMENT IN A HIGH-TECH COMPANY

The purpose of the article is to formulate directions for improving the organisational system of value-based management in a high-tech company. Methodology. The methods of analysis and synthesis, comparison and grouping, conceptualisation, strategic analysis and business process reengineering were the methodological basis of the research. Results. The conditions under which it is possible for Ukrainian high-tech enterprises to withstand competition, to survive, to develop, to be in the process of self-improvement, in a state of constant search for new organisational forms of functioning and technologies, new strategies of functioning, new types of products and new areas of application of products are defined. The methods of existence of high-tech companies are determined – the concept of survival and the concept of breakthrough. Within the framework of creation of modern organisational and technological systems three basic types of general business strategies are proposed – leadership, differentiation, focusing. For the modern practice of value-oriented management of innovative production from the point of view of intra-company management, the main characteristics are defined – functional, process, system, elemental. The organisational management of a high-tech enterprise when creating modern organisational and technological systems must take into account the following types of modernisation: technological, social, institutional, cultural. At the same time, possible ways of restructuring the enterprise are determined. The life activity of a high-tech enterprise is analysed in relation to its business processes and business functions. In general, the change in the goals and orientation of high-tech production is reflected in the content of the management concept and management structures, as the scope of cost analysis tasks related to the search for optimal conditions for the production and sale of goods, economic risk assessment and forecasting the behaviour of competitors is expanding. There is a need for infrastructural changes determined by the organisation and functioning of special units focused on the system of strategic planning and organisational support of decisions. Value/originality. A model of the organisation of intra-firm management in a high-tech enterprise is proposed by optimising the value-oriented management system of a high-tech enterprise, taking into account the complexity of the modern production system, its heterogeneity, the changeability of its elements, the structural diversity and the variety of links between them.

Business Strategy and Financial Opacity

ABSTRACT In this study, we investigate whether different types of business strategy are related to financial opacity and, if so, whether financial constraints and decreasing production demand exacerbate or mitigate financial opacity. Using a sample of listed firms in Taiwan from 2013 to 2018, we find that defenders mitigate financial opacity through loss avoidance and exacerbate financial opacity through aggressive earnings, especially when they face lower financial constraints and during decreasing production demand. However, prospectors do not exacerbate financial opacity by smoothing earnings especially when they face higher financial constraints and their production demand is increasing. Our study should be of interest to researchers and financial statement users, as well as others concerned with understanding the effects of different types of business strategy on different levels of financial opacity.

Innovation and Performance Implications of Customer-Orientation across Different Business Strategy Types

Given that the ultimate goal of business is performance enhancement, this study approaches the phenomenon by drawing on resource-advantage (R-A) theory to conceptualize a model with the aim of investigating the links among composite operant resources (CORs), namely customer orientation, basic operant resources (BORs), innovative capability, and financial performance across Miles and Snow’s five business strategy types, including prospectors, differentiated defenders, low-cost (LC) defenders, analyzers, and reactors. The scope of this study is firms based in the emerging market of Thailand. A final sample of 395 Thai firms participated in the self-administered survey. Multiple-group structural equation modeling and multivariate analysis of variance (MANOVA) were utilized to test the hypotheses. The results revealed insightful findings that advance the strategy and innovation literature. While business strategy types moderate the proposed relationships, the only one that is uniform across all five types of firms is the positive, strong, and significant customer orientation–innovation capability link. Moreover, customer orientation and innovative capability contribute significantly to financial performance among prospectors and LC defenders. However, only the former is essential to differentiated defenders, analyzers, and reactors. Overall, the findings suggest that managers must pay attention to connections between their chosen business-level strategy, customer-focused resources, and innovation capabilities to generate the best financial performance outcomes for their firms.

Constrained entrepreneurship in UK agriculture: A Weberian analysis

This conceptual paper draws on Max Weber's Iron Cage metaphor to explore its value in understanding how farmers are responding to the institutional contexts that influence and constrain entrepreneurial activities. We create Ideal Types of farmers, farm businesses and farm business strategies to provide a nuanced understanding into the heterogeneous ways Upland farmers are navigating and responding to ever-shifting Constrained Institutional Contexts (CIC's). We examine Weber's original cage metaphor, and draw on its limitations by framing it alternatively to provide a unique lens to examine the UK farming context. We add clarity into how farmers are responding to the challenges arising from the contexts within which they operate, providing a strong theoretical underpinning that can be used by other scholars to examine constrained rural entrepreneurship.

