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INDUSTRY VARIETY AND PERFORMANCE.

Authors :
Miles, Grant
Snow, Chales C.
Sharfman, Mark P.
Source :
Strategic Management Journal (John Wiley & Sons, Inc.) - 1980 to 2009; Mar93, Vol. 14 Issue 3, p163-177, 15p
Publication Year :
1993

Abstract

This study advances a nascent perspective in the strategic management literature: a focus on the beneficial effects of competition among firms in an industry. Such a perspective supplements the traditional view of competition as firm rivalry. The overall purpose of the study is to provide a theoretical foundation for the study of the mutual gains associated with industry competition. Because of its importance to several different organizational theories, the concept of variety is examined as a potential source of interfirm benefits. The influence of variety is observed in 12 industries, four each from the growth, mature, and decline stages of the life cycle. In each life-cycle stage, two of the industries have substantial amounts of foreign competition while the other two do not. The study's results support two broad conclusions. First, industry variety and performance are positively related, suggesting that interfirm benefits are most feasible in industries characterized by diversity among firms' competitive strategies. Second, as industries move through the life cycle, variety decreases, implying that both strategists and policymakers need to consider the impact on aggregate variety when evaluating prescriptions for the revitalization of declining industries. Implications of these findings are derived for researchers, practitioners, and policymakers. [ABSTRACT FROM AUTHOR]

Details

Language :
English
ISSN :
01432095
Volume :
14
Issue :
3
Database :
Complementary Index
Journal :
Strategic Management Journal (John Wiley & Sons, Inc.) - 1980 to 2009
Publication Type :
Academic Journal
Accession number :
12496686
Full Text :
https://doi.org/10.1002/smj.4250140302