Generic strategy research: Application of lisrel and smallest space analysis

The concept of generic strategies remains the principal framework in discussions of business-level strategy formulation in research and teaching. Given that generic strategy typologies (e.g., Porter, 1980; Mintzberg, 1988) represent latent constructs, researchers have predominantly employed Factor Analysis to identify underlying dimensions among observed variables (i.e., generic competitive methods). However for the generic strategy research stream to progress, statistical techniques that examine the relative "goodness-of-fit" of different typologies to empirical field data are sorely needed. The purpose of this paper is to discuss the appropriateness and application of LISREL and Smallest Space Analysis (SSA) for generic strategy research. Specifically, we argue that the use of these techniques allow researchers to clarify and crystallize some of the assertions underlying the concept of generic strategies and to test them more rigorously than in the past.