The Role of Business Strategy in Mediating the Relationship Between Industrial Competition and Performances: A Study in the Higher Education Industry in Timor-Leste

Abstract

This research aims to examine the role of business strategy (i.e. differentiation strategy, cost leadership, service focus, and innovation strategy) in mediating the relationship between industrial competition and performancein the higher education sectorin Timor-Leste. The literature was reviewed in regard to both theoretical and empirical approaches. 157 leaders, including heads of departments of eleven accredited higher education institutions in Timor-Leste were sampled, yielding130 validquestionnaires. Smart-PLS was used to testthe hypothesis. This study found that integrated business strategy based on the industrial cost leadership strategy, and the resource-based strategy (innovation strategy) positively and significantly influence industrial performance. The study contributes empirically to the debate on the industrial environment suitability strategy and combined strategy based on the contingency approach from the higher education industry’s perspective. The practical implications are to enlighten government and higher education leadersin emerging countries to adopt strategic suitability principles to enhanceperformancein the higher education sector. Keywords: industrial competition, business strategy, higher education institution, industrial performance.