Impact of Competitive Generic Strategies on Profitability of Non-life Insurance Companies in Nepal

Gautam Maharjan, M.Phil.-TU

Abstract: Organizations should have competitive generic strategies (i.e., cost leadership, differentiation, and focus) to achieve organizational objectives in the global market. The main purpose of this study is to analyse the impact of generic strategies on profitability of non-life insurance companies in Nepal. Out of 25 insurance companies registered in Beema Samiti, only 13 private-sector non-life insurance companies more than five years old have been selected as a sample. About 77 percent of the responses received are usable. Based on the analysis of correlation and multiple regressions, the study has found that only FS has positive impact on profitability. This means that the non-life insurance companies in Nepal have not completely following competitive generic strategies. The lack of awareness of insurance business can be the cause of reporting no impact of CLS as well as negative impacts of DS in the context of non-life insurance in Nepal. 1. Introduction Organisation should identify the distinct competencies for goal achievement and advancement. Hence, organizations should have a competitive strategy to achieve organizational objectives. Generic strategies framework was first presented in the book named Competitive Strategy: Techniques for Analyzing Industries and Competitors by Professor Michael Porter of the Harvard Business School in 1980 describing a business can maximize performance/ profitability and could use to achieve competitive advantage: cost leadership, differentiation and market focus. Being the framework constituted a major contribution to the development of the business strategy, these typologies are most notable in the business globally. Porter (1980, 1985) described that firms adopting the cost leadership strategy (CLS) aim to increase market share based on creating a low-cost position relative to their peers through operational efficiencies, performing similar activities better and more efficiently than rivals. The second is differentiation strategy (DS) which requires that the firm create something that is unique in the industry, thus permitting the firm to command higher than average prices. The third is a focus strategy (FS) that is concerned with market positioning strategy in which a firm concentrates on a particular group of customers, geographic markets, or product line segments. According to Porter (1980), a business attempting to combine the two ends up stuckin-middle. A notion that received considerable early support (Dess and Davis, 1984; Hambrick et al., 1982; Hawes & Crittendon, 1984) but was later challenged by a number of studies (Buzzell & Gale, 1987; Hall, 1993, Hill, 1988; Murray, 1988; Parnell, 1997; Phillips et al., 1983; Proff, 2000). The generic strategies, wherein the latter is the way in which companies can earn a price premium (Porter, 1996).
1

Mr. Maharjan is Teaching Assistant at Public Youth Campus, Tribhuvan University. He can be reached at maharjangautam@gmail.com

Miller (1988) examining Porter's (1980) generic strategies in consumer durable industries found that the cluster of business units that show distinct competencies in the areas of differentiation, cost leadership and focus dramatically outperform all other competitors. Parnell (1997) found that companies utilizing both cost-leadership and differentiation strategies are effectively more likely to enhance their financial performance and financial management. Porters (1980) typology has been criticized for its conceptual limitations, but its simplicity captures core concepts of strategic positioning that could be viewed as integral ingredients of distinct strategies (Mathur, 1988; Miles & Snow, 1978). Likely, Miles and Snows framework identified four alternativesprospectors, analyzers, defenders, and reactorsthe first three of which may lead to superior performance. The Miles and Snow (1978) typology focused on the process of adjusting to environmental change and uncertainty, and effectively takes into consideration the trade-off between external and internal strategic factors. Segev (1989) noted that Miles and Snows poor-performing, inconsistent reactor type may also be equated with Porters stuck-in-middle concept. In regard to the generic strategies and firms profitability, the following issues have been considered in the context of the non-life insurance companies in Nepal: i) ii) Do non-life insurance companies in Nepal follow generic strategies by considering or not internal and external environmental factors? Do non-life insurance companies in Nepal give priority to the adoption of cost leadership strategy, differentiation strategy, or focus strategy?

