Differentiation Strategy and Cost Leadership Strategy: Their Contribution to Achieving Sustainable Financial Performance

Juniarti Juniarti (), Clarissa Simanjaya, Marcella Chandra and Zenia Estella Soesetyo
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Juniarti Juniarti: Petra Christian University
Clarissa Simanjaya: Petra Christian University
Marcella Chandra: Petra Christian University
Zenia Estella Soesetyo: Petra Christian University

A chapter in Digital Economy and New Value Creation, 2022, pp 197-219 from Springer

Abstract: Abstract This research aims to study the influence of differentiation and cost-leadership strategy on sustainable financial performance with innovation as the moderator variable. This research uses the last 5 years financial report of go-public companies in South-East Asia, with a total of 250 firm years. In the early stage of the research, the companies are grouped into their respective strategy. From that grouping, each strategy is then measured. The researcher uses 5 measurements to test the strategies, 2 for differentiation strategy and 3 for cost-leadership strategy. The finding of this research is that differentiation positively influences sustainable financial performance, with innovation as the moderator variable. However, these findings are not proved in cost leadership strategy. Innovation shows partially influences to the achievement of sustainable financial performance. This research contributes to adding the innovation factor that strengthens the relationship between the successes of a strategy with the sustainable financial performance so that the result can be more consistent.

Keywords: Strategy; Differentiation; Cost-leadership; Financial performance; Sustainable financial performance; Innovation (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-031-07265-9_16

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DOI: 10.1007/978-3-031-07265-9_16

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