How business strategy drives human resource practices in small and medium enterprises? Evidence from Pakistani autoparts industry

PurposeIn large enterprises, the notion is that an organization’s business strategy is a significant determinant of its human resource (HR) practices. However, there is limited evidence in the literature of such linkages for small and medium enterprises (SMEs). The purpose of this paper is to examine the nature and extent of the relationship between the types of business strategies used and HR practices, namely, staffing, training and employee relations among SMEs.Design/methodology/approachThe authors have collected data from 168 SMEs manufacturing autoparts and purposively chosen three SME case studies to derive in-depth observations of business strategies and HR practices. Quantitative results from the survey indicate that these SMEs exhibit a logical relationship between the strategic posture of the SMEs and their adopted HR practices.FindingsThis study illustrates that SMEs operating in the risky and lesser developed labor markets of a lower-income country such as Pakistan adopt certain practices that differ considerably from firms operating in more competitive automotive markets using highly skilled labor. The findings suggest that there is a significant potential to be realized through strategically managing HR practices to achieve sustainable competitive advantage.Practical implicationsEducation of supervisors and management and suitable skill level of labor in tandem with continuous cutting edge industrial training appear to be the most successful business strategy followed by Prospector and Analyzer SMEs. For greater efficiency they need to have dedicated HR management, and financial and auditing services. Meanwhile, public sector entities as well as representative business bodies need to provide targeted practical technical and financial training and assistance to strengthen Defender and Reactor SMEs and improve their range of outputs.Originality/valueThis study contributed to the SMEs’ management literature in the context of Pakistan because there are very few studies that have examined the impact of business strategy on the HR practices in SMEs manufacturing autoparts in the automotive industry of Pakistan. The case study approach captures detailed insights and identifies the areas where the SMEs in developing countries perform differently than the SMEs in developed countries.

CLASSIFICATION OF ENTERPRISE LOGISTICS STRATEGIES

The article contains scientific research on the latest scientific and practical literature, which includes the achievement and results of current studies in the area of strategic management of the enterprise logistics business and the publication of strategic research. It has been revealed that this approach was directly going through the first stage of their development, at the same time as one of the most important and most demanding. This fact partly causes and explains the problematic reasons for the development of logistics strategies, which are the subject of scientific leaders’ discussion, their classification which is the reason for the need for further intensive studies.
 The main purpose of the article is to improve the classification of logistics strategies by identifying, justifying and streamlining their features and types.
 The extensive analysis of scientific papers on the development of logistics strategy of an enterprise, allowed to state the fact of their existence and application alone, that is, there is a lack of a certain system, order and interdependence between particular types of logistics strategies. At the same time, in most works the authors do not detail the feature of their classification, which leads to the lack of hierarchical representation (the allocation of primary and secondary classification features).
 The study proved that the logistics strategy should be considered as a deepening of the business strategy of an enterprise. Based on the definition of the term "logistics strategy" and the corresponding essential identified features, the logistics strategies are grouped at two levels: the first level involves the allocation of general logistics strategies according to the type of business strategy (the strategy to minimize overall logistics costs; improving the quality of logistics service; the innovative logistics strategy); the second level outlines the subtypes of logistics strategies of the first level in accordance with the relevant directions and programs of action.
 The proposed classification of enterprise logistics strategies is the basis for modeling their types depending on the goals, conditions and capabilities of each individual enterprise, and is the basis for further research and development in this area.

Ключові завдання антикризового управління при проектуванні та моделюванні організаційно-технологічних систем у високотехнологічному виробництві (Частина 2)