The study has set the following specific objectives: i. To analyse the effect of generic strategies on profitability by considering or not internal and external environmental factors in non-life insurance companies in Nepal.

ii. To identify which generic strategies (i.e., cost leadership, differentiation, or focus) have more affected the profitability of non-life insurance companies in Nepal. 2. Reviews of Related Empirical Studies and Hypotheses Development Thapa (2010) analysed competitive strategy and performance of the Nepalese Banking Industry. Eighteen 'A' listed commercial banks located in Kathmandu have been taken as a sample. It results that differentiation strategy is positively related to better performance and statistically significant. Focus strategy is positively related to performance but not statistically significant. Bhattarai (2010) examined the generic strategies and sustainability of financial performance of commercial banks in Nepal. The study sampled 8 out of 26 Nepalese commercial banks. The findings are that major efficiency strategy is better than the differentiation strategy for increasing sales growth, ROA stability and market price per share. Kaspal (2009) analysed the competitive business level strategies in Nepalese joint venture banks (JVB) and private domestic banks (PDB). It has more focused on differentiation strategy in the Nepalese banking industries but the PDBs do not have

stronger differentiation strategy than JVBs. The profitability strategy of JVBs is also stronger than PDBs. JVBs also have better competitive position than PDBs. Arias (2009) analysed Michael Porters generic strategies and its usage in a globalisation business environment. It was found that in the context of globalization, the generic strategies were not able anymore to describe completely a companys strategy today. Zaras strategy was initially the cost leadership one, then it effectively changed 10 years ago, to one more complex type of strategy described as one of differentiation without forgetting that its competitive advantage still comes from the cost leadership, brought along with market structural changes, higher competition, and the need of developing coherently the abroad markets. Zaras current strategy implies a level of complexity out of the Porters proposal, as the current Zaras turned with special internal capabilities. Candy (2009) investigated on resources, strategy and performance in the smaller firm. Less than 100 full time equivalent staffs each, from 500 firms were selected as a sample. It was found that strategy can play mediating role on the relationship between resources and firm performance. Only limited support for organisational resources combined with a strategy of cost leadership being positively associated with firm performance. The study reported a moderate support for a combination of physical resources and a cost leadership strategy being positively associated with firm performance. Kupka (2009) examines the customer to achieve the sustainable competitive advantage through relationship marketing. Three airlines: Ryanair, EasyJet and Air Berlin have been selected as a sample from the European market. The results showed that low cost strategy is more effective in Ryanair and EasyJet but differentiation strategy is more effective in Air Berlin in Europe. Thapa (2008) analysed generic strategies and performance benchmarking of commercial banks of Nepal. By selecting 18 commercial banks for three years starting from 2005 to July of 2007 as a sample, it was found that the low cost strategy is the most widely adopted strategy in generic group by commercial banks. The differentiation strategy has been followed by high and moderate performers but low performers have no significant differentiation strategy. Focus strategy is the least preferred strategy by banks. The moderating factors have supportive role for execution of strategy and better performance. Allen and Helms (2006) analysed linking strategic practices and organizational performance to Porter's generic strategies and administered to a sample of 226 working adults. Findings included a list of critical strategic practices significantly associated with organizational performance for each of Porters generic strategies. Koo, Koh and Nam (2004) examined Porter's competitive strategies in electronic virtual markets comparing two On-line business models. Out of 1,000 firms in South Korea, only 123 responses were utilised for sample form the survey. It results that Online firms incline to differentiation strategies but click-and-mortar firms prefer strategies based on market focus. Power and Hahn (2004) analysed critical competitive methods, generic strategies, and firm's performance. Questionnaires were sent to presidents of 443 US banks with total assets between $ 10 million and $ 1.5 billion operating within the New England states but only 98 were usable. The finding is that a cost leadership strategy provides a statistically significant performance advantage over banks that are stuck-in-the3

