SME's Competitive Strategy

1. ARTICLE REVIEW
“Proposition d’une grille de
classification pour
l’identification de la logique
stratégique des petites et
moyennes entreprises”
Gerald d’Amboise
SUMMARY PRESENTATION BY FERRY JAOLIS
Faculte des sciences de l’administration
Christiane Fortin Universite Laval, CA

2. PRESENTATION PLAN
 Issue
 Key Ideas, Method, Data
 Review
 Critics
 Suggestions
 References

3.  Decision-making
autonomy,
 < $20 M annual sales,
 < 500 employees,
 Not dominant in their
sector.

4. Studies on Large Firms Studies on SMEs
• Robinson and
Pearce (1988)
• Bourgeois (1980)
• Bamberger (1988)
• Hambrick (1980) GENERAL SPECIFIC • Davig (1986)
• Chaganti, Chaganti
• Chrisman, Hofer and
and Mahajan (1989)
Boulton (1988) • Miller (1988)
• Etc.
1980 1989
Competitive Strategy
4
Strategy
3
NEW GRID
2 Base Models
1

5. Corporate Strategy GENERAL
• Bourgeois (1980)
INTERNAL
Business Strategy TASK/IMMEDIATE
Competitive Strategy
4
Strategy
3
2
1

6. STUDIES ON STRATEGIC BEHAVIOR OF SMEs
 Robinson and Pearce (1988) -- > 22 types of competitive factors.
 Bamberger (1988) -- > 26 competitive factors.
 Davig (1986) studied the competitive strategies of 60 enterprises.
 Chaganti, Chaganti and Mahajan (1989) -- > 11 elements to measure the
competitive strategies of 192 small manufacturing enterprises
 Miller (1988) employed 20 factors to study the
strategic dimension of 89 enterprises.
TYPOLOGIES
Growing interest / studies with no ‘representative’ model
1980 1990
Competitive Strategy
4
3
2
1

7. PROBLEMS ON SMEs STUDIES
TYPOLOGY
• Growing typologies
• Non-integrative study
METHOD
results
• Cluster analysis
• Unique terms in every
• Factorial analysis
studies
• Specific to industries,
product type, markets, etc.
Competitive Strategy
4
3
2
1

8. 4
3
2 Base Models
1

9.  Industry-wide --
regardless of sizes,
market share, etc.
 Exhaustive (a non
‘stuck-in-the-middle’
concept)
4
3
2 Base Models
1

10. 4
3
NEW GRID
2
1

11. large
Porter
generic specific
Porter
Miles &
Snow SMEs
small to
medium

12. CRITICS
• Rely too strongly on generic strategy (should it be generic from
generic or generic from specific (SMEs in particular)?
• Place lower emphasis on competitive factors studies of SMEs.
• Lack of sound reason when choosing base model
• Merely an ‘another’ expansion of Porter’s model, no new
‘representative’ term for SMEs strategy
Suggestions…
• Pay more attention to factors influencing strategic orientation of SMEs (which were
written in the article already – price, product, delivery times, etc.)
• The ideas of factor analysis is good enough to classify these SMEs strategy (the
author should put more emphasis on this)
• Start with defining more on the term ‘competitor’

13. large
Competitive Strategies
Size of Competition
Cost Leadership Differentiation Hybrid
Market Leader
Equal
Nicher
generic specific
SME’s Strategic Competitive Strategies
Target Cost Leadership Differentiation Hybrid
Segment ignored by
market leader
Segment served by
market leader
Segment served by
equal SMEs SMEs
Segment served by
smaller nichers
small to
medium

14. REFERENCES
• http://www.scribd.com/doc/20597525/Chapter-3-Three-Generic-
Competitive-Strategies-For-SMEs, “Generic competitive strategy for SMEs”,
January 24th, 2011.
• http://www.ashridge.org.uk/website/content.nsf/FileLibrary/1E056A2490064
92B8025742E00360549/$file/360_Spring08.pdf, “Generic strategies: a
substitute for thinking?”, January 24th, 2012.
• http://www.sbaer.uca.edu/research/asbe/1998/pdf/06.pdf, "Stuck in the
middle: for retailers, perhaps not such a bad place to be”, January 24th, 2012.
• http://www.quickmba.com/strategy/generic.shtml, “Porter’s generic
strategy”, January 24th, 2012.
• http://www.google.com/url?sa=t&rct=j&q=miles%20and%20snow%20strateg
y&source=web&cd=4&sqi=2&ved=0CDsQFjAD&url=http%3A%2F%2Fciteseer
x.ist.psu.edu%2Fviewdoc%2Fdownload%3Fdoi%3D10.1.1.125.803%26rep%3
Drep1%26type%3Dpdf&ei=bRkgT7z2FMPoOY7QnYEM&usg=AFQjCNH7uYLQ
Ht_C9Zm9PTl9eF4hHmbrEw&sig2=59n9A849RJd5IWuSF3oZ8w, “Miles and
Snow’s strategy model in the context of small firms”, Fernando A. P. Gimenez,
January 24th, 2012.

15. THE SMEs
 Decision-making autonomy,
 < $20 M annual sales,
 < 500 employees,
 Not dominant in their
sector.

16. RESEARCH FRAMEWORK
Step 1 Step 2 Step 3 Step 4
Strategy Competitive Base Models New Grid
Strategy
• Corporate • Disctinctive • Miles & Snow • Strategic Logic
Strategy Competence • Porter of SMEs
• Business • Competitive
Strategy Advantage
4
3
2
1