This econometric model presents exactly the impact of each generic strategy on company performance, and these results have a positive impact on managers' decision-making and on the enrichment of strategic literature related to the use of Porter's generic strategies and their impact on company performance. The econometric results suggest that following a differentiation strategy provides greater company performance compared to two other generic Porter strategies (low-cost strategy or focus strategy) that also have a positive impact. Allen RS, Helms MM (200) Linking strategic practices and organizational performance with Porter's generic strategies. With regard to organizational strategies, organizations are referred to as “specialists” if they can only survive with a limited range of resources.
The findings in this article enrich the strategic literature with empirical evidence and offer business strategists the opportunity to choose the path that will allow their organizations to survive, increase profits and increase market share. Porter emphasized that if companies want to have a strategy to achieve competitive advantage, they must follow three strategies, which he called generic strategies. Medium and large companies can only effectively apply approach-based strategies in combination with strategies based on differentiation or cost leadership. In this section, the discussion will delve into Porter's generic strategies and their relationship to company performance.
Results of this study on the process of the impact of Porter's generic strategies on company performance. Testing the hypotheses of this study will fill the gap in existing strategic literature addressing the relationship between Porter's generic strategies and company performance. Therefore, based on the existing literature on strategy, the relationship between Porter's generic strategy and company performance will be presented. The application of Porter's generic strategies allows companies to successfully achieve the essential purposes of each company, which are to survive, be profitable and increase market share.