Moses Acquaah

Corporate Management, Industry Competition and the Sustainability of Firm Abnormal Profitability

This paper models the sustainability of firmabnormal profitability and uses theeffectiveness of corporate managementcapabilities as a test to examine its impact onthe sustainability of firm abnormalprofitability. The role of industry competitionas a moderator between the effectiveness ofcorporate management capabilities and thesustainability of firm abnormal profitabilityis also examined. Consistent with theresource-based view of the firm, we found thatthe effectiveness of corporate managementcapabilities positively influence thesustainability of firm abnormal profitability.This implies that corporate managementcapabilities are important contributors to theentire bundle of firm-specific resources andcapabilities which enable some firms togenerate competitive advantages that aresustainable. The effectiveness of corporatemanagement capabilities has a larger influenceon the sustainability of firm abnormalprofitability for firms in lowly competitive ormonopolistic industries than firms in highlycompetitive industries. The findings supportthe notion that not only do firm capabilitiesyield sustainable competitive advantages andabnormal profitability, but also industrycompetition reinforces the impact of firmcapabilities in yielding sustainable abnormalprofitability.

Competitive Strategy, Environmental Characteristics and Performance in African Emerging Economies: Lessons from Firms in Ghana

ABSTRACT This paper examines the impact of the implementation of competitive strategy on organizational performance in response to economic liberalization policies using survey data from organizations in Ghana. We also examine how the perceived intensity of industry competition and industry sector moderate the relationship between competitive strategy and organizational performance. The results show that the implementation of the competitive strategies of low-cost, differentiation, and integrated low-cost and differentiation were all positively related to performance (return on assets and return on sales). We also find that both industry competition and industry sector moderate the relationship between differentiation strategy and return on assets. Moreover, industry competition moderates the relationships between both low-cost and differentiation strategies and return on sales. The results indicate that implementing a clearly defined competitive strategy is beneficial to organizations experiencing significant changes in the environment due to economic liberalization. The findings also suggest that while low-cost strategy is more beneficial to organizations in a highly competitive industry, differentiation strategy is more beneficial to firms in lowly competitive industry. At the same time, organizations in the manufacturing sector benefit more than those in the service sector when they implement the differentiation strategy. Managerial implications are presented.

Resilience in family and nonfamily firms: an examination of the relationships between manufacturing strategy, competitive strategy and firm performance

Economic recessions that affect firms regardless of location, increased competition and changes in customer expectations, all contribute to disruptions that require firms to be resilient. Building resilience is a long-term strategic initiative that changes the way a firm operates by aligning linkages between functional strategies and competitive strategy. This article compares the relationship between manufacturing strategy and competitive strategy, and the relationship between manufacturing strategy and performance for family and nonfamily firms in the developing economy of Ghana. Using data from 122 manufacturing firms, the results indicate that delivery strategy is associated with the competitive strategy of cost leadership for family firms while flexibility is associated with cost leadership for nonfamily firms. Flexibility is related to the competitive strategy of differentiation for family firms but not for nonfamily firms. While delivery is associated with both sales growth and profitability for family firms, for nonfamily firms only flexibility is related to profitability. Our study suggests that family firms and nonfamily firms in Ghana use different manufacturing strategy components to build resilience. Implications of this pattern of results are discussed.

BUSINESS STRATEGY AND COMPETITIVE ADVANTAGE IN FAMILY BUSINESSES IN GHANA: THE ROLE OF SOCIAL NETWORKING RELATIONSHIPS

The business strategy perspective argues that achieving competitive advantage hinges on pursing a coherent competitive strategy. Family businesses are also said to manifest a strong desire to develop enduring and committed social relationships with external stakeholders. This study examines the effect of business strategy on performance of family businesses and how their managerial social networking relationships with external entities moderate the business strategy–performance link. Using data from 54 family firms from Ghana, the findings indicate that: (1) the pursuit of the business strategies of cost leadership and differentiation create competitive advantage for family businesses; (2) social networking relationships with government bureaucratic officials and community leaders are beneficial to family businesses, but social networking relationships with political leaders is detrimental to family businesses; and (3) the benefit of business strategy to family businesses is moderated positively by networking with community leaders, but negatively by networking with political leaders.

