Competitive Advantage: Mediator of Diversification and Performance

Abstract

Abstract. Study relates to the correlation between diversification strategy and corporate sustainability performance, many of them are conducted in service industry. In this study, it is explained about competitive advantage that also becomes the important attention on the creation of corporate sustainability performance. But study relates to mediating effect of competitive advantage on the correlation of diversification and corporate sustainability performance, has not reviewed especially in-service industry and it becomes the focus of this study. The study is conducted by case study on Building Automation System industry in Indonesia as one of service industries that needs corporate sustainability performance. There are 43 directors of business unit which is taken their data by questionnaire as respondent, with using Structural Equation Model analysis. This finding is stated that corporate sustainability performance can be achieved well through the implementation of diversification strategy. But, competitive advantage is unable mediating diversification strategy on the improvement of corporate sustainability performance. This finding is useful to support Indonesia government's program in facing issue of "Saving Energy", through the review of Building Automation System industry. IntroductionEvery company both product and service, is truly operating with the final objective to get the optimum of company performance [1]. Those cases become a task for Chief Executive Officer (CEO) to ensure shareholders. However, for company that is still in developing phase, corporate sustainability performance becomes a must [2]. To get corporate sustainability performance, company uses some strategies. Thus the implementation of that strategy is not often misdirected [3]. As the result, the expected performance is not achieved well. So, it is needed clarity of goals of business performance that want to be achieved, those goals are implemented on company strategy. The creation of company strategy is depend on resource, it can deliver to company to get competitive advantage [4]. Competitive advantage is one of source to corporate sustainability performance from company [5]. One of strategies that often used its relation to competitive advantage are diversification strategy [6]. Diversification strategy focuses on two cases which are company and product, every changing that is conducted to innovation and the creation of superior strategy is always needed diversification [7]. The strategy conducted on product through diversification, is one of attractive strategies to new and old consumer, and it is also useful to improve company competitive advantage [8]. Speed in adjusting competitive advantage is appropriate with market trending, it becomes a pillar from the creation of diversification strategy [9].

Modelling the significance of strategic orientation for competitive advantage and economic sustainability: the use of hybrid SEM–neural network analysis

“…Human capability is part of an organisation’s valuable assets to gain competitive advantage (Kamboj & Rahman, 2017 ). Most importantly, the capability to strategically meet customers’ needs ensures customer satisfaction, which is important for halal SMEs in their efforts to gain competitive advantage and sustainability (Sihite, 2018 ). Moreover, Correia et al ( 2020 ) confirmed the mediating role of competitive advantage in the relationship between dynamic capability and business sustainability.…”

Pengaruh Orientasi Pasar, Inovasi Dan Kreativitas Produk Terhadap Kinerja Industri Kreatif Untuk Mencapai Keunggulan Bersaing

“…Bersaing dan Kinerja Industri Kreatif Banyak penelitian yang mengungkap bahwa keberhasilan peningkatan kinerja industri tergantung bagaimana industri tersebut menciptakan keunggulan bersaing dalam menghadapi kompetitor khususnya di pasar baru seperti halnya penelitian Rose et al (2010), Majeed (2011), Husnah et al (2013, Ghasemi et al (2015), Davcik & Sharma (2016), Aryana et al (2017) dan Sihite (2018). Keunggulan bersaing berpengaruh positif dan signifikan terhadap kinerja industri.…”

“…Hasil penelitian ini membuktikan bahwa keunggulan bersaing berpengaruh positif dan signifikan terhadap kinerja industri. Temuan ini memperkuat penelitian-penelitian terdahulu seperti penelitian Zhou et al (2009) Sihite (2018). Kondisi ini menunjukkkan bahwa keunggulan bersaing adalah kunci untuk kinerja bisnis jangka panjang bagi industri kreatif.…”

Does Strategic Leadership Impact Competitive Advantage, Mediated by Diversification Strategy In the Manufacturing Industry?

“…Many manufacturers were unable to get up because the product research and development process was not running optimally. Diversification has a dominant impact on increasing competitive advantage (Sihite, 2018) .but research needs to be continued in the industrial sector automation system. In the banking sector, the diversification strategy has an important role in increasing competitive advantage (Wanjiru & Nzulwa, 2018).…”