Analysis of competitiveness in Colombian family businesses

Abstract

Purpose Building on the resource-based view and the configuration theory, the purpose of this study uses a systemic and multidimensional competitiveness index (CI) i.e. that incorporates system constraints among the 10 competitive pillars that form the index to assess the competitiveness level and the connection between competitiveness and economic performance [return on assets (ROA)] in family businesses (FBs). Design/methodology/approach For the empirical application, the use a unique primary data set drawn from the global competitiveness project (www.gcp.org) that includes information for 77 Colombian FBs for 2017. Cluster analysis is used to evaluate the potential relationship between competitiveness, the configuration of competitive pillars and economic performance (ROA). Findings The results for the CI show that the main competitive strengths of the analysed firms are related to the introduction of product innovations and networks (suppliers and customers), while the limited use of technologies in their operations and the low online presence are the main competitive weaknesses of these firms. Additionally, the findings of the cluster analysis reveal that different configurations of competitiveness pillars are associated with different performance levels. Therefore, the results contribute to identifying how specific strategies aimed at improving different resources or capabilities contribute to enhance business competitiveness, and ultimately, performance. Originality/value By using an index number that takes into account the multiple interactions between resources and capabilities, the proposed analysis not only sheds light on the drivers of competitiveness i.e. resources and capabilities, and its connection to performance but also contributes to understanding the boundaries of the businesses’ competitiveness system, as well as the strategies that can potentially enhance competitiveness, and subsequently, business performance.

Actividad emprendedora de los millennials en Antioquia (Colombia)

“…The competitiveness index, based on the theory of resources and capabilities, is a valuable method for measuring business competitiveness, since it is made on the basis of a multidimensional construction that also takes into account interactions by bottleneck (Lafuente et al, 2016;Moreno-Gómez & Lafuente, 2019).…”

“…To measure the competitiveness of the companies, the index of competitiveness of companies was used, starting from the resource-based vision (VBR) and the configuration theory; the procedure described by Lafuente, et al (2016) was used; they developed a multidimensional and systemic index, which involves 10 competitive pillars, which must be normalized and later compensated, through a penalty function of the low-performance pillars (Lafuente et al, 2016;Moreno-Gómez & Lafuente, 2019).…”

“…(Bhawsar & Chattopadhyay, 2015) Competitiveness is a set of ten mutually dependent pillars: human capital, product, internal market, networks, technology, decision making, strategy, marketing, internationalization, and online presence, which enable a company to compete effectively with other companies and serve customers with valuable goods and services. (Moreno-Gómez & Lafuente, 2019) Source: Own elaboration Latruffe considers about competitiveness::…”

“…There is an interest in focusing on the company and its resources to analyze competitiveness (Ismail, Rose, Uli, & Abdullah, 2012;Krugman, 1994), since companies are the ones that compete and make the country that hosts them competitive (M. Porter, 1990;Saavedra, 2014); in this sense, the analysis of business competitiveness approached from the resource-based vision (RBV) has begun to gain ground as one of the dominant theoretical frameworks for analyzing business competitiveness, which can be seen from a systemic and multidimensional perspective to assess the level of competitiveness (Moreno-Gómez & Lafuente, 2019).…”

“…Taking into account the above, we proceeded to calculate the competitiveness index (see table 6), based on the 10 components that make it up (Lafuente et al, 2016), making the average for each of the categories, where the maximum possible scale for the competitiveness index (CI) is equivalent to a value of ten (Moreno-Gómez & Lafuente, 2019). Source: Own elaboration…”