An analysis of the Business Strategies Content and its Effects on Organizational Performance

Present study is an empirical test of the proposition that strategy content is a key determinant of organizational performance. Strategy content comprises two dimensions of strategic stance and strategic actions. Strategic stance is the extent to which a company is prospector, defender or reactor. Strategic action is the relative emphasis on product or service differentiation, low cost production and distribution, focus on a market niche or a combination of the above actions. Data were drawn from a survey of 129 manufacturing companies which have taken part in four seminars held by Isfahan Chamber of commerce, Isfahan mines and industries institute and Isfahan mine and Industry house, in the first three months of year 1389. The statistical results show that strategy content matters. Market share growth is positively associated with a prospector stance and negatively with a defender stance. ROI and profitability are negatively associated with a reactor stance. Furthermore companies which compete with a combination of differentiation and low cost strategic actions outperform their rivals. Also companies offering their products and services to a wide market will experience a better market share growth and overall performance in comparison to their rivals servicing a market niche.