Measuring the Effectiveness of Managerial Action in SMEs: An Empirical Analysis of Management's Response to Industry Competitive Forces

Purpose – The paper's purpose is to investigate the direct and indirect effects of industry competitive forces on strategy‐making and performance in small‐to‐medium‐sized manufacturing companies.Design/methodology/approach – The paper's approach is a survey design with structural equation modeling used for hypotheses testing.Findings – The findings provide strong support for the mitigating role of managerial action through the strategy‐making process and indications that this is true regardless of small‐to‐medium‐sized enterprise (SME) size. Also, automotive‐manufacturing SMEs seem to exhibit higher levels of competitive factors compared with non‐automotive manufacturing SMEs.Research limitations/implications – The major limitation of this research is that the survey was taken in the Mid‐western USA and involved only SME manufacturing organizations. The research should be extended to other geographic regions, industry types, and larger organizations.Practical implications – Many small company managers fee...

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