Application of Michael Porter’s Generic Strategy to a local Oleochemicals Manufacturer: A Case Study in Malaysia
Ho Yeow Chung
MBA Student: International Executive Master of Business Administration
(Strategic and Project Management)
Paris Graduate School of Management, France
March, 2012
Abstract
The world economy downturn since 2008 has directly impacted the performance of firms with no exceptions. Oleochemicals industry in Malaysia has experienced a difficult few years. Porter (1980) suggested that firms could achieve success if they adopted a Cost-leadership or Differentiation strategy. This research was conducted with three aims in mind:
Questionnaires were distributed amongst managers and executives and data were analysed by using SPSS version 15.0. The findings revealed that the strategy adopted by the company was ‘Stuck-in-the-middle’. In the perception of employees, the strategy adopted by the company was efficient in some ways, and the perception on strategy adoption of managers and executives did not differ from each other.
The findings of the sub-study in strategy efficiency showed that employees who had worked eleven years or more in the company tended to disagree with the strategy, whereas those who had worked there less than ten years tended to agree.
Based on the findings, it is suggested that the management of company should rethink and redesign its strategy, as Porter’s generic strategies are mutually exclusive and they use different sets of resources (Porter, 1985).
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