middle, a combined strategy. This study suggests that in the banking industry it may be difficult to generate superior returns using a differentiation or focus strategy. Pecotich, Purdie and Hattie (2003) evaluated the typologies of marketplace strategic actions in the Australian context. The results tended to support Porters formulation of cost leadership, differentiation and focus strategies. Kaymak (1998) examined business level strategies and performance in a global industry. It has been taken 14 Multi-national enterprises (MNE) and 13 domestic companies out of 27 firms as sample from the semiconductor industry to test the hypotheses. The finding is that domestic firms possess more of the low-cost and/or focus strategies than MNEs. Also, MNEs are not pursuing a differentiation strategy relative to domestic firms. However, overall MNEs do not have superior performance. Kotha and Vadlamani (1995) assessed generic strategies investigating of two competing typologies in discrete manufacturing industries. Based on a survey of executives in manufacturing firms, it was found that it provided support for Minzberg's typology and failed to support Porter's typologies. There is no study that would cover the generic strategies of non-life insurance companies operating in the context of Nepalese national market. As the service-oriented firms, the study in insurance industry is a unique part. The previous related studies were mostly concerned with manufacturing and banking sectors. The study of strategy and profitability in Nepalese context is another new area covered by this study, since no previous studies have touched upon it. Previous studies were in majority focused on the relationship between strategies and performances in different industry contexts but in this study, it has been attempted to apply impact of generic strategies on profitability with and without considering environmental factors. The schematic representation of the theoretical framework has been presented as follows in Figure 1: Figure 1 Schematic Diagram of the Research Framework
Independent Variables Independent Variables

Cost leadership strategy Differentiation strategy Focus strategy Profitability

External environment Internal environment

Cost leadership strategy (CLS) includes the variables which help in cost minimisation. A differentiation strategy (DS) includes those variables which makes the product 4

different from others. And focus strategies (FS) includes the variables which cover the specific cost, uniqueness and geographic markets. External environment (EE) includes political stability, economic growth, socio-culture technological development, legal norms, Beema Samiti's rigid policy, number of female employees at insurance companies. Similarly, internal environment (IE) includes adequate capital skilled human resources, sufficient essential tools and equipments, good communication system, a good relationship with customers, and good management system. Return on assets (ROA) is calculated dividing average net profit by average total assets. Similarly, return on equity (ROE) is calculated dividing average net profit by average shareholders fund. Average net profits are calculated from profit and loss accounts of the past five years (i.e., from 2005 to 2009). Average total assets are calculated from the Balance Sheets of past five years (i.e., from 2005 to 2009). Average shareholders funds are calculated from the Balance Sheet of past five years (i.e., from 2005 to 2009). It includes Paidup capital, Bonus share, Profit and loss account, Reserve and surplus, Life insurance fund, Catastrophe reserve minus Miscellaneous expenses not written off). Following three hypotheses have been developed for this study: Hypothesis 1: The cost leadership strategy has positive significant impact on profitability of non-life insurance companies with and without considering environmental factors separately. Hypothesis 2: The differentiation strategy has positive significant impact on profitability of non-life insurance companies with and without considering environmental factors separately. Hypothesis 3: The focus strategy has positive significant impact on profitability of non-life insurance companies with and without considering environmental factors separately. 3. Research Methodology Research design of this study is descriptive as well as analytical in nature. This study has been based on primary data as well as secondary data. Primary data was obtained from questionnaire administered on insurance company officials including the executives, senior officers, junior officers, and others like Chartered Accountants, Lawyers, Instructors, senior agents and company advisors. Similarly, secondary data have been obtained from annual reports, financial statistics of Beema Samiti and informal interviews. A total 25 insurance companies have been registered in Beema Samiti, Nepal Government's Regulatory Authority. Among them, only 13 private-sector non-life insurance companies more than five years old have been selected as a sample. Out of the 130 questionnaires distributed to sample companies, 101 were received in a useable format (i.e., 77 percent of distribution). The study has been used Cronbach's alpha ( ) to measure reliability (George & Mallery, 2009) of the scale items. Descriptive statistics provides different aspects of measurement (i.e., mean, standard deviations, standard error, etc.) for both types of data - secondary and primary. In this study, correlation analysis was conducted to assess the relation and the direction between the variables and linear regression is used to analyse the impact of 5

