Hybrid competitive strategies, organizational structure, and firm performance

Abstract

This paper analyzes the internal characteristics of organizational structure which have an influence on the development of hybrid competitive strategies and their link to firm performance. The study examines a sample of large Spanish firms belonging to different sectors by means of the Partial Least Squares (PLS) technique, using formative dimensions for competitive strategy and organizational structure. The results reveal that the strategies which simultaneously emphasize high differentiation and low cost levels influence firm performance positively, and that the possible organizational support needed to reach an appropriate hybrid strategy may be the design of organic, flexible organizations with mechanical components. Likewise, it has been checked that the competitive strategy acts as a factor mediating the influence exerted by organizational structure on firm performance.