Conventional Strategy Frameworks and Their Applicability to SMEs: Lessons From a Case Study

Authors

  • Khai Sheang Lee National University of Singapore
  • Guan Hua Lim National University of Singapore
  • Soo Jiuan Tan National University of Singapore

Abstract

Two of the most popular strategy frameworks in the literature are the portfolio approach in strategy decision-making and Porter's (1980)framework of 3 generic strategies. This paper examines in depth the applicability of these strategy approaches to small and medium size enterprises (SMEs) and complements this with a diagnosis of an actual case study of a SME competing against a bigger firm. SMEs are generally defined as businesses having not more than 500 employees (Cox, Hooley and Lynch, 1994). In our diagnosis, we highlight the hidden assumptions and flaws of these popular strategy approaches, which made them unsuitable for SMEs, who faced resource constraints and disadvantages. In doing so, we demonstrate the importance of adopting a different perspective in SME strategy formulation, one that could explicitly consider the impact of SMEs' resource constraints and competitive reactions of bigger firms in the market, Lee, Lim and Tan's (1999) model is then extended and used to show that there are alternative strategies to niching/or SMEs.

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Published

1999-01-17

Issue

Vol. 10 No. 1 (1999)

Section

Articles

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How to Cite

Conventional Strategy Frameworks and Their Applicability to SMEs: Lessons From a Case Study. (1999). Journal of Small Business Strategy (archive Only), 10(1), 25-40. https://libjournals.mtsu.edu/index.php/jsbs/article/view/400