Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances

Sirajuddin Omsa; Ibrahim H. Abdullah; Hisnol Jamali

doi:doi:10.11648/j.sjbm.20170501.12

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Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances

Sirajuddin Omsa, Ibrahim H. Abdullah, Hisnol Jamali

Published in Science Journal of Business and Management (Volume 5, Issue 1)

Received: 29 December 2016 Accepted: 9 January 2017 Published: 26 January 2017

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Abstract

Five competitive forces that comprise bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitute products or services, and intensity of rivalries have been studied by many researchers for several years. However, linking them with Porter’s generic strategy in order to gain financial and market performance in the Micro, Small and Medium Enterprises (MSMEs) context is very rare. The main purpose of this study is to analyze how those five competitive forces affect generic strategies developed by Porter and how the generic strategies affect firm performances. Questionnaire, survey and deep interview were conducted to figure out the implemented generic strategies by the owners of MSMEs of wooden furniture in East Java, Indonesia. Smart partial least square (PLS) was used to analyse the data. The results show that power of buyers (PoB) significantly affects only differentiation strategy (DS), power of supplies (PoS) significantly affects cost leadership strategy (CLS) and focus strategy (FS) but does not significantly affect differentiation strategy (DS), and threat of rivalries (ToR) significantly affects differentiation strategy (DS) and focus strategy (FC). In regards to the relationship between generic strategies and firm performances (FP), the results of this study show that both DS and FS significantly affect FP, while CLS does not significantly affect FP. Based on these findings, it is suggested that the owners of MSMEs wooden furniture in East Java (Indonesia) consider PoB, PoS, and ToR before performing DS and FS to gain much greater firm performances in the future.

Published in	Science Journal of Business and Management (Volume 5, Issue 1)
DOI	10.11648/j.sjbm.20170501.12
Page(s)	9-16
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2017. Published by Science Publishing Group

Keywords

Power of Buyers, Power of Suppliers, Threat of Rivalries, Cost Leadership Strategy, Differentiation Strategy, Focus Strategy, Firm Performance

References

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APA Style

Sirajuddin Omsa, Ibrahim H. Abdullah, Hisnol Jamali. (2017). Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances. Science Journal of Business and Management, 5(1), 9-16. https://doi.org/10.11648/j.sjbm.20170501.12

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ACS Style

Sirajuddin Omsa; Ibrahim H. Abdullah; Hisnol Jamali. Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances. Sci. J. Bus. Manag. 2017, 5(1), 9-16. doi: 10.11648/j.sjbm.20170501.12

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AMA Style

Sirajuddin Omsa, Ibrahim H. Abdullah, Hisnol Jamali. Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances. Sci J Bus Manag. 2017;5(1):9-16. doi: 10.11648/j.sjbm.20170501.12

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@article{10.11648/j.sjbm.20170501.12,
  author = {Sirajuddin Omsa and Ibrahim H. Abdullah and Hisnol Jamali},
  title = {Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances},
  journal = {Science Journal of Business and Management},
  volume = {5},
  number = {1},
  pages = {9-16},
  doi = {10.11648/j.sjbm.20170501.12},
  url = {https://doi.org/10.11648/j.sjbm.20170501.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.sjbm.20170501.12},
  abstract = {Five competitive forces that comprise bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitute products or services, and intensity of rivalries have been studied by many researchers for several years. However, linking them with Porter’s generic strategy in order to gain financial and market performance in the Micro, Small and Medium Enterprises (MSMEs) context is very rare. The main purpose of this study is to analyze how those five competitive forces affect generic strategies developed by Porter and how the generic strategies affect firm performances. Questionnaire, survey and deep interview were conducted to figure out the implemented generic strategies by the owners of MSMEs of wooden furniture in East Java, Indonesia. Smart partial least square (PLS) was used to analyse the data. The results show that power of buyers (PoB) significantly affects only differentiation strategy (DS), power of supplies (PoS) significantly affects cost leadership strategy (CLS) and focus strategy (FS) but does not significantly affect differentiation strategy (DS), and threat of rivalries (ToR) significantly affects differentiation strategy (DS) and focus strategy (FC). In regards to the relationship between generic strategies and firm performances (FP), the results of this study show that both DS and FS significantly affect FP, while CLS does not significantly affect FP. Based on these findings, it is suggested that the owners of MSMEs wooden furniture in East Java (Indonesia) consider PoB, PoS, and ToR before performing DS and FS to gain much greater firm performances in the future.},
 year = {2017}
}

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TY  - JOUR
T1  - Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances
AU  - Sirajuddin Omsa
AU  - Ibrahim H. Abdullah
AU  - Hisnol Jamali
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DO  - 10.11648/j.sjbm.20170501.12
T2  - Science Journal of Business and Management
JF  - Science Journal of Business and Management
JO  - Science Journal of Business and Management
SP  - 9
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PB  - Science Publishing Group
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UR  - https://doi.org/10.11648/j.sjbm.20170501.12
AB  - Five competitive forces that comprise bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitute products or services, and intensity of rivalries have been studied by many researchers for several years. However, linking them with Porter’s generic strategy in order to gain financial and market performance in the Micro, Small and Medium Enterprises (MSMEs) context is very rare. The main purpose of this study is to analyze how those five competitive forces affect generic strategies developed by Porter and how the generic strategies affect firm performances. Questionnaire, survey and deep interview were conducted to figure out the implemented generic strategies by the owners of MSMEs of wooden furniture in East Java, Indonesia. Smart partial least square (PLS) was used to analyse the data. The results show that power of buyers (PoB) significantly affects only differentiation strategy (DS), power of supplies (PoS) significantly affects cost leadership strategy (CLS) and focus strategy (FS) but does not significantly affect differentiation strategy (DS), and threat of rivalries (ToR) significantly affects differentiation strategy (DS) and focus strategy (FC). In regards to the relationship between generic strategies and firm performances (FP), the results of this study show that both DS and FS significantly affect FP, while CLS does not significantly affect FP. Based on these findings, it is suggested that the owners of MSMEs wooden furniture in East Java (Indonesia) consider PoB, PoS, and ToR before performing DS and FS to gain much greater firm performances in the future.
VL  - 5
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Author Information

