Linking strategic practices and organizational performance to Porter's generic strategies

Purpose – While Porter's generic strategies are a widely accepted typology of strategic options for businesses, prior studies have not linked specific strategic practices with each generic strategy and explored the associations between the practices and overall organizational performance. The purpose of this paper is to propose and test the following two hypotheses: specific strategic practices (or tactics) can be identified which are associated with each generic Porter strategy; and there are specific strategic practices which are more strongly associated with higher levels of organizational performance within each generic strategy. Design/methodology/approach – To test these hypotheses, a questionnaire was developed and administered to a sample of 226 working adults. A factor analysis and regression analyses were used to analyze the data. Findings – Findings include a list of critical strategic practices significantly associated with organizational performance for each of Porter's generic strategies. Research limitations/implications – Future research would be advised to include a more geographically and randomly selected sample. Furthermore, the use of archival financial performance data is suggested. Practical implications – Suggestions for managers crafting strategies and reinforcing supporting strategic practices based on the findings of this research are discussed. Originality/value – This research has uncovered a core list of strategic practices which better defines each generic Porter strategy. The authors have also pinpointed an even smaller list of critical practices strongly associated with performance for each specific generic strategy.