independent variables (i.e., cost leadership, differentiation, and focus) on the dependent variable (i.e., ROA or ROE) of the non-life insurance companies in Nepal with and without considering environmental factors separately. However, the study has the following limitations: This study concludes Porter's (1980) generic strategies even there are different schools of strategies in the literature. Out of total 25, only 13 private non-life insurance companies of more than five years in operation are taken as a sample. So, the sample is small. The study has used only correlation and regression tests to examine the impact of generic strategies on the insurance companies' profitability. Only ROA and ROE is taken to calculate the profitability. The study also suffers from the limitation of covering only non-life type insurance sector by ignoring life type and other sub-sectors of service as well as manufacturing sectors. 4. Data Analysis and Findings According to George and Mallery (2009), reliability analysis is a popular and frequently used procedure. The Cronbach's alpha value of DS, IE of the companies, and EE of the companies are 0.877, 0.860, and 0.812 respectively that shows the reliability of these variables is good. The Cronbach's alpha value of CLS is 0.705 that shows the reliability of the variable is acceptable. The Cronbach's alpha of FS is 0.520 that shows the reliability of this variable is poor. From the correlation analysis, the correlation coefficient of DS with ROA and ROE are -0.225 and -0.272 respectively which are significant at 5 percent and 1 percent level respectively but negatively correlated separately. The correlation coefficient of CLS with DS, FS, EE, and IE are 0.675, 0.440, 0.340, and 0.437 respectively. The coefficients between CLS and DS, CLS and FS, CLS and EE, and CLS and IE are significant at 1 percent level of significance and positively correlated separately. The correlation coefficient of DS with FS, EE, and IE are 0.412, 0.307, and 0.469 respectively. The coefficient between DS and FS, DS and EE, and DS and IE are significant at 1 percent level of significance and positively correlated separately. The correlation coefficient of FS with IE and EE with IE are 0.257 and 0.654 respectively which are significant at 1 percent level of significance and positively correlated separately.
Table 1 Collinearity Statistics of Non-life Insurance Companies Without considering Environmental Factors With considering Environmental Factors Independent variables CLS DS FS Tolerance 0.512 0.527 0.782 VIF 1.95 3 1.89 6 1.27 9 Independent variables CLS DS FS EE IE Tolerance 0.491 0.493 0.778 0.564 0.486 VIF 2.037 2.030 1.285 1.772 2.056

Source: Survey 2010

The study showed that none of the correlations between all independent variables exceed 0.80 (Bryman & Cramer, 2001), which indicated that multicollinearity was not a problem in sample companies. As in Table 1, the tolerance values of all variables are above 0.10. Likewise, the VIF values are less than 10, thus further confirming that multicollinearity problem is not a concern. 4.1. Regression Analysis of Generic Strategies on Profitability (i.e., ROA and ROE) with and without Considering Environmental Factors The CLS, DS, and FS are taken as independent variables which have been regressed with dependent variables (i.e., ROA and ROE) with and without considering environmental factors separately. 4.1.1. Regression Analysis without Considering Environmental Factors in ROA From the results, F-value and p-value of Model 1 is 2.798 and 0.044 (i.e., 0.044 < 0.05) respectively which are significant at 5% level of significance. So, the model 1 is fitted. R square of this model is 0.08 (i.e., 8 percent) which means only 8 percent of variation in ROA is explained by the variation in generic strategies.
Table 2 Regression Analysis of Generic Strategies on ROA without Considering Environmental Factors Model 1 : ROA = 5.242 0.269CLS 0.685DS + 0.729FS + U p-value : (0.000) (0.573) (0.063) (0.085) Standard error: [1.380] [0.476] [0.364] [0.419] Source: Survey 2010

4.1.1.1. Test of Hypotheses without Considering Environmental Factor in ROA As shown in Table 2, the coefficient value and p-value of CLS are -0.269 and 0.573 (i.e., 0.573 > 0.1) respectively. That means, the CLS has no significant impact on ROA at 10 percent level of significance without considering environment factors. So, hypothesis 1 is not accepted. Again, the coefficient value and p-value of DS are -0.685 and 0.063 (i.e., 0.063<0.1) respectively. That means, the DS has negative significant impact on ROA at 10 percent level of significance without considering environment factors. Hence, hypothesis 2 is not accepted. Similarly, the coefficient value and p-value of FS are 0.729 and 0.085 (i.e., 0.085 < 0.1) respectively. This indicates that the FS has positive significant impact on ROA at 10 percent level of significance without considering environment factors. Therefore, the hypothesis 3 is accepted. From the hypothesis tests when the environmental factors on ROA were not considered, focus strategy had a positive impact on the profitability (ROA) of non-life insurance companies, while differentiation strategy had a negative impact, and cost leadership strategy had no significance in this respect. 4.1.2. Regression Analysis with Considering Environmental Factors in ROA As the results, F-value and p-value of Model 2 are 1.788 and 0.123 respectively which are not significant at 10% level of significance. R square of this model is 0.086 (i.e., 8.6 percent) which means only 8.6 percent of variation in ROA is explained by the variation in generic strategies with considering environmental factors. 7