Sirajuddin Omsa

Department of Accounting, State Polytechnic of Ujung Pandang, Makassar, Indonesia
Ibrahim H. Abdullah

Department of Management Science, Economic Faculty, Muhammadiyah University, Mataram, Indonesia
Hisnol Jamali

Program Pascasarjana (PPS) Magister Manajemen (MM), Sekolah Tinggi Ilmu Ekonomi Makassar (STIEM) Bongaya, Makassar, Indonesia

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APA Style

Sirajuddin Omsa, Ibrahim H. Abdullah, Hisnol Jamali. (2017). Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances. Science Journal of Business and Management, 5(1), 9-16. https://doi.org/10.11648/j.sjbm.20170501.12

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ACS Style

Sirajuddin Omsa; Ibrahim H. Abdullah; Hisnol Jamali. Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances. Sci. J. Bus. Manag. 2017, 5(1), 9-16. doi: 10.11648/j.sjbm.20170501.12

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AMA Style

Sirajuddin Omsa, Ibrahim H. Abdullah, Hisnol Jamali. Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances. Sci J Bus Manag. 2017;5(1):9-16. doi: 10.11648/j.sjbm.20170501.12

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@article{10.11648/j.sjbm.20170501.12,
  author = {Sirajuddin Omsa and Ibrahim H. Abdullah and Hisnol Jamali},
  title = {Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances},
  journal = {Science Journal of Business and Management},
  volume = {5},
  number = {1},
  pages = {9-16},
  doi = {10.11648/j.sjbm.20170501.12},
  url = {https://doi.org/10.11648/j.sjbm.20170501.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.sjbm.20170501.12},
  abstract = {Five competitive forces that comprise bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitute products or services, and intensity of rivalries have been studied by many researchers for several years. However, linking them with Porter’s generic strategy in order to gain financial and market performance in the Micro, Small and Medium Enterprises (MSMEs) context is very rare. The main purpose of this study is to analyze how those five competitive forces affect generic strategies developed by Porter and how the generic strategies affect firm performances. Questionnaire, survey and deep interview were conducted to figure out the implemented generic strategies by the owners of MSMEs of wooden furniture in East Java, Indonesia. Smart partial least square (PLS) was used to analyse the data. The results show that power of buyers (PoB) significantly affects only differentiation strategy (DS), power of supplies (PoS) significantly affects cost leadership strategy (CLS) and focus strategy (FS) but does not significantly affect differentiation strategy (DS), and threat of rivalries (ToR) significantly affects differentiation strategy (DS) and focus strategy (FC). In regards to the relationship between generic strategies and firm performances (FP), the results of this study show that both DS and FS significantly affect FP, while CLS does not significantly affect FP. Based on these findings, it is suggested that the owners of MSMEs wooden furniture in East Java (Indonesia) consider PoB, PoS, and ToR before performing DS and FS to gain much greater firm performances in the future.},
 year = {2017}
}

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TY  - JOUR
T1  - Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances
AU  - Sirajuddin Omsa
AU  - Ibrahim H. Abdullah
AU  - Hisnol Jamali
Y1  - 2017/01/26
PY  - 2017
N1  - https://doi.org/10.11648/j.sjbm.20170501.12
DO  - 10.11648/j.sjbm.20170501.12
T2  - Science Journal of Business and Management
JF  - Science Journal of Business and Management
JO  - Science Journal of Business and Management
SP  - 9
EP  - 16
PB  - Science Publishing Group
SN  - 2331-0634
UR  - https://doi.org/10.11648/j.sjbm.20170501.12
AB  - Five competitive forces that comprise bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitute products or services, and intensity of rivalries have been studied by many researchers for several years. However, linking them with Porter’s generic strategy in order to gain financial and market performance in the Micro, Small and Medium Enterprises (MSMEs) context is very rare. The main purpose of this study is to analyze how those five competitive forces affect generic strategies developed by Porter and how the generic strategies affect firm performances. Questionnaire, survey and deep interview were conducted to figure out the implemented generic strategies by the owners of MSMEs of wooden furniture in East Java, Indonesia. Smart partial least square (PLS) was used to analyse the data. The results show that power of buyers (PoB) significantly affects only differentiation strategy (DS), power of supplies (PoS) significantly affects cost leadership strategy (CLS) and focus strategy (FS) but does not significantly affect differentiation strategy (DS), and threat of rivalries (ToR) significantly affects differentiation strategy (DS) and focus strategy (FC). In regards to the relationship between generic strategies and firm performances (FP), the results of this study show that both DS and FS significantly affect FP, while CLS does not significantly affect FP. Based on these findings, it is suggested that the owners of MSMEs wooden furniture in East Java (Indonesia) consider PoB, PoS, and ToR before performing DS and FS to gain much greater firm performances in the future.
VL  - 5
IS  - 1
ER  -

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