Characteristics of organizational structure relating to hybrid competitive strategy: Implications for performance

a r t i c l e i n f o This study examines the characteristics of organizational structure that relate to hybrid competitive strategies. Such strategies seek to obtain higher performance levels by simultaneously emphasizing high differentiation and low-cost levels. In addition, this paper analyzes the mediating role of competitive strategy in the relationship between organizational structure and firm performance. The study examines a sample of large Spanish firms belonging to different sectors. The findings reveal that hybrid competitive strategy influences firm performance positively. Similarly, organizational complexity and the existence of formalization positively influence hybrid competitive strategy, whereas centralization has a negative influence. Organizational structure does not exert a direct influence on performance, but an indirect one, through hybrid competitive strategy. In the field of competitive strategy, some studies highlight the use of hybrid competitive strategies (which emphasize both low costs and differentiation) and defend their use to achieve a better performance No study appears to be available that analyzes empirically the characteristics of organizational design that associate with the development of those hybrid strategies. Some studies point out that external pressure and competition force organizations to abandon mechanistic organizational forms and to design more flexible, but a central and important question is whether these organic, flexible forms are appropriate for the development of hybrid competitive strategies. Thus, a need is apparent for research on the attributes of organizational structures that relate to hybrid competitive strategies. The study here examines the characteristics of organizational structure that relate to hybrid competitive strategies, which seek to obtain higher performance levels. In addition, the study analyzes the mediating role of competitive strategy in the relationship between organizational structure and firm performance. This study aims to make several contributions. First, this study develops theoretical ideas with regard to the relationship between hybrid competitive strategies and organizational design and their impact on performance. Second, from a methodological point of view, the model proposed in this paper uses a molar second-order factor to measure hybrid competitive strategy. In other words, the study conceptualizes hybrid competitive strategy as an emergent construct formed from formative strategic dimensions rather than a reflective construct (Diamantopoulos, 2008; Podsakoff et al., 2006). The findings show that the existence of formalization, complexity and decentralization have a positive influence on hybrid competitive strategy, and the latter positively influences firm performance, which supports a mediating effect of the competitive strategy on the relationship between …