Table 3 Regression Analysis of Generic Strategies on ROA with Considering Environmental Factors Model 2 : ROA = 4.842 0.333CLS 0.697DS + 0.743FS + 0.272EE 0.103IE + U p-value : (0.004) (0.498) (0.069) (0.082) (0.446) (0.815) Standard error: [1.657] [0.489] [0.380] [0.423] [0.356] [0.440] Source: Survey 2010

4.1.2.1. Test of Hypotheses with Considering Environmental Factors in ROA As shown in Table 3, the coefficient value and p-value of CLS are -0.333 and 0.498 (i.e., 0.498 > 0.1) respectively. This indicates that the CLS has no significant impact on ROA at 10 percent level of significance with considering environment factors. So, hypothesis 1 is not accepted. Again, the coefficient value and p-value of DS are -0.697 and 0.069 (i.e., 0.069 < 0.1) respectively. This means that the DS has negative significant impact on ROA at 10 percent level of significance with considering environment factors. Hence, the hypothesis 2 is not accepted. Similarly, the coefficient value and p-value of FS are 0.743 and 0.082 (i.e., 0.082 < 0.1) respectively. This means that the FS has positive significant impact on ROA at 10 percent level of significance with considering environment factors. Therefore, hypothesis 3 is accepted. From the hypothesis tests, it is clear that focus strategy has a positive impact on the profitability (ROA) of non-life insurance companies with considering environmental factors, while differentiation strategy has a negative impact, and cost leadership strategy has no significance in this respect. 4.1.3. Regression Analysis without Considering Environmental Factors in ROE As the results, F-value and p-value of Model 3 is 4.047 and 0.009 (i.e., 0.009 < 0.01) respectively which are significant at 1% level of significance. So, the model is fitted. R square of this model is 0.111 (i.e., 11.1 percent) which means only 11.1 percent of variation in ROE is explained by the variation in generic strategies.
Table 4 Regression Analysis of Generic Strategies on ROE without Considering Environmental Factors Model 3 : ROE = 14.958 + 0.377CLS 4.237DS + 3.266FS + U p-value : (0.009) (0.847) (0.006) (0.060) Standard error: [5.653] [1.948] [1.492] [1.717] Source: Survey 2010

4.1.3.1. Test of Hypotheses without Considering Environmental Factors in ROE As shown in Table 4, the coefficient value and p-value of CLS are 0.377 and 0.847 (i.e., 0.847 > 0.1) respectively. This means that the CLS has no significant impact on ROE at 10 percent level of significance without considering environment factors. So, hypothesis 1 is not accepted. Again, the coefficient value and p-value of DS are (-4.237) and 0.006 (i.e., 0.006 < 0.01) respectively. This means that the DS has negative significant impact on ROE at 1 percent level of significance without considering environment factors. Hence, the hypothesis 2 is not accepted.

Similarly, the coefficient value and p-value of FS are 3.266 and 0.060 (i.e., 0.060 < 0.1) respectively. This means that the FS has positive significant impact on ROE at 10 percent level of significance without considering environment factors. Therefore, the hypothesis 3 is accepted. From the hypothesis tests, it is clear that while without considering environmental factors in ROE, focus strategy has a positive impact on the profitability (ROE) of nonlife insurance companies, but differentiation strategy has a negative impact, and cost leadership strategy has no significance in this respect. 4.1.4. Regression Analysis with Considering Environmental Factors in ROE From the results, F-value and p-value of Model 4 are 2.942 and 0.016 respectively which are significant at 5% level of significance. So, the model is fitted. R square of this model is 0.134 (i.e., 13.4 percent) which means only 13.4 percent of variation in ROE is explained by variation generic strategies.
Table 5 Regression Analysis of Generic Strategies on ROE with Considering Environmental Factors Model 4 : ROE = 9.161 0.218CLS 4.815DS + 3.203FS + 0.464EE + 1.884IE + U p-value : (0.176) (0.913) (0.002) (0.065) (0.749) (0.294) Standard error: [6.723] [1.985] [1.540] [1.717] [1.444] [1.784] Source: Survey 2010