A longitudinal analysis of the moderated effects of networking relationships on organizational performance in a sub-Saharan African economy

The conventional wisdom from studies in both advanced Western economies and emerging economies indicate that managerial networking relationships matter. This article examines the circumstances under which managerial networking relationships matter by focusing on how the effect of managerial networking relationships on organizational performance is contingent upon certain organizational and environmental characteristics.The development and utilization of managerial networking relationships with external entities is broadened to include those with top managers of other firms, political leaders, government bureaucratic officials, and community leaders. Using data from 106 organizations in Ghana over two time periods, the findings show that only managerial social networking relationships with top managers of other firms, government bureaucratic officials, and community leaders enhance organizational performance. Moreover, the effect of networking relationships on performance is contingent on organizational as well as environmental characteristics. The findings of the moderating analyses clearly indicate that firms in Ghana should not establish networking relationships with external entities without considering the characteristics of their organizations and the environment.

Why Africa Journal of Management and Why Now

In this article, we provide the background as well as the rationale for the decision to establish the Africa Journal of Management. We begin by telling the story of the genesis of AFAM and its aspirational mission. Next, we discuss the forces and realities that make it the right time to introduce a journal dedicated to management and organizations in Africa. Thereafter, we describe our views on the challenges of doing research on management in Africa. We close with AFAMs aspirations for Africa Journal of Management.

The Relationship between Competitive Strategy and Firm Performance in Micro and Small Businesses in Ghana: The Moderating Role of Managerial and Marketing Capabilities

This study investigates the role of managerial and marketing capabilities in moderating the relationship between competitive strategy and firm performance using data from 581 micro and small businesses (MSBs) in Ghana. Using a hierarchical multiple regression analysis the findings indicate that while differentiation strategy is related to performance, cost leadership strategy does not influence performance after controlling for several firm-specific factors. The findings further show that both managerial capability and marketing capability moderate the relationship between competitive strategy (cost leadership and differentiation) and performance for MSBs in Ghana. However, managerial capability strengthens the influence of cost leadership strategy on performance, while it weakens the impact of differentiation on performance. Moreover, marketing capability augments the impact of differentiation on performance, while it diminishes the influence of cost leadership on performance. The findings indicate a contingency approach to the implementation of competitive strategy by MSBs.

Advancing Africa through management knowledge and practice: the way forward

Purpose – The purpose of this paper is to review and summarizes the articles that were accepted for the special issue focusing on “Advancing Africa through management knowledge and practice”. The paper also provides suggestions for future research focus for researchers on management issues in and about Africa.Design/methodology/approach – The paper presents a conceptual review the distinctiveness of the five articles in the special issue which focus a personal reflection about management research and education in Africa, effective leadership development in Africa and the African diaspora, performance management implementation in the public sector; internationalization process of African businesses with special reference to banks; and strategic factors that could be emphasized by African firms to improve their performance. These papers are synthesized to present a coherent management research framework for Africa.Findings – African management research requires a strategic choice approach, which asks intere...

The Impact of Managerial Networking Relationships on Organizational Performance in SubSaharan Africa: Evidence from Ghana*

This paper focuses on how managerial networking relationships developed with external entities affect organizational performance using survey data from organizations in Ghana. Networking relationships with external entities are established so as to obtain resources, valuable information, and to acquire and exploit knowledge, in order to overcome the high level of uncertainty in the business environment. The findings provide strong support that managerial networking relationships developed with top managers of other firms, government bureaucratic officials, community leaders, and leaders of employee unions and representatives enhance organizational performance. However, managerial networking relationships developed with politicians at different levels of government are either not related to performance or impede performance. Empirically, the findings confirm that managerial networking relationships may have beneficial as well as detrimental effects on organizations.

Firm-Specific Managerial Experience and the Social Capital–Performance Relationship in a Sub-Saharan African Transition Economy

The authors examine the direct and moderating effects of firm-specific managerial experience on the relationship between social capital and performance. Using data from Ghana, the findings show that social capital from bureaucratic officials and community leaders, as well as firm-specific managerial experience, have a positive influence on performance, while social capital from politicians has a negative influence on firm performance. Furthermore, firm-specific managerial experience positively moderates the relationship between (a) social capital from politicians and performance, and (b) social capital from community leaders and performance. Therefore, firm-specific managerial experience attenuates the detrimental effects of social capital from politicians on performance. The findings contribute to knowledge in the social capital and resource-based view literature.