In this material, an attempt is made to form a conceptual approach to the optimal management of the creation of organizational and technological systems in domestic high-tech production within the framework of the implementation of the concepts "Industry 4.0" and "Human 2.0". A retrospective analysis of the economic situation in the country was conducted, which led to a decrease in the pace of its innovative development. The conditions under which it is possible for Ukrainian high-tech enterprises to withstand competition, survive, develop, be in the process of self-improvement, in a state of constant search for new organizational forms of functioning and technologies, new strategies of functioning, new types of products and new areas of application of products are defined. The methods of existence of high-tech enterprises are determined – the concept of survival and the concept of breakthrough. Within the framework of the creation of the latest organizational and technological systems, three basic types of general business strategies are proposed – leadership, differentiation, focusing. For the modern practice of management of innovative production from the point of view of intra-company management, the main characteristics are defined – functional, process, system, elemental. The organizational management of a high-tech enterprise when creating modern organizational and technological systems must take into account the following types of modernization: technological, social, institutional, cultural. At the same time, possible ways of restructuring the enterprise are determined. The vital activity of a high-tech enterprise in the relationship of its business processes and business functions is analyzed. A model of the organization of intra-firm management at a high-tech enterprise is proposed. The optimization of the financial and economic management system of a high-tech enterprise is considered taking into account the complexity of the modern production system, its heterogeneity, the changeability of its elements, structural diversity, and the diversity of connections between them. In general, the change in the goals of high-tech production is reflected in the content of the management concept and management structures, as the range of tasks for economic analysis related to the search for optimal conditions for the manufacture and sale of goods, economic risk assessment, and forecasting the behavior of competitors is expanding. There is a need for infrastructural changes, which are determined by the organization and functioning of special units, which are focused on the system of strategic planning and organizational support of decisions.

Corporate social responsibility in franchising: A meta-analytic review

Purpose: This study seeks to present a comprehensive meta-analysis of academic research on corporate social responsibility and franchising over the past 27 years (1994–2020).Methodology: The data was compiled using the ISI Web of Science database. A total of 204 articles were identified and analysed through bibliometric citation and content analysis.Findings: The analysis reveal the 49 most relevant articles, 107 authors, and 21 journals. The trending themes in the literature were clustered into three research streams: ethics and franchising; drivers of CSR performance and disclosure; and impact of CSR on organisational performance. Overall, the literature indicates that franchising has ethical implications which impacts on the large group of stakeholders it creates as a type of business strategy. Also, despite the high costs of pursuing corporate social responsibility, empirical evidence suggests that it is beneficial in establishing quality relationship with stakeholders which in turn has implications for operational and financial performances.Implications: The study makes an important contribution to existing knowledge for practitioners and provides the basis for further studies. Contribution: As the first review paper in the field, the article is unique in its extensive review and synthesis of the literature in corporate social responsibility and franchising.

The Miles and Snow Business Strategy Typology and the Adoption of Management Accounting Practices

Changes in the business environment requires that a company adopts a more adaptive strategy. A business strategy is not just about planning, but it needs to be supported with meaningful information. Management accounting complements a business strategy by providing crucial information, not just limited to cost efficiency, but customer satisfaction and quality management. However, the adoption of management accounting practices (MAPs) is believed to be influenced by strategy. Using the Miles and Snow (1978) business strategy typology model, this study examined the influence of business strategy on the adoption of MAPs, focusing on how the different types of business strategies used in organizations may influence the adoption of MAPs. Data was collected from manufacturing companies in Malaysia. The result showed that most Malaysian manufacturing companies utilized three major classifications of strategies, i.e., defender, prospector, analyzer, and only a few were classified as reactors. The result showed that the adoption level of both traditional and advanced MAPs is also high. Findings from this study indicated an influence of the defender and analyzer types towards adopting traditional MAPs, whereas the prospector type had influenced the adoption of advanced MAPs. Keywords: management accounting practices, business strategy, defender, prospector, analyzer, reactor

Hybrid games in strategy analysis: Bargaining in the shadow of competition

In the analysis of value capture, it is central to understand what value each group of players can capture when leaving the negotiation table. Frequently, this will entail engaging in competition, i.e., non-negotiated, strategic interactions with the other players. For instance, if merger talks fail, parties may instead compete on the market. I propose to analyze such situations using a combination of cooperative and noncooperative games, which I refer to as hybrid games. Applications demonstrate how the nature and intensity of the non-negotiated interactions determine value capture, and that a correct delineation of negotiation groups is essential for a realistic analysis. I also show that biform hybrid games feature a type of value-based business strategy in which the stage-one actions literally change the game.

Does business strategy and management control system fit determine performance?

