In this study an in depth investigation of successful competitive strategies for small to medium-sized enterprises (SMEs) is undertaken. The overall aim of this study is to analyse the strategic orientation of UK Manufacturing SMEs. In the process, it will test Porter’s (1980, 1985) theoretical framework of generic strategies and thus evaluate firms’ preferred strategic synthesis. It will, therefore, test the efficacy of the value chain and develop any specific pattern that relates to a combination strategy.
The investigation of the above objectives is undertaken utilising a mixed research methodology with the purpose of examining the applicability of existing competitive strategy frameworks (phase 1) and testing a new theoretical framework that incorporates additional dimensions of strategy (phase 2). During phase 1, Porter’s framework is employed to investigate SMEs’ strategic orientation as a means to achieve sustainable competitive advantage. A semi-structured questionnaire is employed and the analysis is carried out by means of factor and cluster analysis to identify strategic variables currently employed by SMEs. During phase 2, the theoretical framework is operationalised to bridge the gap within the literature and existing empirical research. Its purpose is to identify forms of successful competitive strategies of UK MSMEs as they are formulated and implemented in firms’ value chain activities. The data was collected through a number of semi-structured interviews and the analysis was based on data categorisation.
The findings indicate that Porter’s (1980) single generic strategies are not the best option for UK MSMEs for gaining competitive advantage and that the competitive strategy of successful MSMEs differs from that of the less successful ones. Successful UK MSMEs develop competitive strategies that are characterised by a combination of strategies as they are formulated within firms’ value chain activities. Although, during the evaluation of strategic synthesis at value chain level, the data analysis demonstrated that not all forms of combination strategies can deliver a high performance. One of the significant findings to emerge from this study is that the value chain framework is essential when analysing forms of successful competitive strategies of UK MSMEs. The results of this investigation also show that generalisations and previous recommendations regarding successful MSMEs competitive strategy should be interpreted with caution.
Table of Contents
- Abstract
- Acknowledgements
Objectives and Key Themes
The main objective of this study is to analyze the strategic orientation of UK manufacturing SMEs, testing Porter's framework of generic strategies and evaluating firms' preferred strategic synthesis. It aims to investigate the relationship between value chain activities and generic strategies in achieving sustainable competitive advantage. The study employs a mixed methodology, first investigating the applicability of existing frameworks, and then testing a new framework incorporating additional dimensions of strategy.
- Competitive strategies of UK manufacturing SMEs
- Applicability of Porter's generic strategies to SMEs
- Relationship between value chain activities and competitive strategy
- Development of a new theoretical framework for competitive strategy in SMEs
- Successful competitive strategy formulation and implementation within the value chain
Chapter Summaries
Abstract: This study investigates successful competitive strategies for small to medium-sized enterprises (SMEs), aiming to analyze the strategic orientation of UK manufacturing SMEs and test Porter's theoretical framework of generic strategies. A mixed research methodology is used, first employing Porter's framework to investigate SMEs' strategic orientation, and then operationalizing a new theoretical framework to identify successful competitive strategies formulated and implemented within firms' value chain activities. Findings suggest that Porter's single generic strategies are not optimal for UK MSMEs, and successful MSMEs utilize combination strategies within their value chain activities. The study emphasizes the importance of the value chain framework in analyzing successful competitive strategies and cautions against generalizations regarding successful SME competitive strategies. The findings suggest modifications to Porter's model and emphasize the need for UK MSME managers to recognize the formulation of successful competitive strategies within the value chain, often involving simultaneous pursuit of differentiation and low-cost strategies.
Keywords
Small and Medium-sized Enterprises (SMEs), competitive strategy, Porter's generic strategies, value chain analysis, sustainable competitive advantage, UK manufacturing, mixed research methodology, strategic orientation, combination strategies.
Frequently Asked Questions: Analysis of Competitive Strategies in UK Manufacturing SMEs
What is the main objective of this study?
The study's primary goal is to analyze the strategic orientation of UK manufacturing SMEs. It tests the applicability of Porter's generic strategies framework and explores how firms combine strategies to achieve a sustainable competitive advantage. It investigates the relationship between value chain activities and the chosen generic strategies.
What methodologies are used in this study?
The research employs a mixed methodology. It begins by assessing the applicability of existing frameworks, specifically Porter's model, to the strategic orientation of SMEs. Then, it introduces and tests a new theoretical framework that incorporates additional dimensions of strategy, focusing on how strategy is implemented within the value chain.
What are the key themes explored in this study?
Key themes include the competitive strategies of UK manufacturing SMEs, the applicability of Porter's generic strategies to SMEs, the relationship between value chain activities and competitive strategy, the development of a new theoretical framework for SME competitive strategy, and successful competitive strategy formulation and implementation within the value chain.
What are the key findings of the study?
The study finds that Porter's single generic strategies are often not optimal for UK manufacturing SMEs. Successful SMEs tend to utilize combination strategies, simultaneously pursuing differentiation and low-cost strategies within their value chain activities. The research highlights the critical role of the value chain framework in analyzing successful competitive strategies and cautions against generalizations about successful SME strategies. The findings suggest modifications to Porter's model.
What is the significance of the value chain in this study?
The value chain plays a central role. The study emphasizes that successful competitive strategy formulation and implementation in SMEs often happens within the context of their value chain activities. Analyzing the value chain is crucial for understanding how SMEs achieve and maintain competitive advantage.
What are the key implications for UK manufacturing SME managers?
The study suggests that UK MSME managers should recognize the importance of formulating successful competitive strategies within their value chain, often involving a combination of differentiation and low-cost approaches. They should be aware of the limitations of applying Porter's generic strategies in a simplistic manner.
What are the keywords associated with this study?
Small and Medium-sized Enterprises (SMEs), competitive strategy, Porter's generic strategies, value chain analysis, sustainable competitive advantage, UK manufacturing, mixed research methodology, strategic orientation, combination strategies.
- Quote paper
- Dr. Antonios Michail (Author), 2011, An investigation of the relationship between value chain activities and generic strategies in small and medium-sized enterprises in UK Manufacturing, Munich, GRIN Verlag, https://www.grin.com/document/183908