4.1.4.1. Test of Hypotheses with Considering Environmental Factors in ROE As shown in Table 5, the coefficient value and p-value of CLS are -0.218 and 0.913 (i.e., 0.913 > 0.1). This means that the CLS has no significant impact on ROE at 10 percent level of significance with considering environment factors. So, hypothesis 1 is not accepted. Again, the coefficient value and p-value of DS are -4.815 and 0.002 (i.e., 0.002 < 0.01) respectively. This means that DS has negative significant impact on ROE at 1 percent level of significance with considering environment factors. Hence, the hypothesis 2 is not accepted. Similarly, the coefficient value and p-value of FS are 3.203 and 0.065 (i.e., 0.065 < 0.1) respectively. This means that the FS has positive significant impact on ROE at 10 percent level of significance with considering environment factors. Therefore, the hypothesis 3 is accepted. From the hypothesis tests, it is clear that when environmental factors were considered, focus strategy had a positive impact on the profitability (ROE) of non-life insurance companies, while differentiation strategy had a negative impact, and cost leadership strategy had no significance in this respect. 5. Conclusions The present study examined the prevailing practices of competitive business strategies adopted in non-life insurance companies in Nepal. The competitive generic strategies are the competitive weapons or attributes that firms choose to employ in the marketplace in their mission to secure competitive advantages. This study has found that focus strategy of non-life insurance companies is positively significant with profitability; the result is in consonance with Thapa (2010) and Koo et al. (2004).

The present study also found that impact of cost leadership, differentiation and focus strategies on profitability is mixed, meaning that there are both positive and negative coefficients discovered by the present study. This result does not fully confirm the findings of Porter (1980), and Pecotich et al. (2003). The present study has also showed that the effect of differentiation strategy on profitability of the surveyed insurance companies is negatively significant. From the results of the present study, it is clear that Nepalese insurance industry has not been completely following competitive generic strategies. According to Porter (1980, 1985), generic strategies (i.e., cost leadership strategy, differentiation strategy, and focus strategy) should positively impact on performance or profitability of the company. In this study, only focus strategy has positive impact on profitability but in case of cost leadership strategy, it has found no impact on profitability, and in case of differentiation strategy, it has a negative impact. The lack of knowledge or awareness of insurance business can be the cause of reporting such negative and insignificant impacts in non-life insurance industry of Nepal. Similarly, the study has shown that environmental factors make no impact on generic strategies of non-life insurance companies of Nepal. 6. Further Research The present study has covered only service sector of non-life type insurance companies ignoring life type, manufacturing, and other industrial sectors. Therefore, future studies should also cover these areas as far as the issue of their generic strategies is concerned.

BIBLIOGRAPHY
Allen, R.S., & Helms, M.M. (2006). Linking Strategic Practices and Organizational Performance to Porter's Generic Strategies. Business Process Management Journal, 12(4), 433-454. Arias, D.M.C. (2009). Analysis of Michael Porters generic strategies and its usage in a globalisation business environment (Unpublished doctoral dissertation). Ecole International De Montepellier, France. Bhattarai, D.R. (2010). Generic strategies and sustainability of financial performance of commercial banks in Nepal (Unpublished M. Phil. dissertation). Faculty of management, Tribhuvan University, Kathmandu. Bryman, A., & Cramer, D. (2001). Quantitative Data Analysis with SPSS Release 10 for Windows: A Guide for Social Scientists. East Essex: Routledge. Buzzell, B.T., & Gale, B.T. (1987). Principles: Linking Strategy to Performance. New York, NY: The Free Press. Candy, R.D. (2009). Resources, strategy and performance (Masters thesis). University of Canterbury Dess, G.G., & Davis, P.S. (1984). Porter's generic strategies as determinants of strategic group membership and organizational performance. Academy of Management review, 27, 467-488. George, D., & Mallery, P. (2009). SPSS for windows, step by step (8th ed.). Delhi, Patparganj: Dorling Kindersley (India) Pvt. Ltd., licensees of Pearson Education in South Asia. 10