PurposeThis study examines the relationship between business strategy, management control system (MCS) type and performance. Does the alignment of organisation business strategy and MCS fresult in better performance?Design/methodology/approachThis study draws on the business strategy and MCS type literature to identify business strategies and MCS types. A scoring method was used to identify business strategy types and cluster analysis to identify MCS types from a sample of 80 firms and 621 firm-years of data. Analysis of variance was used analyse the differences.FindingsFour types of MCS were identified and were labelled clan, adhocracy, market and hierarchy. The sample was split into defender, analyser, prospector and reactor strategies. The results showed defender strategies performed better with hierarchy or market type MCSs while prospector strategies performed better with clan or adhocracy MCS types. Analysers performed acceptably with all MCS types.Practical implicationsThe results of this study suggest that organisations should align their business strategy with a certain MCS type to achieve good performance. Also, alignment of top management and business strategy is supported as the top management properties differ between the MCS types.Originality/valueThis research contributes to the management control and strategy literature by demonstrating how the alignment between organisation business strategy and organisation-level MCS type determines organisational performance. The results suggest that differing business strategies yield better performance when aligned with the appropriate management controls represented by an MCS type.

Business strategy and environmental inefficiency

This study examines the relationship between firm-level business strategy and environmental inefficiency, measured by the total amount of chemical releases reported to the U.S. Environmental Protection Agency’s (EPA) Toxics Release Inventory (TRI). Based on Miles and Snow’s (1978, 2003) organizational theory, we consider the environmental inefficiency of Prospector and Defender business strategy types. Using a large sample of U.S. data spanning the period 1990–2014, we find that prospector-type firms reduce their toxic chemicals, relative to defender-type strategy firms. Our findings remain robust to fixed effects regression, 2SLS analysis, and the Granger-Causality test. This study offers useful insights to environmentally concerned policymakers, regulators, and investment strategists. From a practical point of view, our results suggest that a firm’s business strategy could determine how it responds to the need for protecting the natural environment. By integrating strategic management and environmental sustainability research, we offer new insights into how business strategies shape firms’ responses to environmental efficiency.

FIRM STRATEGY AND INNOVATION DYNAMICS: A CONCEPTUAL MODEL OF INNOVATION COMPETITION

Abstract. Firms of different business strategy types reveal different behavioural patterns in their innovation and business performance while facing various difficulties as they seek to adapt to a turbulent competitive environment. Accordingly, we want to make progress by using the dynamic view, which follows the Schumpeterian perspective of firm behaviour through innovation (business) strategy. We advocate a dynamic approach to the strategic and behavioural patterns influencing business performance that is appropriate for small and mediumsized firms as well as giant corporations in highly competitive industries and catching-up economies. Thus, by combining different theoretical approaches we develop an alternative conceptual ‘cost-advantage leader-follower’ (CALF) model of innovation for when firms are developing cost-cutting process inventions.

Artificial Neural Network and Analytical Hierarchy Process Integration: A Tool to Estimate Business Strategy of Bank

The disruption has been occurring in financial services. Rethinking new strategy of banking is needed to make a sustainable competitive advantage innovation in organizations. The four types of business strategy for banks are prospector, analyzer, defender, and reactor. Studies mentioned that formulating strategy is very costly, time consuming, and comprehensive analysis. The banks have to get rid of execution time inefficiency, lack of flexibility, and lack of ability to present several scenarios in the dynamic business environment. The purpose of this study is to present an integrated intelligence algorithm for estimating strategic resources of the bank strategy in Indonesia. The algorithm has two basic modules which are artificial neural network (ANN) and analytical hierarchy process (AHP). ANN is utilized as an inductive algorithm in discovering predictive strategy of the bank and used to explain the strategic resources which improved in forward. AHP has the capability to handle multi-level decision-making structure with use of expert judgments in pairwise comparison process. AHP is used to measure the weight of the resources and the score is used to determine the strategy. The empirical results indicate that ANN and AHP integration is proved to predict the business strategy of the bank. The strategy choice appropriate with the condition of bank's resources. This framework can be implemented to help banker for the decision making in bank operation. Keywords: business strategy, ANN, AHP, resources

The use of cluster analysis in entrepreneurship research: Review of past research and future directions

ABSTRACT Cluster analysis (CA) has been used in many diverse disciplines to develop classifications or taxonomies. In the entrepreneurship literature, cluster analysis has been used to test theory as well as to develop new theory, for example, by creating taxonomies of types of entrepreneurs, firms, and business strategies. This paper reviews the major studies using clustering techniques in top entrepreneurship focused journals from 1990–2019. The data show that cluster analysis is being used less frequently in the entrepreneurship field. Some suggestions for how and where it can be appropriately used in future research are provided.