Business strategy, technology policy and firm performance in the Singapore environment

Abstract

As Singapore responds to global competition, there is an increased recognition that future market success will be significantly dependent on technological development. As a result of this trend, many local firms have expanded their acquisition of advanced technologies and, also, their introduction of technologically sophisticated products. These changes have alerted many local firms to adopt technology policies that are strategically consistent with their business missions. The purpose of this study is to explore the association between a firm’s approach to its manufacturing operations with its technological choices and financial performance. The report presents an analysis of the relationships between specific business strategy dimensions, technological choices, organizational structures and firm performance, in the local context. Data were collected from 37 firms representing various industries in the manufacturing sector. Cluster analysis of the data exhibited three distinctive categories of manufacturing firms. The findings indicated that specialty-product firms were aggressive in their marketing activities, while commodity-product firms offer an extensive product line; and expectedly the third cluster comprised a "middle-of-the-road" category which firms scored moderately on the four business strategy dimensions. Further, the study also shows that technology choices vary widely across firms with different configurations of business strategy, and that business strategy is an important contingency between technology policies and firm performance.