Hall, R. (1993). A framework linking intangible resources and capabilities to sustainable competitive advantage. Strategic Management Journal, 14(8), 607618. Hambrick, D.C., McMillan I.C., & Day D.I. (1982). Strategic attributes and performance in the four cells of the BCG matrix-A PIMS-based analysis of industrial product business. Academy of Management Journal, 25, 510-531. Hawes, I.M., & Crittendon, W.F. (1984). A taxonomy of competitive retailing strategies. Strategic Management Journal, 5(2), 275-287. Hill, C.W.L. (1988). Differentiation versus low cost or differentiation and low cost: a contingency framework. Academy of Management Review, 13(3), 401-412. Kaspal, A. (2009). Competitive business level strategies in Nepalese joint venture banks and private domestic banks (Unpublished M. Phil. dissertation). Faculty of management, Tribhuvan University, Kathmandu. Kaymak, T. (1998). Business level strategies and performance in a global industry (Unpublished doctoral dissertation). Faculty Texas Tech University. Koo, C.M., Koh, C.E., & Nam, K. (2004). An examination of Porter's competitive strategies in electronic virtual markets: A comparison of two On-line business models. International Journal of Electronic Commerce/Fall, 9(1), 163-180. Kotha, S., & Vadlamani, B.L. (1995). Assessing generic strategies: An empirical investigation of two competing typologies in discrete manufacturing industries. Strategic Management Journal, 16, 75-83. Kupka, S., & Jamart, T. (2009). Does the customer really matter? The achievement of sustainable competitive advantage through relationship marketing (Unpublished doctoral dissertation). School of Business and Engineering, Halmstad University. Mathur, S.S. (1988). How rms compete: a new classication of generic strategies, Journal of General Management, 14(1) 30-60. Miles, R.E., & Snow, C.C. (1978). Organizational Strategy. Structure, and Process. New York, NY: McGraw-Hill. Miller, D. (1988). Relating Porters business strategies to environment and structure: Analysis and performance implications. Academy of Management Journal, 31, 280-308. Murray, A.I. (1988). A contingency view of Porter's generic strategies. Academy of Management Review, 13(3), 390-400. Parnell, J.A. (1997). New evidence in the generic strategy and business performance debate: A research note. British Journal of Management, 8, 175-181. Pecotich, A., Purdie, F.J., & Hattie, J. (2003). An evaluation of typologies of marketplace strategic actions. The structure of Australian top management perceptions. European Journal of Marketing, 37(3/4), 498-529. Phillips, L.W., Chang, D.R., & Buzzell, R.D. (1983). Product quality, cost position, and business performance: A test of some key hypotheses. Journal of Marketing, 47(2), 26-43. Porter, M. (1980). Competitive strategy: Techniques for analyzing industries and competitors. New York: Free Press. Porter, M. (1985). Competitive Advantage Creating and Sustaining Superior Performance. New York, NY: Free Press. Porter, M. (1996). What is strategy? Harvard Business Review, 61-78.

11

Power, T.L., & Hahn, W. (2004). Critical competitive methods, generic strategies, and firm's performance. The International Journal of Bank Marketing, 22(1), 4364. Proff, H. (2000). Hybrid strategies as a strategic challenge-the case of the German automotive industry. Omega. 28(5), 541. Segev, E. (1989). A systematic comparative analysis and synthesis of two businesslevel strategic typologies. Strategic Management Journal, 10(6), 487-505. Slater, S.F., & Olson, E.M. (2000). Strategy type and performance: The influence of sales force management. Strategic Management Journal, 21, 813-829. Thapa, M. (2008). Generic strategies and performance benchmarking of commercial banks of Nepal (Unpublished M. Phil. dissertation). Faculty of management, Tribhuvan University, Kathmandu. Thapa, M. (2010). Competitive strategy and performance of the Nepalese Banking Industry. PYC Nepal Journal of Management, 3(1), 8-18

12