engleski

Achieving superior performance: the importance of industry structure

This paper aims to explore relationship between industry and firms’ performance. Industry structure is described through five competitive forces that, as theory states, define industry’s profitability. However, although choosing profitable industry is important, it should not be crucial for firm’s success. In this paper, external theories of firm’s performance will be analysed and the importance of industry for firm’s performance will be examined. The questionnaire is sent to CEO's of Croatian large firms that are identified based on the data from Croatian Chamber of Economy. A total of 87 usable completed surveys are collected, which resulted in the response rate of 19%. There are questions describing competitive rivalry, power of substitutes, threat of the new entry, power of suppliers and power of buyers. Performance is analysed through five elements: sales, sales growth, profitability, market share, market share growth and sustainability of achieved performance. Hypotheses are tested using SPSS 17.0. The results have shown that relationship between industry and performance exits, but that industry is not major factor that is responsible for firm’s success.

competitive forces, five forces model, industry structure, performance

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